NASA contract management still at risk

NASA has plotted a course to gain control of its contract management systems— long considered a major weakness by the General Accounting Office — butthe space agency still may miss its target.

GAO, in its Jan. 17 Performance and Accountability Series report onNASA, says the agency still must do more to gain effective oversight andmanagement of contract operations.

GAO said it will continue to consider contract management at NASA ahigh-risk area.

Specific problems include NASA's lack of an efficient integrated financialmanagement system as well as its continued use of contract change ordersthat are made without negotiation first. GAO called the practice risky becauseof the potential for unanticipated new costs.

GAO said that in fiscal 1998 and fiscal 1999, NASA authorized 593 suchchanges, totaling $898 million. More than half the changes were made toadd capability to systems or revise designs to make corrections or to reducecosts, scheduling and technical problems — these changes accounted for about$368 million of the overall total, GAO reported.

In response to past GAO and NASA inspector general recommendations oncontract management, NASA began replacing its core financial managementsystem last year.

The agency is moving toward a single commercial off-the-shelf accountingsystem in place of 10 systems used by its field centers. According to GAO,however, the new system will not be fully operational until 2003.

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