Report 2017-030 Recommendation 7 Responses
Report 2017-030: The State Bar of California: It Needs Additional Revisions to Its Expense Policies to Ensure That It Uses Funds Prudently (Release Date: June 2017)
Recommendation #7 To: Bar of California, State
To assign purchasing cards only to appropriate staff, ensure that the State Bar's records of employees' credit limits reflect those established with the bank, and to verify that staff use purchasing cards only for allowable and necessary expenses, the State Bar should immediately restrict the use of purchasing cards to its original purpose, which was for low-dollar and frequently occurring purchases. For purchases above $5,000, the State Bar should require the vendor to bill for payment.
Annual Follow-Up Agency Response From October 2022
Purchasing Card transactions are limited to $5,000. A copy of the Purchasing Card enrollment form and Procurement Policy Manual were previously provided to the State Auditor.
- Completion Date: May 2020
California State Auditor's Assessment of Annual Follow-Up Status: Partially Implemented
The State Bar did revise its policy to require justification of the business need for employees to receive purchasing cards and to include an annual review of the business justification for those purchasing cards. However, State Bar continues to allow some State Bar employees to maintain purchasing card limits greater than $5,000—including one employee with a limit of $50,000 (monthly) and $30,000 (single purchase). Generally, purchases of this size are not small and recurring expenses, rather they are larger purchases that the State Bar should make through the regular procurement process.
- Auditee did not substantiate its claim of full implementation
- Auditee did not address all aspects of the recommendation
Annual Follow-Up Agency Response From September 2020
Purchasing Card transactions are limited to $5,000, except for certain purchases related to facilities operations and the California Bar Examination. Only two cardholders have limits above $5,000, for these designated purposes. A copy of the Purchasing Card enrollment form and Procurement Policy Manual have been provided to the Auditor.
- Completion Date: May 2020
California State Auditor's Assessment of Annual Follow-Up Status: Will Not Implement
State Bar's revised policies provide increased controls of credit limits more than $5,000. However, State Bar policy 6.02 still allows staff to use the purchasing card for "Meeting rooms and related catering services" and not bill vendors for payment for these purchases, which is the same issue that we had during the audit. State Bar confirmed that it did not see a need to change policy regarding the use of purchasing cards for catered onsite meals.
- Auditee did not substantiate its claim of full implementation
- Auditee did not address all aspects of the recommendation
Annual Follow-Up Agency Response From October 2019
As part of our review of Procurment and Finance policies related to the January 2020 ERP upgrade, we plan to fully implement a $5,000 purchasing card limit, which will also apply to meeting room and catering costs.
- Estimated Completion Date: 1st Quarter 2020
California State Auditor's Assessment of Annual Follow-Up Status: Pending
Annual Follow-Up Agency Response From October 2018
With the separation of the Sections effective January 2018, off-site meeting space is used only for the Bar Exam; some charges related to the Bar Exam are more efficiently handled by credit card. Similarly, catering charges for onsite meetings must usually be reserved and paid by credit card.
- Completion Date: May 2018
California State Auditor's Assessment of Annual Follow-Up Status: Partially Implemented
State Bar's revised policies provide increased controls of credit limits more than $5,000. However, State Bar policy 6.02 still allows staff to use the purchasing card for "meeting rooms and related catering services" and not bill vendors for payment for these purchases, which is the same issue that we had during the audit.
- Auditee did not address all aspects of the recommendation
1-Year Agency Response
New purchasing card policies have been implemented, and are included in Section 6.0 of the State Bar's Procurement Manual as of 2/5/2018.
- Completion Date: May 2018
- Response Date: June 2018
California State Auditor's Assessment of 1-Year Status: Partially Implemented
State Bar's revised policies provide increased controls of credit limits more than $5,000. However, State Bar policy 6.02 still allows staff to use the purchasing card for "Meeting rooms and related catering services" and not bill vendors for payment for these purchases, which is the same issue that we had during the audit.
- Auditee did not address all aspects of the recommendation
6-Month Agency Response
The State Bar is reviewing its purchasing card policies and will, by January 2018, limit purchasing card purchases of $5,000 or more to a more restricted set of expense categories, likely related to facilities and other support operations.
- Estimated Completion Date: January 2018
- Response Date: December 2017
California State Auditor's Assessment of 6-Month Status: Pending
The State Bar provides minimal explanation of the actions it is taking. We look forward to the State Bar providing a more complete description of its actions to implement our recommendations, as well as evidence of those actions, at its one-year response in June 2018.
60-Day Agency Response
The State Bar is reviewing its purchasing card policies and will, by January 2018, limit purchasing card purchases of $5,000 or more to a more restricted set of expense categories, likely related to facilities and other support operations.
- Estimated Completion Date: January 2018
- Response Date: August 2017
California State Auditor's Assessment of 60-Day Status: Pending
All Recommendations in 2017-030
Agency responses received are posted verbatim.