Audit blames state workers for Office Depot overcharges

The division that makes state government purchases hasn't done enough to prevent overcharges by North Carolina's office supplies vendor, says a state audit made public Wednesday.

That vendor - Office Depot - has overcharged the state $40,887 since becoming its sole vendor of office supplies, the audit says.

The audit also said the overcharges happened because the state Purchase & Contract Division, part of the Department of Administration, didn't tell Office Depot to permanently fix discrepancies between the prices it charged for certain supplies and the prices it said it would charge in its contract with the state.

Purchase & Contract workers noticed the discrepancies, the audit says, but didn't address their root causes.

"P&C does many things well," State Auditor Les Merritt said in a prepared statement. "But our audit found that their monitoring process lacked a very important element: follow-up. Follow-up ensures that the causes of errors are identified and permanently corrected. This is especially disconcerting given the fact that P&C is charged with monitoring 125 contracts with 400 vendors representing a value of $1.4 billion."

In response to the audit, Purchase & Contract said its contract with Office Depot has saved taxpayers 71 percent off the retail price of the goods it's bought. It also said it didn't agree with all of Merritt's conclusions and that its system of monitoring pricing and contracts does a good job.

This is not the first time Merritt's office has tangled with the Purchase & Contract Division. Last September, the state released an audit that said P&C failed to notice that the vendor for the state tire retread contract had increased prices.

http://www.bizjournals.com/triangle/stories/2007/05/07/daily26.html