Procurement and the Auditor

1. Procurement and the Auditor Presented by: Tanesha Stokes, VCO Of the Auditor of Public Accounts

2. What is the APA? • The Auditor of Public Accounts is a constitutional officer with powers granted by Virginia’s constitution (Article IV, § 18) and as specified in the Code of Virginia (Chapter 14, §§ 30.130 – 30.142) • The Auditor of Public Accounts reports through the Joint Legislative Audit and Review Committee (JLARC) in the General Assembly • The APA is the legislative external auditor for: • All State agencies • Institutions of Higher Education • Constitutional officers, and • Various boards and authorities under the executive and judicial branches of state government

3. Who’s the Boss?! • The Auditor of Public Accounts • The Independent Auditor of the Commonwealth • Appointed to a 4 year term by the General Assembly • Has been with the APA since 1977 Walter J. Kucharski, CPA, CFE

4. Mission The APA serves Virginia citizens and decision-makers by providing unbiased, accurate information and sound recommendations to improve accountability and financial management of public funds.

5. Where do we fit in?

6. APA Specialty Teams • Acquisition and Contract Management • Budgeting and Performance Management • Capital Asset Management • Data Analysis • Financial Management • Higher Education Programs • Information Systems Development • Information Systems Security • Reporting and Standards • Social and Medical Services • Judicial Systems

7. Acquisition and Contract Management The Acquisition and Contract Management Team promotes effective and efficient use of public funds in acquisitions and contract management through the identification and recommendation of best practices.

8. Acquisition and Contract Management Team Director: Andy Powell, CPA, MBA, VCO Specialists: Chadam Hover, CISA,VCO Andrew McCarty, CISA,VCO Angela O’Mary, VCO Shawnise Newsome, VCO Blair Price, VCO Tanesha Stokes, VCO Brett Sinsabaugh

9. Auditing the Procurement Cycle

10. Responsibilities of the Agency • Provide Documentation (Evidence) • Agency Procurement and Accounts Payable Policies and Procedures • Master listing of all term contracts • Determination of Need • Justification of non-Competitive Sealed Bid procurement • RFP / IFB • Bid tabulations

11. Responsibilities of the Agency • Provide Documentation (continued) • Contract • Contract Administrator assignment and duties • Change Orders • Renewals • Vendor evaluations by end-user (at least yearly)

12. Role of Each Agency • Manage the Contract • Ensure contract compliance by Vendor and End-User • Tracking and Management of contract changes • Review, approval and payment of invoices

13. Auditor Considerations • Is there the presence or absence of incentives? • Is the procurement rational, feasible and doable? • Is the procurement necessary? • Is the Commonwealth getting value from this expenditure? • Are there indicators of fraud? • Are there any violations of laws and regulations

14. Role of the Auditor • Gain an Understanding of: • Policies and Procedures • Systems and System Security • Structure of the Procurement area • Contract expenditures • Monitoring project costs tools

15. Role of the Auditor (cont.) • Gather Evidence • Test individual contract files: • Ensure that internal controls are in place • Ensure files include adequate documentation • Test compliance with State procurement regulations • Conduct Substantive Tests • Trace Contract Payments through Accounts Payable • Trace individual vouchers to Contract

16. Questions and Answers