Audit of Bid Specification Requirements for Soliciations, January 2018

1. Compliance with Standard Operating Procedures . Observation The SOP's for five (5) of the six (6) procurement methods under review (IFQ, IFB, RFP, RPS, and RFQ) require that if the solicitation will result in a contract, the procurement analyst will collect valid proof of insurance from the awarded vendor. The SOP for the sixth procurement method (RFIQ) does not contain such requirements; however, the department requesting the procurement is responsible for ensuring that the vendor has adequate insurance per SOP #34 – Purchase Requisition Process [See OFI No. 5, Standard Operating Procedures related to Request for Informal Quotes, page 10]. The sample of 51 solicitations tested included 45 that were processed under one of the five procurement methods that require the procurement analyst to collect valid proof of insurance from the awarded vendor (IFQ, IFB, RFP, RPS, and RFQ). Of these 45 solicitations, 39 included requirements of proof of insurance and 6 did not require proof of insurance. Of the 39 solicitations requiring insurance, two (2) instances were observed where documentation validating the awarded vendor’s required insurance was either not obtained, or was obtained after the contract was executed. Recommendation To ensure compliance with SOP's related to IFQ, IFB, RFP, RPS, and RFQ, develop and implement quality assurance processes to ensure that valid proof of insurance is obtained prior to executing a contract or entering into an agreement with the awarded bidder. Management Response Before a vendor is awarded a contract or a purchase order the successful vendor would have to been deemed responsive. To be responsive a vendor is required to fully conform to the requirements stated in the solicitation documents, including insurance and bonding requirements. To ensure vendors are correctly deemed responsive SOP’s related to IFQ, RFB, RFP, RPS, and RFQ’s are being revised to require the procurement practitioner attach the specific insurance requirements to the Notice of Recommended Award (NORA) at the time approval of the NORA is requested. Procurement leadership will ensure the insurance documents are attached to the NORA before approving. 6 | A u d i t o f B i d S p e c i f i c a t i o n R e q u i r e m e n t s J a n u a r y 2 0 1 8