What every acquisition shop should know

Dan Gordon, former administrator of the Office of Federal Procurement Policy, said contract management—or post-award oversight—is essential to ensuring that the government gets exactly what it pays for.

The contracting officer’s representative (COR) is a key part of that management. However, after reviewing 20 task orders that were worth about $235.1 million, the Defense Department’s inspector general found that contracting officers and their representatives at the U.S. Army Medical Research Acquisition Activity missed the mark of good oversight.

As a result, the agency had no assurance that it got what it paid for or even that contractors were not overpaid. It's a good bet that the Army office isn't the only place in government where CORs are falling short.

The IG gave a few tips that all contracting officers and contracting officer's representatives could put to use:

Contracting officers and the CORs need to specify how they will assess contractors. They should note how they will evaluate the quality of their work and how often they will write the assessments. Those plans should also identify who’s responsible for the reports and how much detail each one needs.

CORs need to write their reports on contractors' work. The CORs did not keep written approval of deliverables on 18 task orders, which were worth $202.5 million.

“Verbal approval by the COR does not provide for a sound basis to identify what type of assessment was made in determining whether to accept or reject a deliverable,” the IG wrote.

Contracting officers need a good COR. CORs need to take their jobs seriously. The COR overseeing one of the task orders, which was worth $12.5 million, prepared a quality assurance surveillance plan only because auditors asked for one. Such a plan should be a standard practice.

“When asked why the QASP was not prepared before the task order was awarded, the COR stated that he was busy and the QASP was not a high priority for him,” the report states. “Based on the COR’s statement, he was not diligent in performing his COR tasks.”

Contracting officers need to tailor COR designation letters to each task order. The letter should lay out what is expected of a COR for each task order. The IG found a general letter for each of the orders though.

CORs needs to review invoices on orders. They need to check specifically on “other direct costs," which are costs that are not defined as material or labor. They can include things such as consultant services or travel. CORs should make sure all other direct costs are fully supported before approving the invoices and they should keep supporting documentation in the contract file.

The CORs did not conduct adequate reviews because they limited their review to the invoice charges submitted by the contractor or relied on detailed contractor cost reports without obtaining receipts, the IG found.

CORs should request and maintain receipts to verify charges billed for ODCs. Under three fixed-price task orders, the CORs approved six invoices with unsupported ODCs totaling $139,916.

The lack of supporting documentation for invoices increased the risk for improper payment. Army officials should get supporting documentation or recover the unsupported ODCs that have been paid to the contractors, the audit states.

In the report, Army officials agreed with the recommendations and plan to make policy changes.

Posted by Matthew Weigelt on Jan 03, 2012 at 10:41 AM