Finding 59135 (2022-002)

Criteria or specific requirement: Per procurement standards, nonfederal entities other than States, must follow the procurement standards set out at 2 CFR Sections 200.318 through 200.326. Per 2 CFR Section 200.319, procurement expenditures require documentation over the bidding process. Condition: During our testing, we identified transactions which the Organization contracted with a vendor for services that exceeded the $3,000 threshold (the Organizations? requirement per their procurement policy) and did not retain documentation for the bidding process for these services. Questioned costs: N/A Context: During our testing, we identified transactions which the Organization contracted with a vendor for services that exceeded the $3,000 threshold (the Organizations? requirement per their procurement policy) and did not retain documentation for the bidding process for these services. Cause: Client did not have a consistent process for ensuring the procurement processes were followed. Effect: Noncompliance could result in the Organization not obtaining the best pricing and spending the federal funds appropriately. Recommendation: We recommend that the Organization implement processes and procedures to ensure that all disbursements charged to the federal follow the proper procurement standards and to maintain support for the procurement methods used. Management Response: The Organization is reviewing and modifying the Purchase Requisition and Purchase Order Policy to reflect current practices more accurately, update federal regulations and associated purchase thresholds. In addition, the Organization is improving internal procedures to manage requisition submittals which reach thresholds that would dictate multiple bid submittals as well as ensure an annual training of the Organization?s management and purchasers on policy parameters.