What to Watch for Within the Procurement & Purchasing Process

Procurement

It is important that processes are periodically reviewed to ensure controls are in place and working as they were intended. Here are things that should be considered as the procurement and purchasing processes are being reviewed.

• Are amounts reasonable for the expectations of the projects?
• Are there any unusual patterns submitted amongst bids? This could indicate collusion between contractors.
• Is the contract clear and easy to understand?
• Is there a potential for conflicts of interest?
  • Does an employee have something to gain by going with one contractor over another?
  • Is an employee being swayed by kickbacks?
• Are all bids submitted by legit vendors?
  • Some contractors may create fictitious competitors to make their bids look better.
  • Watch for unusual contractor addresses.
  • Watch for contractors with missing information.
• During the billing process, do contract invoices seem appropriate?
  • Are they in-line with the bids submitted?
  • Is the bill different from the bid without reasonable rationale?
  • Is the bill easy to understand?
  • Are invoices from contractors numbered?
  • Do bills coincide with one another? Make sure bills are not being duplicated.

Purchasing

All claims and disbursements should be reviewed and approved prior to payment. Review the following areas:

• Vendor
  • Does the vendor appear appropriate?
  • Is there a potential conflict of interest?
  • Is the vendor’s contact information correct or seem reasonable?
• Amount
  • Does the amount appear reasonable?
  • Does it match the original claim or purchase order?
• Invoice Numbering
  • Are invoices numbered?
  • Does the invoice number appear appropriate when compared to previously received invoices from the same vendor?

Our governmental audit experts are easily accessible and will quickly respond to any questions you may have. Feel free to call us toll-free at (888) 388-1040.