June 19, 2002

COMPTROLLER'S MEMORANDUM NO. 11 (2001-02)

SUBJECT: CONTRACT REVIEW PROCESS

A new Contract Review Process will be implemented, effective July 1, 2002. This process eliminates the requirement for agencies to submit a copy of the contract and any supporting documentation for contractual service contracts of $250,000 or less. Full implementation will not be required until December 1, 2002 to allow agencies time to comply with the changes.

The Contract Review Process requires the use of a completed Contract Review Checklist (Checklist). The Checklist is available on the Comptroller's web site at http://www.dbf.state.fl.us/aadir/contractindex.html. Agencies may use the short or long version of the Checklist, or they may adapt it to meet their Agency needs with the approval of the Bureau of Auditing. Agencies using an approved version of the Checklist may continue to use their approved version.

In implementing the new process, agencies should discontinue processing through the Central Contract System contracts/purchase orders that are less than or equal to $75,000. Only payments on contracts/purchase orders for contractual services in an amount greater than $75,000 will be processed through the Central Contract System.

Agencies must submit a Checklist in lieu of the contract and supporting documentation for contracts/purchase orders with amounts greater than $75,000 and less than or equal to $250,000. Contracts/purchase orders in excess of $250,000, or with open dollar amounts, require agencies to submit a Checklist, the contract, and supporting documentation.

When completing the Checklist, include all of the required contract information. The contract deliverables section should include a description of the deliverables that are specific, measurable, quantifiable and related to the scope of work. If there is insufficient space on the Checklist for items such as deliverables/milestones or payment criteria, attach pages from the contract or exhibits containing this information.

Service contracts from State Term Contracts, SNAPS, PRIDE, RESPECT, construction, and one time payments are not tracked on Central's Contract System and will not require a Checklist.

In order to review and enter information into the Central Contract System, Checklists contracts and supporting documentation must be submitted to the Bureau of Auditing prior to payment requests. This will allow for more efficient processing of contractual service vouchers and avoid delay.

Grant agreement payments made pursuant to specific statutory authority should not be processed through the Central Contract System. These payments will not require a Checklist but must contain a reference to the statute or rule authorizing the Agency to enter into the grant agreement.

The Contract Review Process will include on site reviews of Agency contractual services contracts/purchase orders and supporting documentation for compliance with State Laws and regulations. The Bureau of Auditing will notify State Agencies of the contracts/purchase orders selected for review and make arrangements to conduct the review. Agencies will be provided information regarding contract errors, omissions, and noncompliance issues.

To assist Agencies in implementing the new Contract Review Process, the Bureau of Auditing will provide training. Please contact a member of the Bureau of Auditing staff listed below or contact your Bureau of Auditing Field Office to schedule a training session.

Questions regarding the Contract Review Process may be directed to one of the following or your Bureau of Auditing Field Office:

Suzette Harris at 850-410-9314 or SUNCOM 210-9314
Carolyn Daniel at 850-410-9324 or SUNCOM 210-9324
Sandra Chapman at 850-410-9301 or SUNCOM 210-9301
Sharon Schrader at 850-410-9323 or SUNCOM 210-9323

Attachments: Guidelines for the Contract Review Process
Summary of Contract/Purchase Orders Less Than or Equal to $75,000.00

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Guidelines for the Contract Review Process

Contracts/PO for services $75,000 or less:

Contracts will not be tracked on Central's Contract System.

Contract or purchase order summary form required with each payment. (Form attached)

Contracts/PO for services in excess of $75,000 and less than or equal to $250,000:

Contracts will be tracked on Central's Contract System.

Only the Contract Review Checklist is required.

Copy of the contract and any supporting documentation is not required.

Contracts/PO for services greater than $250,000 or Open Dollar Amounts:

Contracts will be tracked on Central's Contract System.

Contract Review Checklist required.

Copy of the contract and any supporting documentation required.

New Contracts: The Contract Review Process guidelines listed above will apply.

Existing Contracts:

If the contract/purchase order is currently tracked on Central's Contract System and the contract/purchase order amount is $75,000 or less, the guidelines listed above for contracts for services of $75,000 or less will apply.

If the contract/purchase order is currently tracked on Central's Contract System and the contract amount is greater than $75,000, the contract will continue to be tracked and a Contract Review Checklist will not be required until the contract is renewed or amended.

Contract Renewal: (No change in contract terms)

If the contract/purchase order amount is $75,000 or less, the guidelines listed above for contracts for services of $75,000 or less will apply.

If the contract/purchase order amount is greater than $75,000 but less than or equal to $250,000, a Contract Review Checklist marked as a renewal with the renewal number is required.

If the contract/purchase order amount is greater than $250,000 or open dollar amount, a Contract Review Checklist marked as a renewal and a copy of the renewal is required.

Contract Amendment:

Contracts/purchase orders less than or equal to $75,000. If an amendment causes the contract amount to exceed $75,000, a Contract Review Checklist will be required. The contract will be tracked on Central's Contract System and a payment history will be required in order to record previous contract payments on the system.

If the contract/purchase order amount is greater than $75,000 and less than or equal to $250,000, a Contract Review Checklist marked as an amendment with the amended changes noted is required.

If the contract/purchase order amount is greater than $250,000, or open dollar amount, a Contract Review Checklist marked with the amendment number, with amended changes noted and a copy of the amendment is required.