Deloitte Consulting LLP awarded $25M for FIAR Program Services, highlighting accounting support needs

Contract Overview

Contract Amount: $25,080,604 ($25.1M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Defense

Start Date: 2018-09-24

End Date: 2019-03-23

Contract Duration: 180 days

Daily Burn Rate: $139.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: FIAR PROGRAM SERVICES - BASE PERIOD

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22209

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $25.1 million to DELOITTE CONSULTING LLP for work described as: FIAR PROGRAM SERVICES - BASE PERIOD Key points: 1. Contract value appears reasonable for specialized accounting and financial improvement services. 2. Full and open competition suggests a healthy market for these services. 3. Potential risk indicators include the time-and-materials pricing structure. 4. Performance context is within the Department of Defense's ongoing financial improvement initiatives. 5. This contract falls within the professional services sector, specifically accounting support. 6. The award was a delivery order against a larger contract vehicle.

Value Assessment

Rating: good

The contract value of approximately $25 million for a six-month period is within a typical range for large-scale financial improvement and audit readiness (FIAR) program support. Benchmarking against similar contracts for accounting and financial consulting services to federal agencies suggests this pricing is competitive, especially given the specialized nature of FIAR. The time-and-materials (T&M) pricing, while common, warrants scrutiny for cost control over the contract duration.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of four bidders suggests a competitive environment for this type of service. This level of competition is generally favorable for price discovery and ensuring the government receives a fair market price for the services rendered.

Taxpayer Impact: Taxpayers benefit from full and open competition as it drives down costs through market forces and encourages a wider pool of contractors to offer their best pricing and innovative solutions.

Public Impact

The Department of Defense is the primary beneficiary, receiving critical support for its financial improvement and audit readiness programs. Services delivered include accounting expertise, financial system analysis, and audit support, essential for meeting federal financial management requirements. The geographic impact is primarily within the Department of Defense's operational areas, though the contractor's personnel may be located remotely or at various government sites. Workforce implications include the engagement of highly skilled accounting and financial professionals, potentially creating opportunities for specialized roles within Deloitte.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time-and-materials pricing can lead to cost overruns if not closely monitored and managed.
The short duration of the base period (180 days) might indicate a need for follow-on work or potential for contract modifications.
Reliance on a single large contractor for critical financial services could pose a risk if performance issues arise.

Positive Signals

Awarded under full and open competition, suggesting a robust selection process.
The contractor, Deloitte Consulting LLP, is a well-established firm with significant experience in government contracting.
The contract supports a critical government function (FIAR), indicating alignment with strategic objectives.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically focusing on accounting and financial consulting. The market for these services within the federal government is substantial, driven by mandates for improved financial transparency and auditability. Comparable spending benchmarks for similar large-scale financial improvement projects within the Department of Defense often run into tens or hundreds of millions of dollars annually, making this $25 million award for a base period a significant but not extraordinary investment.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. The prime contractor is Deloitte Consulting LLP, a large business. There is no explicit information provided regarding subcontracting plans for small businesses. The impact on the small business ecosystem is likely minimal for this specific award, as the primary focus is on large-scale professional services typically handled by major consulting firms.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA) and the contracting officer within the Department of Defense. Accountability measures are embedded in the contract terms, including performance standards and reporting requirements. Transparency is facilitated through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

Financial Improvement and Audit Readiness (FIAR) Programs
Department of Defense Financial Management
Accounting and Auditing Services
Federal Financial Management Modernization

Risk Flags

Time and Materials Pricing
Short Contract Duration (Base Period)
Reliance on External Expertise for Critical Function

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $25.1 million to DELOITTE CONSULTING LLP. FIAR PROGRAM SERVICES - BASE PERIOD

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $25.1 million.

What is the period of performance?

Start: 2018-09-24. End: 2019-03-23.

What is Deloitte Consulting LLP's track record with the Department of Defense for similar financial services contracts?

Deloitte Consulting LLP has a substantial track record of performing financial services for the Department of Defense and other federal agencies. They are frequently awarded contracts related to financial improvement, audit readiness, system modernization, and management consulting. Their experience often includes supporting complex programs like FIAR, where they leverage their expertise in accounting standards, federal regulations, and IT integration. Publicly available data indicates numerous awards to Deloitte for similar services, often in the multi-million dollar range, underscoring their established presence and capabilities within the defense sector.

How does the $25 million value compare to other FIAR support contracts awarded by the DoD?

The $25 million value for this base period of FIAR Program Services is significant but falls within the expected range for large-scale support initiatives within the Department of Defense. DoD's FIAR efforts are complex and span multiple years, often involving substantial investments. Contracts for similar comprehensive support, including system implementation, process re-engineering, and audit liaison, can range from tens to hundreds of millions of dollars annually across various components of the DoD. This award represents a portion of the overall investment required to achieve auditability, and its value should be considered in the context of the broader, long-term FIAR strategy.

What are the primary risks associated with this specific contract, considering its scope and pricing structure?

The primary risks associated with this contract include potential cost overruns due to the time-and-materials (T&M) pricing structure, which lacks a fixed ceiling for labor hours. Scope creep is another risk, where the requirements may expand beyond the initial definition, leading to increased costs and extended timelines. Contractor performance is also a risk; while Deloitte is experienced, any disruption or underperformance in delivering critical FIAR services could impact the DoD's auditability goals. Finally, the short base period (180 days) suggests a potential for contract modifications or follow-on orders, which introduces uncertainty regarding the total contract value and duration.

How effective are contracts like this in helping the DoD achieve its FIAR objectives?

Contracts like this are crucial for the DoD to achieve its FIAR objectives, as they provide specialized expertise and resources that may not be available internally. These services are essential for navigating the complexities of federal financial management regulations, implementing necessary system changes, and preparing for independent audits. The success of such contracts hinges on clear performance metrics, effective government oversight, and strong contractor performance. While external support is vital, the ultimate achievement of FIAR goals also depends on internal DoD commitment, process improvements, and data integrity.

What are the historical spending patterns for FIAR Program Services within the DoD, and how does this award fit?

Historical spending patterns for FIAR Program Services within the DoD show a consistent and significant investment over many years, reflecting the ongoing challenge of achieving auditability. Annual spending across the DoD for FIAR-related activities, including contractor support, system development, and internal resources, often amounts to billions of dollars. This $25 million award for a six-month base period represents a specific task order within that larger spending landscape. It aligns with historical patterns of utilizing external expertise to supplement internal efforts and address specific program requirements, such as those outlined in this delivery order.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Accounting, Tax Preparation, Bookkeeping, and Payroll Services › Other Accounting Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: N0018915RZ006

Offers Received: 4

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte Financial Advisory Services LLP

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $26,886,170

Exercised Options: $26,886,170

Current Obligation: $25,080,604

Actual Outlays: $1,437,307

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0018918DZ013

IDV Type: IDC

Timeline