Finding Text
Finding 2023-003: Significant Deficiency - Internal Control Over Procurement, Suspension and
Debarment
Program Water and Waste Disposal Systems for Rural Communities
Federal Agency U.S. Department of Agriculture
Assistance Listing Number 10.760
Criteria: For federal awards after January 1, 2018, guidance provided in 2 CFR part 200.318 requires
nonfederal entities to establish and follow their own documented procurement procedures that
conform to applicable federal law and standards. 2 CFR part 200.320 includes different allowable
methods of procurement. There are also requirements to verify the vendors are not suspended or
debarred.
Condition/Context: During our testing for this program, we noted that the City did not have a written
procurement policy to conform with Uniform Guidance requirements. The City contracted with a thirdparty
administrator who provided the services related to procurement for this grant program.
Cause: The City was not aware that a written policy was required to be in place outside of the terms
and condition in the grant agreement.
Effect: Without an adequate policy in place, procurement procedures may not adhere to requirements
of federal awards.
Questioned Costs: None noted.
Recommendation: Program personnel should become familiar with the procurement, suspension and
debarment rules for Federal programs and implement a formal written policy to conform with Uniform
Guidance requirements.
Views of Responsible Officials: Management agrees with the finding and will make efforts to
implement a formal procurement policy.