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GAO-Opportunities to Improve Surveillance

GAO-Opportunities to Improve Surveillance

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a
GAO
United States Government Accountability Office
Report to the Secretary of Defense
March 2005
CONTRACTMANAGEMENTOpportunities toImprove Surveillanceon Department of Defense ServiceContracts
GAO-05-274
 
What GAO Found
United States Government Accountability Office
Why GAO Did This Study
H
ighlights
Accountability Integrity Reliability
 
www.gao.gov/cgi-bin/getrpt?GAO-05-274.  To view the full product, including the scopeand methodology, click on the link above.For more information, contact David E.Cooper at (617) 788-0555 orcooperd@gao.gov.Highlights ofGAO-05-274,a report to the Secretary of Defense
March 2005
CONTRACT MANAGEMENT
Opportunities to Improve Surveillance onDepartment of Defense Service Contracts
Surveillance varied on the 90 contracts we reviewed. Surveillance wasinsufficient on 26 of the contracts we reviewed but was sufficient on64 contracts. Fifteen had no surveillance because no personnel wereassigned such responsibilities; the other 11 had assigned personnel but couldnot provide evidence of surveillance due to incomplete documentation. Also,some surveillance personnel did not receive required training beforebeginning their assignments. According to DOD officials, insufficient surveillance occurred becausesurveillance is not as important to contracting officials as awardingcontracts and therefore, does not receive the priority needed to ensure thatsurveillance occurs. The Army, unlike the Air Force and Navy organizationswe visited, does not require surveillance personnel to be assignedresponsibility prior to contract award. We also found that surveillance personnel involved in our review were not evaluated on how well they perform their surveillance duties. Further, surveillance was usually a part-time responsibility and some personnel felt that they did not have enoughtime in a normal workday to perform their surveillance duties.DOD has taken steps to implement provisions in the National Defense Authorization Act for Fiscal Year 2002 intended to improve the generalmanagement and oversight of service contract procurement and, inOctober 2004, DOD issued a policy that emphasized the proper use of other agencies’ contracts. However, these efforts did little to improve servicecontract surveillance. On a more specific item, DOD did issue guidance thatnow requires appointment of surveillance personnel during the early planning phases of cost-reimbursable and time and materials servicecontracts. At the military service level, in April 2004, the Army revised itsacquisition instructions and began requiring surveillance on some professional support service contracts; but, the revision did not apply tothose contracts awarded before the enactment date that were still in effect.
The Department of Defense (DOD)is the federal government’s largest purchaser of contractor services,spending $118 billion in fiscal year 2003 alone—an increase of 66 percent since fiscal year 1999. DODis expected to rely increasingly oncontractors to carry out its mission.In recent reports, DOD hasidentified inadequate surveillanceon service contracts. This reportexamines how DOD managesservice contract surveillance. Itlooks at the extent of DOD’ssurveillance on a selection of service contracts, reasons whyinsufficient surveillance occurred,and efforts to improve surveillance.
What GAO Recommends
 GAO recommends that DOD:require properly trainedsurveillance personnel be assignedto service contracts by the date of contract award; ensure surveillance personnel are held accountable for their duties; ensure DOD’s servicecontract review process and data collection requirements providemore useful information; and reviseguidance on surveillance for services procured from other agencies’ contracts. DOD shouldalso direct the Army to conductsurveillance, as appropriate, onongoing Contract Advisory and Assistance Services contractsawarded before April 2004.DOD concurred with four of our recommendations and partiallyconcurred with a fifth andidentified actions it has taken or  plans to take to address them.
 
 Page i GAO-05-274 Surveillance of DOD Service Contracts
Letter
1
 
Results in Brief 2Background 4Sufficiency of Service Contract Surveillance Varied 7Contract Surveillance Not Always a High Priority 12DOD Initiatives Affecting Surveillance 13Conclusions 16Recommendations for Executive Action 16 Agency Comments and Our Evaluation 17
 Appendix I Scope and Methodology 
19
 Appendix II Roles of Contracting Officers and SurveillancePersonnel
21
 Appendix III Contracts Reviewed
22
 Appendix IV Comments from the Department of Defense
30
Tables
Table 1: Summary of Surveillance on DOD Service Contracts 8Table 2: Surveillance Personnel Training 10
Figure
Figure 1: DOD Spending on Services, FY 1999 through FY 2003 5
Contents

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