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									ICC Internal Audit Workpapers                                                                                                                  Page 1


Contributed on 14 February 2002 by Justine Blackledge, jblackledg@ipswich.qld.gov.au


Audit: Tender Processes

                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
Preparation

1. Is a tender number allocated prior to
   advertising?

2. Has the closing date and time been
   advised?

3. Does the tender documentation
   include at least
   - a description of the item for which
   tenders are to be submitted
   – tender number
   – form of agreement
   – advertisement
   – general and specific conditions of
   tendering
   – general and specific conditions of
   contract
   – tender schedules

4. Are the specifications clear,
   unambiguous and consistent with
   approved need?

5. Is the selection criteria developed

Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 2


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
     and approved before issuing
     invitations?

6. Is the selection criteria included in
   the specifications?

7. Is a clear distinction made between
   mandatory and desirable criteria?

8. Is an evaluation matrix prepared
   with appropriately weighted
   selection criteria determined from
   the specifications and conditions
   detailed in the tender
   documentation prior to advertising?

9. Are the weightings and scoring
   methods secure and inaccessible to
   potential suppliers?

10. Is the tender documentation and
    evaluation matrix reviewed by
    Contracts Branch having no
    involvement in their preparation?

11. Were end users involved in
    specifying the requirements?

12. Is there a proper separation of
    duties for the justification function
    and the decisions on how to

Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 3


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
     perform the acquisition process?


13. Are any exemptions properly
    approved, supported by documented
    analysis and consistent with
    policies?

Advertising and Inviting

14. Is the advertisement placed in the
    local newspaper? [LGA s.481]


15. Are the offers addressed to the
    Council and not to an individual?

16. Does the advertisement contain:
    - a description of the item for tender
    the tender number, officer and
    address of where to submit it, the
    closing date and time, location and
    address for inspection of tender
    documents, location and address for
    obtaining tender documents
    including the amount of the non-
    refundable deposit, name and phone
    number for enquires, a clause
    stating ‘the lowest or any tender
    will not necessarily be accepted’
    – a clause stating ‘Council reserves

Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 4


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
    the right to invite all tenderers to
    change their tender should Council
    decide to change the specs’
17. Is at least 21 days allowed from the
    day of the advertisement for the
    submission of tenders? [LGA
    s.484]

18. Does the invitation state the
    purchasing arrangement for which
    the person is tendering. [LGFS
    s.14(2)]

19. Was a policy on late or incorrect
    form of lodgement stated in the
    invitation?

20. Were any late lodgements excluded
    and is proof of lateness clear and
    factual?

21. Are enquires documented and
    treated consistently? Are enquires,
    questions and answers about the
    specification documented and
    passed on to other potential
    suppliers?

22. Are the documents sent to interested
    parties, clearly identified as to
    which are to be completed and

Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 5


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
     returned with the offer?


23. Is the receipt for the non-refundable
    deposit held for each application?

24. Is a standard covering format
    required to be included in the offers
    to aid evaluation and comparison?

25. Changes to tender is only made if
    the invitation to tender states that
    the LG might later invite all
    tenderers to change their tenders.
    [LGA s.488]

26. Are the reasons documented (ie
    public interest) if expressions of
    interest are called before tenders are
    invited [LGA s.489]

27. Properties only exempt if (1)
    disposal is to the State Govt,
    Community Org, Govt Entity, or
    Local Govt. (2) the land is not
    rateable after disposal (3)
    Ministerial exempts [LGA s.492]

Tender Receipt and Opening

28. Are tenders received in a locked

Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 6


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
    tender box that is secure from
    unauthorised access and visible by
    an officer at all times?
29. Is the person responsible for the
    safe keeping and registering of
    offers received independent from
    the officers directly involved in the
    specification and evaluation
    process?

30. Is the tender box and tenders
    opened only after the closing time?

31. Is the tender box opened by dual
    key holders?

32. Are the tenders opened at a public
    forum or closed session and in
    accordance with the method
    specified in the tender?

33. Are the tender details recorded on a
    Quotation Tender Summary Sheet?
    And is it signed by both parties who
    opened them?




Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 7


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
34. Where tender deposits are requested
    are the tenders with a copy of the
    summary sheet fowarded to Finance
    for account allocation?

35. Is the receipt number when
    receipted recorded on the tenders?

36. Are the original tenders and
    summary sheet sent to records for
    registration?

Evaluation and Assessment

37. Are the officers evaluating the
    tenders authorised to do so?

38. Are the evaluations performed by a
    panel of two or more people?

39. Is at least one person on the panel
    not a party to prior tasks in the
    process to provide an independent
    view? This person may have
    particular expertise.

40. Are the panel members from
    different parts of the Council? Do
    they have different supervisors?



Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 8


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
41. Are tenders evaluated in accordance
    with the stated specifications,
    policies and additional evaluation
    criteria being:
    - financial viability
    – production capability and capacity
    – quality system certification
    – defect reporting and rectification
    – documented past performance
    – ease of legal recourse

42. Are the tenders evaluated in
    accordance with the previously
    established matrix?

43. Are all tasks, calculations,
    deliberations etc documented?

44. Are all discussions with suppliers
    properly recorded?

45. Are the conclusions signed by all
    parties?

46. Are the deliberations kept secure,
    and access controlled from any
    person not involved in the process?

47. Is Contracts notified of changes in
    tender specifications?


Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 9


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
48. Are tender changes included in the
    annual report?

49. If tender is <$100k has the officer
    evaluating the tenders sent a Letter
    of Acceptance to the successful
    tenderer. If >$100k is a report
    submitted to Council detailing the
    tenders received, the evaluation
    process and the recommended
    supplier (if any)? Is a letter of
    acceptance sent after the Council
    decision is issued?

50. Are unsuccessful tenderers advised
    accordingly and tender deposits
    refunded?

51. Does the purchase order raised to
    the successful tenderer specify the
    contract number and retention?

52. Is the officer raising the Purchase
    Order authorised to do so?

Post Offer Negotiations

53. Were the scope and parameters for
    any negotiations predetermined as
    part of the evaluation criteria? If
    not at what stage were they?

Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 10


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
54. Were the results clearly agreed
    upon by all parties to the
    negotiations?

55. Were all negotiations adequately
    recorded and signed by all parties?

56. Was consistent and reasonable time
    given to all for negotiations?

57. Was adequate time allowed to send
    in final offers?

Post Tender Feedback

58. If an information session is held is
    the Contracts Manager plus at least
    one other officer connected to the
    tender present?

59. Has the contracts manager recorded
    the details provided at the
    information session and forwarded
    it to Records? Is the appropriate
    information released?

60. Are the reasons for any rejections
    passed on to those suppliers, in a
    form which preserves commercial
    data of the successful supplier?


Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 11


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
Monitoring the Contract

61. Is the contract signed by someone
    with appropriate delegation?

62. Was the contract properly
    witnessed?

63. Have the contract details been
    entered into Councils Contract
    Register? Check details.

64. If the contract is >2 years is Council
    satisfied that better value will be
    achieved by entering into a longer
    arrangement? [LGFS s.14(5)]

65. Is the original contract forwarded to
    and kept by the DCEO’s office and
    recorded on the register of legal
    documents ?

66. Are all copies of contracts kept in a
    secure place to protect
    commercially sensitive material? Is
    access controlled?

67. What procedures are in place to
    monitor performance in terms of the
    contract?


Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 12


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
68. Are the necessary security deposits,
    licences, insurance policies,
    certificate, qualifications etc
    obtained from the contractor?

69. Are the processes, data used and
    conclusions of supplier performance
    fully documented?

70. Are there any unsubstantiated
    opinions kept on file which could
    potentially be misused?

71. Are the results on individual
    suppliers protected from access by
    competitors?

72. Is supplier performance reviewed?


73. Are the end users involved in the
    review of supplier performance?

Progress Payments and Retentions

74. Are progress payments
    appropriately approved ?

75. Are progress payments backed up
    with an evaluation of performance,
    stage of completion etc.

Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 13


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
76. Are progress payments paid on
    time?

77. Does Council hold the appropriate
    retention from payments in
    accordance with the contract?

78. Are retention monies easily
    identified and held in an appropriate
    general ledger account?

79. Are retention monies promptly paid
    to suppliers when due?

80. Does the retentions account
    reconcile to the contracts register?

81. Are variations substantiated and
    appropriately approved?

Tender Documents

82. Are all tenderers notified if a
    change is made to the specification?

83. Variations are not allowed on
    contracts where the time for
    completion is 12 months or less?

84. Is the tender deposit or receipt for
    payment lodged with the tender?

Prepared by: Justine Blackledge                                                                                                                24 May 1999
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ICC Internal Audit Workpapers                                                                                                                  Page 14


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
85. Contract variations are not to be
    such that if it had been included in
    the original tender, more or
    different tenders would have been
    received? It can be varied in
    response to circumstances not
    known?

86. Are Security Deposits, specified in
    the specific conditions of contract,
    paid to Council within 14 days from
    the date of acceptance of the
    contract?

87. Is the security deposit appropriately
    released when the contractor has
    been paid all moneys excluding
    retention?

88. Are retention moneys as specified
    in the specific conditions of
    contract, deducted from payments
    to the contractor?

89. Is the contract performed by sub
    contractors as specified in the
    tender documentation?




Prepared by: Justine Blackledge                                                                                                                24 May 1999
(File-path: D:\Docstoc\Working\pdf\d33c9b3d-54cf-42ed-ae33-db7b2d500501.doc)
ICC Internal Audit Workpapers                                                                                                                  Page 15


                Test Questions                                                        Tender Number                                 Comments
                                                         98-99-003      98-99-041   98-99-069   98-99-095   98-99-105   98-99-221
90. Are reasons behind changes in
    times for commencement and
    completion, specified in the specific
    conditions of contract documented?

91. Does the contractor have a
    minimum of $5 million in public
    liability insurance?

92. Does the contractor have workers
    compensation insurance?

93. Is the Bank Guarantee registered on
    the ‘O’ drive in the Bonds and
    Guarantees register?

94.


95.


96.


97.




Prepared by: Justine Blackledge                                                                                                                24 May 1999
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