To ensure that it accounts appropriately for information technology project costs and their related funding sources, the State Bar should develop a reasonable method for allocating information technology project costs.
The State Bar is in agreement with the recommendation that a written policy regarding cost allocation for IT projects should be adopted. Cost allocation will vary by project, but a policy requiring the funding source and cost allocation methodology for each project to be identified is consistent with the Bar's commitment to improving the fiscal and operational management of the State Bar, emphasizing integrity, transparency, accountability and excellence. This recommendation will be implemented with the submission of the Bar's final budget in February 2018.
IT projects have been fully incorporated in State Bar cost allocation methodology as reflected in the Bar's 2017 adopted budget.
Although the State Bar says it has fully incorporated IT projects into its cost allocation methodology as reflected in its 2017 adopted budget, it did not provide us with a written methodology for allocating IT project costs.
Allocation methodology completed and analysis conducted. Conclusion of the analysis was that $1,211,193 of the IT Special Assessment Fund balance should remain restricted, and $3,642,377 of the IT Improvement Fund balance should remain unrestricted.
While the State Bar provided us an updated reconciliation of its IT Special Assessment Fund and Technology Improvement Fund, it did not provide a methodology for allocating information technology projects. We will reassess the State Bar's implementation of this recommendation after the State Bar provides us with its methodology.
IT project costs have been tracked properly and separately by project in the existing Oracle financial system. Staff also reconciled and corrected the issues related to inter-fund transfers and mingling of restricted and unrestricted funds/resources in previous years. Staff is still working on a cost allocation plan for future information technology project costs, and expects to complete this effort by 9/30/2016.
Agency responses received are posted verbatim.