Purpose

To determine the extent of implementation of the three recommendations included in our initial audit report, Contract with EBSCO Subscription Services, Inc. (Report 2007-R-6).

Background

Our initial audit report, which was issued on August 12, 2010, examined the Office of General Services’ (OGS) administration of contracts for subscription services that provided books, journals, magazines, and other literary materials to State agencies, political subdivisions, and other authorized entities. EBSCO Subscription Services Inc. (EBSCO) is the largest provider in this contract group. Its current five-year contract is valued at $140 million and expires December 31, 2015. In accordance with the contract in force at the time of our initial audit, EBSCO was authorized to charge agencies a service charge that should not have exceeded the lesser of $35 or 5 percent of the cost of each individual Title subscription. Our initial audit examined billings to one agency, the State University of New York, and found EBSCO was billing in excess of the $35 limit for individual Titles, and did not provide sufficient data to allow agencies to review the propriety and accuracy of billings. 

Key Findings

• OGS fully implemented each of the three recommendations made in our initial audit.  As a result, OGS recovered the $105,000 of overbillings cited in our initial audit, along with an additional $445,000 to cover similar estimated overcharges to all State agencies throughout the contract period.
• OGS has also revised the terms of the current contract to better address pricing of items in electronic formats.

Key Recommendations

• None

Other Related Audit/Report of Interest

New York State Office of General Services: Contract with EBSCO Subscription Services, Inc. (2007-R-6)