Report 2012-121.1 All Recommendation Responses

Report 2012-121.1: Department of Parks and Recreation: Weak Procedures Have Led to Inconsistent Budgetary Reporting and Difficulties in Measuring the Impact of Efforts to Keep Parks Open (Release Date: February 2013)

Recommendation #1 To: Parks and Recreation, Department of

To ensure that it reports consistent amounts to Finance and the State Controller, the department's budget office should develop and implement detailed procedures that describe how to use the year-end financial statements to report prior-year accounting information to Finance. These procedures should include steps to ensure that the ending fund balances reported in the most recent governor's budget and the State Controller's budgetary report agree, and that the subsequent year's beginning fund balances in the governor's budget do not carry forward any differences.

1-Year Agency Response

The Departments Budget Office staff created procedures regarding the process for reconciling year-end financial statements between the Department of Finance (DOF) and the State Controllers Office (SCO). These procedures were created and tested when reconciling the financial statements for the last fiscal year (FY). Revisions were made, based on recent changes made by DOF, and the procedures were finalized.

Attached procedures (Fund Condition, Schedule 10R Procedures, Support Schedule 10 Procedures, and Year-End Reports) include detailed policies and procedures to ensure that the Department provides reporting of consistent amounts of prior-year accounting information, expenditures, and prior-year adjustment amounts to DOF and SCO. These procedures provide specific steps to ensure that the ending fund balances agree, and specify how to identify, investigate, resolve, and report differences by the Budget and Accounting Offices.

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

6-Month Agency Response

In addition to policies and procedures developed by the Budget Section of the Administrative Services Division, the Department of Finance has implemented a new reporting procedure through the form DF 303 that requires dual reporting from the Accounting and Budget Officers as well as validation by a higher classification in the reporting chain (i.e, Assistant Admin Deputy, Admin Deputy, Chief Deputy)of expenditures and adjustments.

Training at the Department of Finance on the new procedure was mandatory for accounting and budget personnel. DPR personnel attended the training and have incorporated the detailed procedures from the training into Department procedures.

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

Although the department's budget office has developed more detailed procedures that describe how to report prior-year accounting information to Finance, those procedures do not include steps to ensure that the ending fund balances reported in the most recent governor's budget and the State Controller's budgetary report agree. Additionally, the department's budget office has not integrated the new reporting procedures developed by Finance into their procedures.

60-Day Agency Response

The Budget office has written procedures to ensure that ending fund balances reported in the most recent governor's budget and the State Controller's budgetary report agree.

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

Although the department's budget office has developed written procedures to ensure that year-end reporting submitted to Finance is accurate and consistent with the governor's budget and the State Controller's reporting, those procedures are high-level and do not describe how the department will use its year-end financial statements to facilitate consistent reporting to Finance and the State Controller. Additionally, the procedures developed by the budget office do not ensure that the ending fund balance reported in the most recent governor's budget agrees with the ending fund balance in the State Controller's budgetary report.

Recommendation #2 To: Parks and Recreation, Department of

The department's executive management should monitor the budget process closely to prevent any future variances from established policies and procedures designed to ensure accurate reporting.

Annual Follow-Up Agency Response From September 2015

Statewide procedures and policies for ensuring accurate reporting have been established by the Department of Finance, and are outlined in the "Fund Reconciliation Guide" (see link below). This process has been occurring since the FY 2014-15 Governor's Budget development process. Departments are required to submit Detailed Fund Balance (DFB) reports (Form DF-303) for all funds that have fund condition statements in the Governor's Budget. The DFB report is used by state departments to reconcile accounting data to budgetary data. Departments use the DFB report to prepare the past year portion of Fund Condition Statements for the Governor's Budget. Submission of the DFB report to the Department of Finance requires Departmental certification that the information provided reconciles to year-end financial reports submitted to the State Controller's Office. The Department's Executive Staff provides this certification, and therefore is involved in ensuring that procedures and policies are followed.

<Attachment file size exceeds email capability, please see link for supporting document>

Fund Reconciliation Guide: http://www.dof.ca.gov/accounting/Fund%20Reconciliation/documents/DFB_Guide_August_2015.pdf

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

Annual Follow-Up Agency Response From October 2014

The Department stated that the meetings would occur after the first quarter of the FY and every month thereafter. Since the first quarter just ended, and fiscal information will not be available until the 15th of the month, none such meeting have occurred this FY. We anticipate the discussions to commence around the beginning of November. Per BL 14-16 we follow the Fund Reconciliation process to prevent future variances.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

1-Year Agency Response

At the close of the first quarter of each FY beginning in FY 2014-15, and monthly thereafter, the budget analysts will contact the District Superintendents in each of the Departments districts to discuss budget-to-actual expenditures and target-to-actual revenue. The analysts will also work with the District Superintendents to prepare both expenditure and revenue projections for the upcoming quarter. This same discussion will occur with the Deputy Director of each division within the Department.

After the close of the first quarter of each FY, and monthly thereafter, the Budget Officer will prepare a budget-to-actual expenditure and target-to-actual revenue report for review by the Executive Staff at the regularly scheduled Executive Staff Meeting. The Budget Officer will compile expenditure and revenue projections from information provided from the budget analysts.

Additionally, the Budget Officer now provides monthly budget briefings to Executive Staff, including the Director, and will provide regular status updates on the budget development to Executive and Senior Management for approval.

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

Although the department asserts that it's budget officer provides monthly budget briefings to the executive staff, the department has not provided us with documentation to demonstrate such briefings to executive staff. Additionally, the department does not address in its response our concerns that executive management monitor the budget process to prevent any future variances and ensure accurate reporting.

6-Month Agency Response

The Executive Staff receives monthly budget updates at Executive Staff Meetings. The Director receives briefings on any budgetary issues that may arise outside of the regulary scheduled briefings. BSA felt that the budget documents presented at Executive Staff Meeting were not detailed enough. The budget office has prepared more detailed budget briefing documents that will be used throughout fiscal year 13/14 for discussions.

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

Although the department provided us with examples of spreadsheets it provides to executive management as a budget update, it has not explained or demonstrated how executive management can use these spreadsheets to monitor the budget process to ensure accurate reporting and prevent any future variances from established policies and procedures. The department asserts that the executive staff receives monthly budget updates at executive staff meetings, but the documents provided only indicate that executive staff is updated with projected expenditures and revenues. Without better oversight by its executive staff, the department risks future variances in the fund balance information it reports to the Finance and State Controller.

The department's assertion that we felt the budget documents presented at executive staff meetings were not detailed enough is incorrect. As we state in the department's 60-day response and its 6 month response, the department has not provided examples for us to make such a determination.

60-Day Agency Response

The Executive Management team reviews the budget on a monthly basis at its weekly Executive Staff meeting. The budget review is scheduled for the third Tuesday of each month.

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

The department has not substantiated the budget review performed at its monthly executive staff meetings. Without documentation to support the department's assertion, we are unable to confirm that executive management is monitoring the budget process to prevent any future variances from established policies and procedures designed to ensure accurate reporting.

Recommendation #3 To: Finance, Department of

To ensure transparency and accurate reporting, in those instances when Finance believes it is necessary to adjust amounts that departments have reported for presentation in the governor's budget, causing them to be different from the amounts reported to the State Controller, Finance should develop a policy and procedures to fully disclose the need for the adjustments it makes, including a reconciliation to the amounts reported by the State Controller.

6-Month Agency Response

Policy and procedures have been developed to provide transparency of the effect of any budget or policy adjustments Finance makes that affect past year amounts shown in the fund condition statements but has not been included in the year-end financial statements submitted to the State Controller's Office (SCO). The policy and procedures will be implemented this fall for the development of the 2014-15 Governor's Budget. Also, as noted in our January 23, 2013 and April 12, 2013 responses, we have established an enhanced process for departments and Finance to reconcile fund condition statements with departments' year-end financial statements and the SCO's fund balances.

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

60-Day Agency Response

Finance has developed policy and procedures to provide transparency of the effect of any pending legislation that affects past year amounts shown in the fund condition statements but has not been included in the year-end financial statements submitted to the State Controller's Office (SCO). The policy and procedures will be implemented this fall for the development of the 2014-15 Governor's Budget. Also, as noted in the department's January 23, 2013 response, Finance has established an enhanced process for departments and Finance to reconcile fund condition statements with departments' year-end financial statements and the SCO's fund balances. Finance included a copy of the policy statement it plans to include in future budget letters and training.

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

Finance plans to implement its policy statement in the fall 2013 for development of the 2014-15 Governor's Budget. The policy statement is incomplete because it limits disclosure of changes Finance makes to the effect of any pending legislation that affects past year amounts shown in the fund condition statements but has not been included in the year-end financial statements submitted to the State Controller's Office (SCO). The policy statement does not address any other changes that Finance may potentially make to adjust amounts that departments have reported for presentation in the governor's budget.

Recommendation #4 To: Parks and Recreation, Department of

To ensure that any significant changes affecting fund balances proposed by Finance for presentation in the governor's budget are presented accurately and transparently, the department should develop procedures to require higher-level review and approval of such changes by its chief deputy director, director, and potentially the secretary for the Natural Resources Agency. The department should identify levels of significance for the proposed changes in fund balances that would trigger seeking these higher-level approvals.

Annual Follow-Up Agency Response From September 2015

The Department has implemented procedures that have been included in the Budget Offices' Desk Procedures Binder. The Budget Section has also implemented changes that will allow them to identify augmentations in fund balances more accurately and timely. Analysts within the Budget Section have been identified as fund custodians and will be undertaking a monthly reconciliation process using State Controller's Office reports and identifying any significant changes in fund balances. The analysts will work closely with the General Ledger Unit to ensure the validity of these changes and ensure that both parties are seeing the same activity. If accurate, then different levels of management will be notified depending on the percentage change to any fund's balance. See 'Fund Balance Changes Initiated by the Department of Finance' procedures for more information.

Attachment B:

Fund Balance Changes Initiated by the Department of Finance

Attachment C:

Memo Released to Budget Staff

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

Annual Follow-Up Agency Response From October 2014

If DOF presents a change to any of the fund balances that is a change of 40% or more of the Departments total budget authority, the Budget Officer will advise the Director and Agency in writing.

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

Although the department asserts that the budget officer will advise the director and agency in writing if Finance presents a change to a fund balance of 40 percent or more of the department's total budget authority, the department does not indicate that it has formalized this process in procedures. Also the department has not identified levels of significance, but rather only one level. We would have expected the department to require incrementally higher levels of review for incrementally more significant proposed changes.

Moreover, the department's change threshold of 40 percent of its budget authority may not capture changes similar to those we identified in our report. For example, the department's stated process would not have identified the change we discuss on page 29 of our report. Specifically, for fiscal year 2010-11 Finance reduced the transfer amount to the off-highway vehicle fund by nearly $55 million which contributed to the department's ending fund balance for the off-highway vehicle fund in the governor's budget being understated by more than $33 million compared to the State Controller's budgetary report. In this case, the department's proposed process would not have triggered a notification to the director and agency.

1-Year Agency Response

When the Department of Finance proposes significant changes to the Budget Office that would impact the Departments fund balances, the Budget Office will present proposed changes to the Deputy Director of Administrative Services.

The Deputy Director of Administrative Services will notify the Chief Deputy Director of any significant programmatic impacts of proposed changes to fund balances. The Chief Deputy Director would communicate with the Department of Finance and advise the Director or Agency, as needed.

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

The department has not defined what it considers a significant change that would impact the department's fund balances. As we state in our recommendation, the department should identify levels of significance for the proposed changes in fund balances that would trigger seeking these higher-level approvals. Additionally, we would have expected the department to institute a more formal approval process, such as a signature from the higher-level reviewer. Finally, although it has asserted to us the steps it would take if Finance proposed changes that would affect the presentation of fund balances, the department has not provided written procedures to address our concerns.

6-Month Agency Response

If DOF proposes a significant change affecting a fund balance the budget section works with DOF to update the fund condition statement. The discussions with DOF are reported to the Admin Deputy, Chief Deputy and Director. The DOF is responsible for implementing decisions proposed on behalf of direction from the Administration. While Executive staff at DPR is notified, they are not decision makers in the process.

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

The department has a responsibility to ensure that its financial information is presented accurately and transparently. Until the department develops procedures to require higher-level review and approval of such changes to its fund balance by its chief deputy director, director, and potentially the secretary for the Natural Resources Agency the department cannot ensure that its management will be informed of any significant changes affecting fund balances proposed by Finance and that changes are presented accurately and transparently.

60-Day Agency Response

While formal written procedures are not in place, the Director has made it clear that he is the only one with the authority to authorize changes affecting fund balances. This has been communicated to budget staff. Any recommended changes would be presented to the Deputy Director of Administration who would take the proposals forward to the Chief Deputy and Director for review and decision.

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

The department has asserted that the director communicated to the budget staff regarding the authority to authorize changes affecting fund balances. However, the department admits that no formal written procedures have been developed to address the requirement in the recommendation to develop such procedures.

Recommendation #5 To: Parks and Recreation, Department of

To ensure accurate reporting of expenditures and prior-year adjustment amounts to Finance for the governor's budget, the department's budget office should continue its planned efforts to establish policies and procedures. These procedures should include specific steps to identify, investigate, resolve, and document differences in reporting by the budget and accounting offices.

1-Year Agency Response

As with Response 1, Budget office staff created procedures regarding the process for reconciling year-end financial statements between DOF and SCO. These procedures were created and tested when reconciling the financial statements for the last FY. Revisions were made, based on recent changes made by DOF, and the procedures were finalized.

Attached procedures (Fund Condition, Schedule 10R Procedures, Support Schedule 10 Procedures, and Year-End Reports) include detailed policies and procedures to ensure that the Department provides reporting of consistent amounts of prior-year accounting information, expenditures, and prior-year adjustment amounts to DOF and SCO. These procedures provide specific steps to ensure that the ending fund balances agree, and specify how to identify, investigate, resolve, and report differences by the Budget and Accounting Offices.

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

6-Month Agency Response

The process of reporting expenditures is through the schedule 10 process. The Department has developed procedures for completing the schedule 10's to meet the DOF deadlines each year. Expenditures and prior year adjustment amounts for the funds that DPR administers are reported by producing a Fund Condition Statement. This year DOF has implemented a new reporting procedure through the DF 303 that requires dual reporting from the Accounting and Budgeting Officers with validation by an executive staff member.

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

Although the department has developed procedures for completing the schedule 10 process, those procedures do not include steps to investigate, resolve, and document any differences identified by the department. Regardless of procedures implemented by Finance, the department should develop its own procedures to ensure accurate reporting of expenditures and prior-year adjustments to Finance.

Recommendation #6 To: Finance, Department of

Finance should establish a documented process for ensuring that its staff demonstrate that they have verified that departments completed budget documents correctly. For example, Finance could establish a checklist that its staff complete to communicate that they followed specified procedures to ensure the accuracy of amounts reported by departments.

1-Year Agency Response

Procedures were implemented during the preparation of the 2014-15 Governors Budget. Finance budget analysts were required to utilize new guidelines to verify various technical budget documents submitted by the departments.

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

6-Month Agency Response

Finance has developed a checklist of reminders for review of technical budget documents. Finance budget analysts will be required to utilize this checklist to verify various technical budget documents submitted by the departments. The checklist will be implemented this fall for the development of the 2014-15 Governor's Budget.

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

Although Finance indicates that it will implement the checklist in fall 2013, it has not submitted documentation of its implementation.

60-Day Agency Response

Finance is currently drafting a checklist of reminders for review of fund condition statements. Finance budget analysts will be required to utilize this checklist to verify fund condition statements submitted by the departments. Finance plans to implement the checklist this fall for the development of the 2014-15 Governor's Budget.

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

Finance indicates it will implement the checklist in the fall. Finance has not yet provided us with a copy of the checklist it plans to implement.

Recommendation #7 To: Parks and Recreation, Department of

To ensure that it adheres to the statutory requirement to reduce services or close parks to achieve any required budget reductions in the future, the department should determine the amount necessary to fully operate its 278 parks at the 2010 level. Moreover, the department should document its calculations and ensure that they include all costs associated with the operation of parks in 2010.

1-Year Agency Response

In January 2014, the Department released its Park Unit costing report. The Department reported Park Unit cost to the Legislature and is currently working on updating the calculation methodology. The costs were reconciled with actual expenditures reported in the Governors Budget to ensure that all costs associated with the operation of parks in 2010 were captured.

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

We acknowledge the department's efforts to implement our recommendation, however, effective September 2013, state law was amended effectively removing the requirement for the department to determine the amount necessary to fully operate its 278 parks at the 2010 level. As a result of the legislation change, we consider our recommendation resolved.

6-Month Agency Response

On August 1, 2013 all Districts reported 2010 expenditures to the park unit level. Headquarters is applying overhead by park unit level and will produce a report due to the legislature in December of 2013 that will include all expenditures at a park unit level. The Department previously developed and documented the methodology by which the 2010 expenditures would be reported.

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

Although the districts reported fiscal year 2010-11 expenditure information to the department, some individual park unit expenditures are not complete. Specifically, not all of the districts allocated their overhead to the individual parks. Also, the department has not yet allocated its headquarters overhead expenditures to the park units.

60-Day Agency Response

A methodology for reporting expenses at the park unit level has been tested and verified. Field personnel started working on the 2010 expenditures to report them at the park unit level on July 1, 2013 with an estimated completion date in August, 2013.

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

The first phase of the process that the department plans to use for calculating park unit costs details how districts will calculate the cost to run each park unit during fiscal year 2010-11, and includes an expected completion date of August 2013. However, the methodology does not specify whether the department will ensure that all of the individual park unit costs for 2010-11 reconcile with the total costs associated with the operation of parks in 2010.

Recommendation #8 To: Parks and Recreation, Department of

To address the possibility of any future park service reductions or closures, the department should develop a detailed process for evaluating the criteria that it must consider in selecting parks for reduced services or park closures. To ensure transparency to the public and to demonstrate that it followed its process, the department should also document the details of its analyses that support its selection of parks for reduced services or closures.

1-Year Agency Response

Attached are guidelines for Park Closure Considerations which include the following consideration: If budget reductions necessitate changes to the continued operation of State Park Units, the Department will attempt to achieve required budget reductions by implementing efficiencies and increasing revenue collection, or reducing services at selected units of the State Park System. If, after considering all other options, a team would be created to objectively evaluate criteria for possible park closure. Members may include, but not be limited to, the Chief Deputy Director, Deputy Director of Park Operations, Northern Field Division Chief, Southern Field Division Chief, and the Deputy Director of Administrative Services. The Department will present its findings to the Parks and Recreation Commission at a public hearing. Information gathered at the hearing will be considered by the Department before any final decision regarding the proposed closure of a park unit.

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

After our report was released, state law was amended to require the department to perform actions similar to those specified in our recommendation. Therefore, based on the new statutory requirements and the department's response that it would present findings at a public hearing if park closures were proposed, we consider this recommendation resolved.

6-Month Agency Response

The Department has assembled a team to recommend and evaluate criteria to be considered if future park service reductions or closures should be necessary. The team will is documenting its efforts in the interest of transparency.

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

As we state in our recommendation, the department should develop a detailed process for evaluating the criteria that it must consider in selecting parks for reduced services or park closures. Because state law already outlines the criteria the department must consider in selecting parks for reducing services or closing parks, we are confused by the department's statement that its team will be recommending and evaluating criteria.

Recommendation #9 To: Parks and Recreation, Department of

To assure the Legislature and the public that future proposed park service reductions and closures are appropriate to achieve any required budget reduction, the department should develop individual park operating costs and update these costs periodically. These individual park costs should include all direct and indirect costs associated with operating the park, and the aggregated costs of all the individual parks should correspond with the related fiscal year's actual expenditures needed to operate the department's park system. Additionally, when proposing park service reductions or closures in the future, the department should compare the most recent cost estimates to the amount the department determines is necessary to fully operate its 278 parks at the 2010 level to determine the actual amount of the reductions or closures needed.

1-Year Agency Response

In January 2014, the Department released its Park Unit costing report. The increased level of fiscal information provided in this report and in the future will allow for a greater understanding regarding how departmental funding is allocated amongst the various State parks in support of Californias State Park System.

In developing this report, the costs for the park system fall into two main categories of expenditures:

Direct Expenditures - These are the direct expenditures for providing services in a park unit, from the district level down—identified as staffing and operating expenses in this report.

Indirect Overhead Expenditures - These include the cost of support services for the park unit and support provided by the Departments Headquarters operation—identified as distributed admin and core programs in this report.

The Departments Fiscal Tracking System, reports expenditures to the district level of the State Park System. The Department developed estimates for how those expenditures should be distributed among the various parks in the system. Included in the report is the Departments estimate of how the district expenditures are distributed among the parks for both FY 2010-11 and projected for FY 2013-14. The Departments examination of the State Park Systems budget focused on the support budget expenditures—not Capital Outlay or Local Assistance Expenditures—in order to capture those costs that best reflect the costs of operating individual parks within a park system. Going forward, the Department is tracking expenditures for the park system at the park unit level and will release expenditures at this the park unit level annually.

In 2013, the Public Resources Code 5007 was amended resulting in the deletion of the requirement to compare most recent cost estimates to the amounts determined necessary to fully operate our parks at the 2010 level when proposing park service reductions or closures.

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

The department provided us with park operating costs for fiscal year 2010-11 which met our expectations and while we acknowledge the department's efforts to implement our recommendation, effective September 2013 state law was amended removing the requirement for the department to determine the amount necessary to fully operate its 278 parks at the 2010 level. As a result, that portion of our recommendation has been resolved.

The department also provided us with projected park costs for fiscal year 2013-14 which also appear to meet our expectations. We have assessed this recommendation as fully implemented provided the department continues with its current methodology to determine park operating costs and report those amounts to the Legislature beginning in fiscal year 2013-14, as we recommended in a subsequent report dated September 2013 (Department of Parks and Recreation: Flaws in Its Budget Allocation Processes Hinder Its Ability to Effectively Manage the Park System, Report 2012-121.2).

6-Month Agency Response

On July 1, 2013 the Department began reporting expenditures for the fiscal year 2013/14 by park unit. These costs will be tracked at the park unit throughout the year and will correspond with the fiscal year's actual expeditures. The 2013/14 expenditures will be compared to the 2010 expenditures after June 30, 2014, the close of the fiscal year. Budgets for individual park units will be compiled from the data and year by year comparisons will be made going forward.

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

The department provided us with a three-phase methodology which it is in the process of implementing. For phase one (calculating fiscal year 2010-11 expenditures by park unit) the department has collected park level expenditures for fiscal year 2010-11 from its park districts. However, the expenditures are not yet complete because not all of the districts allocated their overhead to the individual parks and the department has not yet allocated its headquarters overhead costs to the parks. Additionally, the department has not identified a process for ensuring that the total fiscal year park level expenditures reconcile with the corresponding fiscal year's actual expenditures. For phase two (defining process to track current year expenditures), although the department requires the park districts to begin tracking expenditures by park unit beginning July 1, 2013, it does not expect to compare the fiscal year 2013-14 expenditures to the 2010 expenditures until after the close of the fiscal year. For phase three (developing budgets for individual parks) the department indicates that year by year comparisons will be made going forward but does not provide any specifics or timeframes. The department has not provided documentation to substantiate its claim of fully implemented.

60-Day Agency Response

A methodology for reporting expenses at the park unit level has been tested and verified. Field personnel will be tracking expenditures at the park unit level for all fiscal years starting with the current 2013/14 budget year. By tracking costs at the park unit level the department will be able to compare current costs with those of the 2010 level at which Parks were operating.

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

Although the department has established a methodology to address our concern and its need to identify operating costs at the park unit level, the department is still in the process of implementing its three phase approach. Specifically, the department has collected park level costs for fiscal year 2010-11 from its park districts but not all of the districts allocated their overhead to the individual parks. Also, the department has not yet allocated its headquarters overhead costs to the park level. Additionally, the department has not identified a process for ensuring that the total fiscal year park level costs reconcile with the corresponding fiscal year's actual expenditures. Further, for the second phase the department required every section, headquarters and field personnel, to begin tracking expenditures by park unit wherever possible starting July 1, 2013. However, it has not provided documentation to substantiate its claim.

All Recommendations in 2012-121.1

Agency responses received after June 2013 are posted verbatim.