THE FEDERATION OF STATE MEDICAL BOARDS OF THE UNITED STATES, INCNon-Profit

Type of Finding: ? Noncompliance with Procurement requirements Condition: For two vendors procured via noncompetitive proposal, the justification for using that procurement method was not documented in writing at the time of procurement. Based on rationales provided via email during fieldwork, the justification was the public exigency or emergency for the requirement will not permit a delay resulting from competitive solicitation. Criterial or specific requirement: Per 2 CFR section 200.320(b), procurements that exceed the micro-purchase threshold, price or rate quotations must be obtained from an adequate number of qualified sources. Per 2 CFR 200.320(f) noncompetitive proposals may be used when one or more of four circumstances are met. Context: Of a population of seven vendors exceeding small purchase thresholds, five of the vendors were selected to test procurement. Three of the sampled vendors were procured via noncompetitive proposals, and 2 of those did not document the justification for the procurement method utilized. Effect: Vender selection may not have complied with Uniform Guidelines requirements by relying primarily on vendors with whom the Federation had previous experience. Cause: In both cases, the decisions on vender selection were made verbally on Zoom or a phone call and minutes or a memo summary were not taken. Repeat Finding: Not a repeat finding. Recommendation: CLA recommends that all rationales and justifications on procurement methods, whether noncompetitive proposal or small purchase, be thoroughly documented timely and retained for the appropriate timeframe. Views of responsible officials and planned corrective action: FSMB has implemented a procurement policy which requires that all procurement decisions must be documented, including rationale and justification for any action. Documentation may be in the form of an email or meeting notes/minutes. This documentation will be provided to the Accounting Department and a debarment search will then be performed.

Type of Finding: ? Significant Deficiency in Internal Control over Compliance Condition: For two vendors, one procured in a previous year and one procured via small purchase, a debarment check was not completed during the award/budget period. Criterial or specific requirement: Per 2 CFR part 180, a non-federal entity is prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Context: The entire population of 5 was selected to test suspension and debarment. 1 vendor from the Compact grant, the award period of which began in FY13, did not have a check done. 1 vendor from the COVID grant also did not have a check done. Effect: Federal funds could have been paid to a vendor barred from receiving federal funds. Cause: For the Compact grant vendor, the client was unaware of the annual check requirement. For the COVID grant, not performing the check was an oversight. Repeat Finding: Not a repeat finding. Recommendation: CLA recommends that a suspension and debarment check be performed on all vendors to compensated using federal awards. Views of responsible officials and planned corrective action: FSMB has modified the policy covering debarment searches to include vendors that have been utilized by FSMB for non-federal awards in the past. FSMB will conduct a debarment search on all vendors and their key employees that will be working on federal grant projects prior to vendor initiating work.

Condition: Time and effort records were adequately maintained, however were not reviewed and approved by appropriate personnel. Criterial or specific requirement: Per 2CFR section 430(i), charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Context: Of a population greater than 250, 60 dates were selected to test the employee's grant hours and wages charged to the grant. Time and effort was sufficiently documented, however was not reviewed and approved. Effect: Hours could have been charged to the grant that were not actually spent working on the grant program. Cause: Management overlooked approving the time and effort records when approving the expenditures. Repeat Finding: Not a repeat finding. Recommendation: CLA recommends that time and effort be reviewed by personnel knowledgeable of each employees? activities, including any grant-related activities. We recommend that such review be documented, and such documentation retained along with other grant supporting documentation. Views of responsible officials and planned corrective action: FSMB has upgraded the version of Clockify that is used to track employee time for grants. The new version of Clockify allows employees to enter time and Supervisors to approve the time within the system.