Judicial Branch Procurement

CALIFORNIA STATE AUDITOR | Report 2023-302 1 January 2024 Audit Objectives and the Methods Used to Address Them AUDIT OBJECTIVE METHOD 1 Determine whether the judicial • Reviewed changes to the Public Contract Code, SAM, and SCM that occurred from July 2021 contracting manual is consistent with through June 2023 and identified significant changes that affect the Judicial Council. the requirements set forth in the judicial • Compared the significant changes we identified in the Public Contract Code, SAM, and SCM to contract law. the contracting manual and determined whether the contracting manual is consistent with requirements set forth in the judicial contract law. 2 Determine whether the Judicial • Reviewed revisions to the Judicial Council’s local manual that occurred from July 2021 Council’s local manual conforms to through June 2023 to determine whether these revisions conflict with requirements in the the contracting manual. contracting manual. • Reviewed these same revisions to the local manual to verify whether applicable updates to the contracting manual that occurred from July 2021 through June 2023 were incorporated into the local manual. 3 Assess the Judicial Council’s internal • Reviewed the contracting manual, the Judicial Council’s local manual, and the Judicial controls over procurement practices Council’s procedures and interviewed staff to assess the Judicial Council’s internal controls for and determine whether it complied contracting and procurement. with those controls and other key • Using data from FI$Cal, identified procurements from July 2021 through June 2023, requirements—including requirements selected 40 of those procurements—15 contracts, 20 purchase orders, and five contract related to competitive bidding and amendments—and tested them for compliance with requirements of the judicial contracting sole‑source contracting—when manual and the Judicial Council’s local manual. These requirements included those relating to completing its procurements. procurement approval, segregation of duties, competitive bidding, and other key controls. 4 Assess the Judicial Council’s internal • Reviewed the contracting manual, the Judicial Council’s local manual, and the Judicial Council’s controls over payment practices and procedures and interviewed staff to assess the Judicial Council’s internal controls for payments. determine whether the entity complied • Selected one invoice payment from each of the 40 procurements we selected to address with those controls. Objective 3, and tested for compliance with the requirements about invoice approval, proper authorizations, and segregation of duties. 5 Evaluate the Judicial Council’s contracts • Identified a provision in the contracting manual that prohibits Judicial Branch entities from to determine whether the Judicial splitting transactions costing more than $10,000 into multiple transactions costing less than Council inappropriately split any $10,000 to avoid competitive bidding requirements. contracts to avoid necessary approval or • Reviewed the contracting manual and the Judicial Council’s plans for training staff to identify competitive bidding requirements. the controls used—or that it plans to use—to prevent contract splitting. • Using data from FI$Cal, identified vendors from which the Judicial Council made multiple procurements of less than $10,000 from July 2021 through June 2023. • Reviewed procurement documentation to determine whether any of those multiple procurements should have been a single competitively bid procurement. 6 Assess the reliability of the Judicial • Obtained FI$Cal data from the Judicial Council for July 2021 through June 2023. Council’s contract and payment data • Selected hard copy procurement files and searched for those procurements in FI$Cal to recorded in FI$Cal to ensure the accuracy determine whether the procurements existed in the system and were accurate. and completeness of the data and to • Compared information from the payment invoices selected as part of Objective 4 to the FI$Cal establish testing selections. data to determine whether the invoices existed in the system and were accurate. Source: Audit workpapers.