A Performance Audit
An Audit Report on Contracting Processes in the Parks and Wildlife Department’s Infrastructure Division
The Parks and Wildlife Department’s (Department) Infrastructure Division (Division) had processes and related controls for capital construction projects and associated design and construction contracts to help ensure that:
- It performed required planning to identify project needs and develop a plan to meet those needs.
- For design contracts, it appropriately solicited proposals in accordance with requirements, received and documented vendor responses, notified contracting staff of the recommendation to award, and reviewed and approved the contracts.
- For construction contracts, it issued appropriate solicitations; obtained, reviewed, and approved vendor responses; evaluated and scored responses using consistent evaluation criteria; and appropriately documented its contractor selection.
- It administered and monitored design and construction contracts.
- It closed out design and construction contracts in accordance with its processes.
In addition, the Department analyzed and reorganized its capital construction project delivery processes to help ensure that it encumbered and spent funds in a timely manner.
However, the Department should ensure that the Division consistently (1) maintains its vendor evaluations, (2) requires staff to complete nondisclosure agreements and conflict of interest forms, (3) documents its contractor selection, and (4) includes all essential clauses in contracts. The Department also should strengthen access controls to help ensure the integrity of critical information in its financial accounting system.
For the 23 capital construction projects tested, the Parks and Wildlife Department’s (Department) Infrastructure Division (Division) performed required planning necessary to identify each project’s needs and develop a plan to meet those needs.
The Division Procured and Formed the Contracts Tested in Accordance with Most of Its Processes, But It Should Consistently Document Its Evaluations, Require Staff to Complete Nondisclosure Agreements and Conflicts of Interest Forms, and Include All Essential Clauses in Contracts
The Division had processes and related controls to help ensure that it procured 24 design contracts and 12 construction contracts associated with 23 capital construction projects tested in accordance with applicable requirements. However, the Division should ensure that it consistently (1) maintains its vendor evaluations, (2) requires staff to complete nondisclosure agreements and conflict of interest forms, (3) documents its contractor selection, and (4) includes all essential clauses in contracts.
The Division Administered and Monitored the Design and Construction Contracts Tested in Accordance with Its Processes
The Division had processes and related controls to help ensure that it administered and monitored the design and construction contracts tested in accordance with applicable requirements.
The Division Closed Out the Design and Construction Contracts Tested in Accordance with Its Closeout Processes
The Division had policies and procedures that addressed the key areas from the State of Texas Contract Management Guide related to contract closeout and liquidated damages. Seven of the 23 projects tested were closed, and the Division obtained the required closeout review and approvals for 6 of those projects.
In addition, auditors tested the 11 construction and design contracts associated with the 7 closed projects to determine whether the Division maintained documentation showing that it followed its contract closeout process. Auditors determined that:
- The Division maintained applicable documentation (such as the final invoice, contract closeout routing slip, and certificate of final completion) for all four of the six design contracts tested for which that requirement was applicable.
- For 4 (80 percent) of the 5 construction contracts tested, the Division maintained all documentation (final invoice, performance summary report, contract closeout routing slip, and certificate of final completion) necessary to support the final payment voucher.
For the five construction contracts discussed above, the Division had documentation showing that the contracts were completed within agreed-upon time frames.
The Department Analyzed and Modified Its Processes to Help Ensure That It Encumbered and Spent Funds for Capital Construction Projects in a Timely Manner
Since 2009, the Department has managed its capital construction appropriations by either fully using funds or using its unexpended and unobligated balance authority to carry forward unexpended appropriations to subsequent fiscal years. In addition, since appropriation year 2014, the Department has reorganized and made significant adjustments to its capital construction project delivery processes to address an increase in General Revenue funds it received for capital construction and a decrease in funds it received from bonds.
Most of the Department’s Information Technology General Controls Aligned with the Department’s Security Policies, But the Department Should Address Certain Access Control Weaknesses
The Department established, reviewed, and approved policies that helped to ensure that its password controls, change management, incident management, backup and recovery, and disaster recovery planning provided adequate guidance for the overall direction and implementation of its information technology security. However, auditors identified certain weaknesses in access controls for the Business Information System (BIS), which the Department used as its financial accounting system.
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