Finding Text
Finding Number: 2022-006
Prior Year Finding Number: N/A
Compliance Requirement: Procurement and Suspension and Debarment
Program:
U.S. Department of Treasury
COVID-19 - Coronavirus State and Local Fiscal Recovery Funds
ALN #: 21.027
Award #: Various
Award Period: 03/03/2021- 12/31/2024
Criteria – Recipients of Federal awards must have adequate policies and controls in place to ensure that the procedures are properly documented in the entity’s files, provide full and open competition supported by a cost or price analysis, provide a vendor debarment or suspension certification, provide for retention of files, and that supporting documentation corroborate compliance with these requirements.
Condition – We sampled and selected 12 out of 20 procurement transactions during the fiscal year and noted the following:
• For 2 samples out of 12 transactions, the first invoice was issued before the contract was signed. In one of these exceptions, the purchase order was also issued before the contract was signed. Details of these two contracts are below:
o One contract was dated September 2, 2021, whereas the first invoice processed for the contract was
dated June 17, 2021, and the purchase order related to the contract was dated July 20, 2021.
o The second contract was dated December 20, 2021, whereas the first invoice processed for the contract
was dated December 8, 2021.
Questioned Costs – Not determinable.
Context – This is a condition identified per review of the School System’s compliance with the provisions of the Procurement compliance requirement using a statistically valid sample. The total amount of procurement transactions for the program during the fiscal year was $26,823,561. The amount of the 12 samples selected was $23,665,988. The known amount of the two transactions was $4,241,558.
Effect – The School System is not in compliance with the stated provisions.
Cause - The School System does not appear to have a process in place to adequately monitor and maintain completed contract files comprising of all supporting documents.
Recommendation - We recommend that the School System improves internal controls to ensure adherence to Federal relations relating to the procurements of goods and services and review current records retention policies to ensure that the required documentation is properly maintained.
Views of Responsible Officials – The School System concurs with the auditor’s findings and recommendations. The district is evaluating a centralized contract management solution that would maintain all contracts and agreements upon execution, as well as manage renewals and amendments. The planned corrective actions are presented in the School System’s Corrective Action Plan attached as Appendix B to the Single Audit Report.