Finding Text
Finding 2022-004: Use of Sole-Sourced Justification for Procurement Federal Programs: All Programs Criteria: Under Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) Section 200.320(f) ?Methods of procurement to be followed?, procurements by noncompetitive proposals (i.e. sole-sourced justification) may be used only when one or more of the following circumstances apply: ? The item is available only from a single source; ? The public exigency or emergency for the requirement will not permit a delay resulting from competitive solicitation; ? The Federal awarding agency or pass-through entity expressly authorizes noncompetitive proposals in response to a written request from the non-Federal entity; or ? After solicitation of a number of sources, competition is determined inadequate. Condition: Our audit work over various expenses disclosed instances of consultants and vendors hired under the sole-sourced justification method of procurement. Although the expenses were properly supported, the rationale for several sole-sourced selections was not properly documented and/or not always appeared to be reasonable. Cause: The Consolidated Entity was not in full compliance with sole-sourced justification requirements, as stated above, during the year ended September 30, 2022. Effect or Potential Effect: The Consolidated Entity could enter into contractual arrangements whereby they are not receiving the best value for the organization and/or in which there exists conflicts of interest. Ultimately, transparency with respect to these transactions could be compromised if the proper procurement actions are not followed. Questioned Costs: None noted. Context: The Consolidated Entity failed to consistently document its justification with respect to solesourced according to the above-noted requirements. Identification as a Repeat Finding: 2021-003 Recommendation: We recommend that the Consolidated Entity limit its use of sole-sourced justification based on the above-noted requirements. In cases where sole-sourced is appropriate, we recommend that the actions (or lack of actions) be properly and fully documented. Subsequent to the year under audit, we noted management is working on updating it?s policies and practices related to sole-source justification and has consulted with us on several matters to ensure not only compliance, but efficiencies are maintained.