Finding Text
Small Business Administration Financial Assistance Listing #59.008
COVID‐19 Disaster Assistance Loans
Procurement
Material Noncompliance and Material Weakness in Internal Control over Compliance
Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance)
and 2 CFR sections 200.318 through 200.326 set forth the procurement standards non‐federal
entities other than states must follow when operating federal programs and the procurement
procedures required depending on the amount of the transaction. The Organization is required
to create a written procurement, suspension, and debarment policy that complies with
applicable federal requirements and to follow this policy when procuring goods and services.
The Organization is also required to retain documentation supporting performance of a price
analysis, open competition, and review for suspension and debarment.
Condition: The Organization does not have a written procurement policy. Additionally, there was
no documentation to support a price analysis over the transactions tested or documentation
supporting that vendors were reviewed for suspension and debarment. There was also no
documentation for review of the procurement transactions tested.
Cause: The Organization had turnover and limited staffing available.
Effect: The Organization did not ensure that the procurement policy was complete and accurate.
Questioned Costs: None reported.
Context/Sampling: A nonstatistical sample of 4 transactions out of 9 procurement transactions
were selected for testing, which accounted for $156,353 of $297,188 of federal program
expenditures.
Repeat Finding from Prior Year(s): No
Recommendation: We recommend the Organization’s management implement a written
procurement policy to follow and documenting the performance of required procurement
procedures.
Views of Responsible Officials: Management agrees with the finding.