Defense Acquisitions: Continued Management Attention Needed to Enhance Use and Review of DOD's Inventory of Contracted Services Page: 2 of 39
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cK Q DEFENSE ACQUISITIONS
Continued Management Attention Needed to
Highlights Enhance Use and Review of DOD's Inventory of
Highlights of GAO-13-491, a report to
Why GAO Did This Study
DOD is the government's largest
purchaser of contractor-provided
services. In fiscal year 2011, DOD
reported $199 billion in obligations for
service contracts, which include
services as varied as medical services
and intelligence support. In 2008,
Congress required DOD to compile
and review an annual inventory of its
contracted services to include the
number of contractors providing
services to DOD and the functions
these contractors were performing.
The 2010 National Defense
Authorization Act directed GAO to
report for 3 years on these inventories.
For this third report, GAO assessed
(1) the progress DOD has made in
compiling the fiscal year 2011
inventory of contracted services and
efforts to collect contractor manpower
data, and (2) the extent to which
defense components complied with
DOD's guidance for reporting on their
inventory reviews. GAO reviewed
relevant laws and guidance, analyzed
inventory submissions from 31
components, reviewed component
certification letters, and interviewed
DOD acquisition and manpower
What GAO Recommends
GAO recommends that the Secretary
of Defense direct component heads to
discuss in their certification letters all
required inventory review elements, as
well as how instances where
contractors are performing inherently
governmental functions were resolved.
DOD generally concurred with our
recommendations, but indicated that
the Secretary's involvement was not
necessary. GAO believes it is, as
discussed in the report.
View GAO-13-491. For more information,
contact Timothy J. DiNapoli at (202) 512-4841
What GAO Found
Over the past year and a half, the Department of Defense (DOD) has taken steps
to implement its plan to collect contractor manpower data directly from
contractors and to develop and implement a department-wide system, based on
the Army's existing system, to collect and store these and other inventory data.
DOD officials estimate that the data system will be available in fiscal year 2014,
with DOD components reporting on most of their service contracts by fiscal year
2016. DOD, however, is still working on key decisions related to security,
funding, and other technological issues and has not developed a plan of action
with anticipated time frames and necessary resources to help ensure DOD
remains on track to meet its goals. Making timely decisions and developing a
plan of action with anticipated timeframes and necessary resources, as GAO has
previously recommended, would facilitate DOD's stated intent of implementing a
DOD-wide system to collect required inventory information. For the fiscal year
2011 inventory, DOD components generally used the same compilation
processes used in the previous year. As such, with the exception of the Army,
which already has an inventory data collection system, the remaining
components relied primarily on the Federal Procurement Data System-Next
Generation (FPDS-NG). GAO previously reported that FPDS-NG has several
limitations, including the inability to identify more than one type of service in a
contract or the number of contractor full-time equivalents (FTE), which limit its
utility for purposes of compiling a complete and accurate inventory.
Consistent with DOD's December 2011 guidance, 29 of the 31 components
submitted letters certifying that they had conducted an inventory review as of
April 2013. DOD officials stated that the requirement to submit certification letters
represented a significant improvement over prior years' reviews, when DOD
could not determine whether the required reviews were conducted. These
officials also stated that the letters provided useful insights into the components'
efforts. GAO's analysis, however, indicates that none of the components'
certification letters discussed all six elements required by DOD's guidance. For
example, GAO's analysis found that the letters generally provided only limited
information on their review methodologies or the results of their review efforts. In
addition, it is unclear based on the information provided in the certification letters
the extent to which the differences in the methodologies components used to
conduct the reviews contributed to the variation in the identification of contractors
performing inherently governmental functions, unauthorized personal services, or
closely associated with inherently governmental functions. For example, the
Army, using its review process, identified over 44,000 contractor FTEs
performing closely associated with inherently governmental functions, while the
Air Force identified about 1,400 contractor FTEs and 13 components reported
they had no contractors performing these functions. Further, the Army and the Air
Force did not provide complete information on actions taken to resolve instances
where they had identified contractors performing inherently governmental
functions as part of their reviews, such as by transferring performance of these
functions to DOD personnel or modifying the contract's statement of work. The
ability to identify contractors performing these functions is valuable as it allows
actions to be taken, but that value is significantly reduced if decision-makers
have no assurance as to whether corrective actions were taken.
United States Government Accountability Office
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United States. Government Accountability Office. Defense Acquisitions: Continued Management Attention Needed to Enhance Use and Review of DOD's Inventory of Contracted Services, report, May 23, 2013; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc302166/m1/2/: accessed January 17, 2019), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.