Air Force must do better job of tracking risky agreements: IG

Auditors found employees requested the agreements with insufficient supporting details and didn't adequately document risk-mitigation steps

Air Force contracting personnel often failed to complete all necessary steps to protect the service before letting a contractor begin a project even though negotiations were still under way, Defense Department auditors reported this week.

Officials at the Air Force Electronic Systems Center (ESC) need to keep tighter reins on contracting officers who issue risky undefinitized contract actions (UCAs), according to an Aug. 18 DOD inspector general report. The law allows for the pre-award agreements, which let a contractor start work and charge the government before the two parties have reached a final agreement on a contract's terms, specifications or price.

To a great extent, auditors found that ESC contracting officers had the necessary authorization and showed that prices were reasonable. However, the auditors came across 56 instances among the 41 UCAs they audited in which ESC employees did not fully comply with accompanying restrictions.


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ESC employees prepared requests to issue a UCA that provided insufficient detail to support the request, and they didn’t adequately document how they reduced the Air Force's risk by limiting the company’s profit, the report states.

“If the contractor’s reduced risk is not reflected in the negotiated profit rate, then the government could be paying too much profit to the contractor,” auditors wrote.

Furthermore, ESC staff didn't consistently manage the UCAs. Contracting employees issued agreements based on inadequate requests, and they did not appropriately define the agreements within six months as required, the report states.

The report recommends that officials establish procedures to make sure employees fully document UCAs. The report also urges officials to ensure that UCA requests include details on the adverse effects on the agency if the contracting employees don’t issue the UCA. Air Force officials agreed with the recommendations.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

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