Deloitte Consulting LLP awarded $26.1M for accounting services to support DoD's FIAR program

Contract Overview

Contract Amount: $26,101,271 ($26.1M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Defense

Start Date: 2018-09-24

End Date: 2019-09-23

Contract Duration: 364 days

Daily Burn Rate: $71.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: IGF::OT::IGF BASE PERIOD FIAR PROGRAM SERVICES

Place of Performance

Location: ARLINGTON, ARLINGTON County, VIRGINIA, 22209

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $26.1 million to DELOITTE CONSULTING LLP for work described as: IGF::OT::IGF BASE PERIOD FIAR PROGRAM SERVICES Key points: 1. Contract value represents a significant investment in financial improvement and audit readiness. 2. Full and open competition suggests a robust market for these specialized accounting services. 3. The contract duration of one year indicates a focused effort on specific audit readiness goals. 4. The delivery order structure implies flexibility in tasking and resource allocation. 5. The contractor, Deloitte Consulting LLP, is a major player in government consulting services. 6. The North American Industry Classification System (NAICS) code 541219 points to a niche service area.

Value Assessment

Rating: good

The contract value of $26.1 million for one year of accounting services appears reasonable given the complexity of the Financial Improvement and Audit Readiness (FIAR) program. Benchmarking against similar large-scale government accounting support contracts, this award falls within expected ranges for specialized expertise. The time and materials pricing model, while requiring careful oversight, allows for flexibility in addressing evolving audit requirements. Without specific per-unit cost data, a direct comparison is challenging, but the overall value seems aligned with the scope of work.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified vendors had the opportunity to bid. The presence of four bids suggests a competitive environment for this type of specialized accounting service. A competitive process generally leads to better price discovery and potentially more favorable terms for the government. The agency's decision to use full and open competition implies confidence in the market's ability to provide suitable solutions.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best value for public funds. The multiple bids likely drove down costs compared to a sole-source award, ensuring more efficient use of taxpayer money.

Public Impact

The Department of Defense (DoD) is the primary beneficiary, aiming to achieve financial improvement and audit readiness. Services delivered include accounting expertise crucial for complex financial reporting and auditing. The geographic impact is primarily within the Department of Defense's operational areas, likely supporting its financial management functions. Workforce implications include the engagement of specialized accounting professionals from Deloitte Consulting LLP.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if time and materials are not closely managed.
Dependence on a single contractor for critical audit readiness support.
Scope creep could increase the overall cost beyond initial projections.

Positive Signals

Award to a reputable contractor with extensive experience in government accounting.
Full and open competition suggests a healthy market and potential for value.
Clear objective of achieving financial improvement and audit readiness, a key government priority.

Sector Analysis

The accounting services sector for the federal government is substantial, with agencies like the Department of Defense requiring significant support for financial management and audit readiness. This contract falls under the broader professional services category, specifically focusing on accounting and auditing support. The market for these services is competitive, with large consulting firms often vying for these high-value contracts. Comparable spending benchmarks for similar large-scale financial improvement initiatives within federal agencies can range from tens to hundreds of millions of dollars annually.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. The award to a large prime contractor like Deloitte Consulting LLP suggests that the focus was on securing specialized expertise from a major industry player. This may limit direct opportunities for small businesses to participate in this specific contract, though they may be involved in other aspects of the DoD's financial management ecosystem.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the Department of the Navy. Performance monitoring, invoicing review, and adherence to contract terms are standard accountability measures. Transparency is generally maintained through contract databases and reporting requirements. The Inspector General's office may conduct audits or investigations if any concerns regarding performance or financial impropriety arise.

Related Government Programs

DoD Financial Improvement and Audit Readiness (FIAR) Program
Federal Financial Management Systems
Government Accounting and Auditing Services
Department of Defense Financial Management

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Contract duration is relatively short (1 year), requiring potential follow-on efforts.
Complexity of the FIAR program presents inherent execution risks.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $26.1 million to DELOITTE CONSULTING LLP. IGF::OT::IGF BASE PERIOD FIAR PROGRAM SERVICES

Who is the contractor on this award?

The obligated recipient is DELOITTE CONSULTING LLP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $26.1 million.

What is the period of performance?

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

What is the historical spending trend for the DoD's FIAR program and how does this award compare?

The Financial Improvement and Audit Readiness (FIAR) program is a long-standing initiative within the Department of Defense aimed at achieving auditable financial statements. Historical spending on FIAR-related activities, including contractor support, has been substantial, often running into hundreds of millions of dollars annually across various contracts and task orders. This specific award of $26.1 million for one year represents a significant, but not unprecedented, portion of the overall FIAR budget. The trend in FIAR spending has generally been upward as the DoD progresses towards its auditability goals, with significant investments made in systems, processes, and expert support like that provided by Deloitte. This contract's value is consistent with the scale of effort required for such a critical and complex undertaking.

How does Deloitte Consulting LLP's track record in government contracting influence the assessment of this award?

Deloitte Consulting LLP is a well-established and highly regarded contractor within the federal government, with a proven track record of delivering complex professional services across various agencies. They have extensive experience in financial management, audit support, and large-scale program implementation, including significant work related to the DoD's FIAR initiative. Their past performance on similar contracts is generally considered strong, characterized by successful project completion and adherence to contractual obligations. This extensive experience suggests a lower performance risk for this specific award, as the contractor possesses the necessary expertise, resources, and understanding of government requirements to effectively execute the contract objectives. Their established presence in the government contracting space provides a degree of confidence in their ability to manage the scope and demands of this accounting services contract.

What are the key performance indicators (KPIs) likely used to measure the success of this contract?

Key performance indicators (KPIs) for this contract would likely focus on the successful execution of tasks related to the DoD's Financial Improvement and Audit Readiness (FIAR) program. These could include metrics such as the timely completion of assigned accounting tasks, accuracy of financial data processed or analyzed, adherence to audit standards, and successful support provided to internal and external auditors. Other potential KPIs might involve the development and implementation of improved accounting processes, the identification and remediation of financial statement discrepancies, and the overall contribution to the DoD's progress towards auditability. The effectiveness of the contractor's personnel in providing expert advice and support would also be a critical measure. Ultimately, the success of the contract would be judged by its tangible contribution to the DoD's ability to produce auditable financial statements.

Are there any specific risks associated with the 'Time and Materials' contract type for this service?

The 'Time and Materials' (T&M) contract type, used here, carries inherent risks, primarily related to cost control. Unlike fixed-price contracts, T&M agreements reimburse the contractor for direct labor hours at specified hourly rates and for the cost of materials. This structure can lead to cost uncertainty and potential overruns if not managed diligently. For the government, the risk is that costs could escalate beyond initial estimates if the scope of work expands or if labor hours are not efficiently utilized. To mitigate these risks, robust oversight is crucial. This includes detailed tracking of labor hours, verification of material costs, and close monitoring of task progress to prevent scope creep and ensure that the contractor is providing value for the time and resources expended. The agency must have strong project management and financial controls in place.

How does the NAICS code 541219 (Other Accounting Services) define the scope of work for this contract?

The North American Industry Classification System (NAICS) code 541219, 'Other Accounting Services,' broadly covers establishments primarily engaged in providing accounting, tax preparation, bookkeeping, and payroll services. For this specific contract supporting the DoD's FIAR program, the scope likely extends beyond basic bookkeeping. It would encompass specialized accounting advisory services, financial statement preparation and analysis, internal control assessments, audit support, and potentially the development or refinement of accounting systems and processes to meet federal financial management standards. The 'Other' designation suggests that the services required are not fully captured by more specific accounting codes and may involve a unique blend of expertise tailored to the complex financial environment of a large federal agency like the Department of Defense.

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 (UEI: 216754602)

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: $26,275,228

Exercised Options: $26,275,228

Current Obligation: $26,101,271

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $646,517

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0018918DZ013

IDV Type: IDC

Timeline