A Performance Audit
An Audit Report on Selected Contracts at the Department of Information Resources
Auditors reviewed two contracts at the Department of Information Resources (Department) and determined the following:
The Department planned, procured, and formed the data center services contract with Atos Governmental IT Outsourcing Services LLC in accordance with applicable requirements. However, the Department should improve certain aspects of contract oversight to help ensure that it complies with applicable requirements.
The Department planned and formed the procurement through which it awarded the Cooperative Contract with C&T Information Technology, Inc. for information technology staffing augmentation in accordance with applicable requirements. However, it should improve certain aspects of contract procurement, oversight, and training.
The Department Planned, Procured, and Formed the Atos Contract in Accordance with Applicable Requirements, But It Should Improve Certain Aspects of Contract Oversight
The Department of Information Resources (Department) planned, procured, and formed the data center services contract with Atos Governmental IT Outsourcing Services LLC (Atos) in accordance with applicable requirements. However, the Department should improve certain aspects of its contract oversight. The Department had not updated its contract management plan or its risk assessment for the Atos contract since the contract was assigned to Atos in May 2015.
In addition, the Department’s contract monitoring system, Salesforce, did not have adequate controls for the approval and authorization for the payment of invoices for the Atos contract.
The Department also did not adequately control access to a network location where it maintained key invoice review spreadsheets.
The Department Planned and Formed the C&T Contract in Accordance with Applicable Requirements, But It Should Improve Certain Aspects of Contract Procurement
The Department planned the procurement through which it awarded the C&T contract in accordance with the requirements in the State of Texas Contract Management Guide.
The Department adequately performed certain contract formation activities for the C&T contract.
The Department adequately performed certain procurement activities for the C&T contract, such as conducting contract negotiations. However, the Department should improve certain aspects of its procurement process.
The Department should improve controls related to its receipt of proposals. The Department properly documented its receipt of C&T’s proposal in accordance with Department procedures and as the State of Texas Procurement Manual requires. However, it scored two other vendors’ proposals without maintaining evidence that it had received them by or on the due date.
The Department should score proposals using the methodology specified in its solicitation.
Of the 17 Department employees who were involved in planning the procurement, preparing the solicitation, performing preliminary reviews of proposals, and evaluating proposals, 7 (41 percent) did not sign required nondisclosure statements and 9 (53 percent) did not sign required disclosure statements as required.
The Department Should Improve Oversight of Historically Underutilized Business Compliance for the C&T Contract
The entities that make purchases through Cooperative Contracts, such as the C&T contract, perform oversight activities related to fiscal monitoring and direct monitoring of contractor performance. However, the Department should implement procedures to monitor contractor compliance with applicable historically underutilized business (HUB) subcontracting requirements.
The C&T contract included directions for the contractor to submit the required progress assessment reports to both the Department and the entities that made purchases through the contract. However, the Department did not monitor payments to subcontractors under C&T’s HUB subcontracting plan, and it did not require submission of progress assessment reports.
The Department notified new and existing board members of contract management training required by statute. However, because it did not review whether its board members completed that training, the Department could not provide documentation to show that one board member completed that training. Additionally, although the Department required board members to receive that training “promptly,” it did not specify a due date for receiving that training.
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