Report 2015-121 Recommendation 14 Responses

Report 2015-121: California Department of Veterans Affairs: The State Paid Nearly $28 Million for a Flawed System That Fails to Meet the Needs of Its Veterans Homes (Release Date: June 2016)

Recommendation #14 To: Technology, California Department of

Although the Technology Department indicated that its intent is not to outsource its statutory responsibility for IPO, in any instances where its staff conduct a portfolio review of a project's IPO, the Technology Department should, by December 2016, establish a process for its review of documents created by the agency's IPO contractor that includes verifying whether these reports include critical analysis of project progress and vendor performance so it can intervene when necessary.

Annual Follow-Up Agency Response From October 2019

The CDT Office of Statewide Project Delivery has developed written instructions to the project approvals and oversight staff using existing processes that provide the necessary controls and reporting functions to respond and address this finding and prevent the type outcome described in this report.

California State Auditor's Assessment of Annual Follow-Up Status: Fully Implemented


Annual Follow-Up Agency Response From October 2018

As indicated earlier, the Department of Technology (CDT) has no intent to outsource statutory IPO responsibility. In the unlikelihood that such an event were to occur, the CDT would exercise its authority under SAM 4940 and review third party IPO oversight documents, IPORs, PSRs, and project artifacts as guided by SIMM 45 (updated December 2017) and the project oversight review processes and methodology.

Within SIMM 45 existing and updated oversight instructions and guidance establish methods for determining and identifying variances from project cost, schedule and scope via the independent oversight project reporting (IPOR) and the Project Status Report (PSR). If a 3rd party IPO were operating in this instance, the CDT would conduct an assessment if CDT:

- Does not receive the required monthly IPO reports timely and would result in immediate escalation; or

- Receives those monthly reports and determine if they are non-compliant in form or substance with state IT policy; or

- Receives those monthly reports and if they indicate variances are unmitigated - CDT would initiate an escalation processes to address the concerns based upon overall risk to the project

California State Auditor's Assessment of Annual Follow-Up Status: Pending

The Technology Department did not provide documentation substantiating its claim of full implementation. Although its response states it would conduct an assessment of a 3rd party IPO if it outsourced this responsibility, it did not provide documentation demonstrating it has established a process for its review of documents created by an agency's IPO contractor.


1-Year Agency Response

The CDT has included language in both the State Administrative Manual (SAM)section 4940 and the Statewide Information Management Manual, section 45 to address this recommendation.

California State Auditor's Assessment of 1-Year Status: Pending

The language included in SAM 4940 states that project oversight services contracted by agency/state entities must comply with the IT Project Oversight Framework (see Statewide Information Management Manual section 45), and the requirements outlined in SAM 4910. SAM 4940 also states that the Department of Technology may conduct assessments to ensure compliance with minimum requirements. However, this section does not identify under what conditions it would do so. As a result, its process for reviewing documents created by the agency's IPO contractor, including verifying whether these reports include critical analysis of project progress and vendor performance, is incomplete. The Technology Department has indicated to us that it is revising its internal policies and expects to formally adopt them by the end of September 2017. We will reevaluate at that time.


6-Month Agency Response

The Planned Action for recommendation #14 has not been completed due to other high priority workload demands. However, development of the internal procedures are underway, and the CDT needs to extend the planned completion date that was formerly December 2016 to February 2017.

California State Auditor's Assessment of 6-Month Status: Pending


60-Day Agency Response

The CDT agrees with this recommendation. The CDT will develop internal procedures for the IPO Division staff to evaluate vendor and state entity reports, as well as any additional input that is warranted given the condition, stage and trends of a project and to document the results. The procedures will reference the IPO Division escalation process in the event such action is warranted.

Corrective Action Progress: The CDT internal procedures for the aforementioned Corrective Action Plan are currently under development.

California State Auditor's Assessment of 60-Day Status: Pending


All Recommendations in 2015-121

Agency responses received are posted verbatim.