An Audit Report on Contract Management at the Texas Education Agency
August 2006
Report Number 06-064
Overall Conclusion
The Texas Education Agency (Agency) should improve its contracting processes and ensure that it follows established contracting policies and procedures. The Agency does not have baseline expectations for contract monitoring, which results in a range of monitoring effectiveness across the divisions. For example, audit testing identified:
- Six contracts for which the Agency did not have documentation indicating it had received the goods and services for which it contracted. Those six contracts totaled $32.7 million.
- Eleven contracts with monitoring documentation that ranged from minimal notes to detailed evaluations.
The Agency does not always construct clear payment terms in its contracts or follow established contracting policies and procedures. Testing identified instances in which payments terms in contracts were not specific. Although we did not identify any inappropriate expenditure of funds, strengthening contracting controls will provide greater assurance that Agency contract expenditures are accurate.
The Agency also should strengthen automated controls to protect information it uses to support contracting decisions. The Agency should review user accounts in its Integrated Statewide Administrative System (ISAS) more frequently for inactivity and reasonableness with job duties. It also should ensure that contract amounts in ISAS agree with actual contract terms.
The Agency has not established a database that documents specific information about vendor contracts entered into by all independent school districts. We surveyed 18 school districts to inquire about their contracting activity and contract expenditures. Information some districts provided indicated that their most significant contracts are for construction of school buildings, utilities, professional services, food service, transportation, copiers and printers. The majority of school districts' expenditures are for salaries and benefits.
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