DoD Spends $22.6M on Accounting Services via Time & Materials Contract with Deloitte

Contract Overview

Contract Amount: $22,639,702 ($22.6M)

Contractor: Deloitte Consulting LLP

Awarding Agency: Department of Defense

Start Date: 2021-09-24

End Date: 2023-09-23

Contract Duration: 729 days

Daily Burn Rate: $31.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: FM&C LABOR

Place of Performance

Location: WASHINGTON NAVY YARD, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20374

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $22.6 million to DELOITTE CONSULTING LLP for work described as: FM&C LABOR Key points: 1. Significant contract value for accounting services. 2. Deloitte Consulting LLP is the sole awardee. 3. Contract type is Time and Materials, which can pose cost control risks. 4. The sector is professional services, specifically accounting. 5. Awarded by the Department of the Navy.

Value Assessment

Rating: fair

The Time and Materials pricing structure, without a ceiling, can lead to cost overruns if not closely managed. Benchmarking against similar accounting service contracts is difficult without more detailed scope information.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process. However, the award is a delivery order, and the specific pricing mechanisms within the Time and Materials structure will determine the final price discovery effectiveness.

Taxpayer Impact: Taxpayer funds are being utilized for accounting services. The effectiveness of the competition and the management of the Time and Materials contract will directly impact the value for money received.

Public Impact

Ensures the Department of the Navy has access to essential accounting and financial management support. Supports the operational readiness and financial integrity of naval operations. The use of a large, established firm like Deloitte indicates a focus on expertise and experience.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials pricing can lead to uncontrolled costs.
Lack of specific performance metrics makes value assessment difficult.
Limited insight into the specific services provided beyond 'Other Accounting Services'.

Positive Signals

Awarded through full and open competition.
Significant contract value suggests a critical need.
Experienced contractor selected.

Sector Analysis

This contract falls within the professional services sector, specifically accounting and financial management. Spending benchmarks for similar services can vary widely based on scope, duration, and complexity, but $22.6 million over two years for a large federal agency is substantial.

Small Business Impact

The contract was awarded to Deloitte Consulting LLP, a large business. There is no indication that small businesses were involved as subcontractors or prime contractors in this specific award.

Oversight & Accountability

The Department of the Navy is responsible for oversight. The Time and Materials contract type necessitates diligent monitoring of labor hours and rates to ensure cost efficiency and prevent potential waste.

Related Government Programs

Other Accounting Services
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Potential for cost overruns due to Time and Materials pricing.
Lack of detailed service description hinders performance evaluation.
No clear indication of small business participation.
Contract duration is substantial (2 years).

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $22.6 million to DELOITTE CONSULTING LLP. FM&C LABOR

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 $22.6 million.

What is the period of performance?

Start: 2021-09-24. End: 2023-09-23.

What specific accounting services are being provided under this contract, and how do they align with the Department of the Navy's core mission requirements?

The contract specifies 'Other Accounting Services' (NAICS 541219). While essential for financial operations, the broad categorization makes it difficult to ascertain the precise nature of the services. These likely include financial reporting, auditing support, accounting system maintenance, or advisory services critical for the Navy's complex financial management and compliance obligations.

What measures are in place to mitigate the cost risks associated with the Time and Materials contract type, given its potential for cost escalation?

Effective mitigation relies on robust oversight by the Department of the Navy. This includes strict monitoring of labor hours, verification of hourly rates against market benchmarks, and clear definition of 'materials'. Establishing cost ceilings or requiring detailed justifications for extended periods of work are crucial to control expenditures and ensure taxpayer value.

How does the $22.6 million expenditure compare to historical spending on similar accounting services by the Department of the Navy or other federal agencies?

Without specific service details, a direct comparison is challenging. However, $22.6 million over two years for accounting services represents a significant investment. Benchmarking against contracts for similar scope (e.g., financial system modernization, large-scale audit support) within DoD or other large agencies would provide better context for cost-effectiveness.

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: 1

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: $28,188,867

Exercised Options: $28,158,867

Current Obligation: $22,639,702

Subaward Activity

Number of Subawards: 2

Total Subaward Amount: $721,091

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