KPMG LLP awarded $17.5M for WCF Remediation Services by the Department of the Navy

Contract Overview

Contract Amount: $17,496,752 ($17.5M)

Contractor: Kpmg LLP

Awarding Agency: Department of Defense

Start Date: 2024-02-16

End Date: 2026-09-30

Contract Duration: 957 days

Daily Burn Rate: $18.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: BASE PERIOD WCF REMEDIATION SVCS

Place of Performance

Location: MCLEAN, FAIRFAX County, VIRGINIA, 22102

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $17.5 million to KPMG LLP for work described as: BASE PERIOD WCF REMEDIATION SVCS Key points: 1. Contract awarded via full and open competition, suggesting a competitive bidding process. 2. The contract is a delivery order under a larger contract vehicle. 3. Services are categorized under 'Other Accounting Services', potentially indicating financial or management consulting. 4. The contract duration is over two years, suggesting a need for sustained support. 5. The fixed-price nature of the contract shifts risk to the contractor. 6. The awardee, KPMG LLP, is a large, established professional services firm.

Value Assessment

Rating: good

Benchmarking the value of this specific delivery order is challenging without knowing the total contract vehicle value and scope. However, the fixed-price nature generally provides cost certainty. Comparing the per-unit cost would require detailed service breakdowns, which are not provided. Given KPMG's established reputation, the pricing is likely competitive within the market for similar high-level professional services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 4 bids suggests a reasonable level of competition for this specific delivery order. A competitive process generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: Full and open competition helps ensure that taxpayer dollars are used efficiently by driving down prices through market forces.

Public Impact

The Department of the Navy benefits from specialized remediation services, likely related to financial or accounting processes. This contract supports the operational efficiency and compliance of naval financial operations. The services are primarily delivered in Virginia, impacting the local professional services workforce. The contract supports the accounting and financial management sector within the federal government.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Scope creep risk if remediation tasks are not clearly defined.
Potential for cost overruns if unforeseen complexities arise, despite fixed-price structure.
Dependence on a single large contractor for critical remediation services.

Positive Signals

Fixed-price contract aligns incentives for efficient service delivery.
Award to a reputable firm like KPMG suggests a higher likelihood of successful execution.
Competition ensures a baseline level of market validation for the services and price.

Sector Analysis

The professional services sector, particularly accounting and management consulting, is a significant area of federal spending. This contract falls under the 'Other Accounting Services' NAICS code (541219), which encompasses a broad range of financial advisory and accounting support. Federal agencies frequently contract for these services to manage complex financial operations, ensure compliance, and improve efficiency. Spending in this category can range from routine audits to specialized remediation and consulting projects.

Small Business Impact

This contract does not appear to have a small business set-aside. Given the awardee is KPMG LLP, a large firm, there are no direct set-aside benefits. However, the contract may offer subcontracting opportunities for small businesses, depending on KPMG's subcontracting plan and the specific nature of the remediation services required.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy's contracting officers and program managers. The fixed-price nature provides some inherent accountability. Transparency is facilitated by public contract databases. The Inspector General's office for the Department of Defense may have jurisdiction for audits and investigations if fraud, waste, or abuse is suspected.

Related Government Programs

Financial Audit Services
Management and Financial Consulting
Accounting Services
Contract Audit Services
Financial Improvement and Audit Remediation

Risk Flags

Potential for undefined scope
Reliance on large contractor
Complexity of financial remediation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.5 million to KPMG LLP. BASE PERIOD WCF REMEDIATION SVCS

Who is the contractor on this award?

The obligated recipient is KPMG 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 $17.5 million.

What is the period of performance?

Start: 2024-02-16. End: 2026-09-30.

What specific WCF remediation services are being provided under this contract?

The provided data does not specify the exact nature of the 'WCF Remediation Services'. WCF typically refers to Working Capital Fund, which is used by some government agencies to finance revolving operations. Remediation in this context likely involves addressing issues within the financial processes, systems, or data managed by the Working Capital Fund. This could include correcting accounting errors, improving financial reporting accuracy, enhancing system controls, or addressing audit findings related to the WCF. Further details would be needed from the contract statement of work to understand the precise services.

How does the $17.5 million award compare to historical spending on similar remediation services by the Department of the Navy?

Without access to historical spending data specifically for 'WCF Remediation Services' by the Department of the Navy, a direct comparison is not possible. However, $17.5 million for a two-year engagement with a major professional services firm like KPMG suggests a significant undertaking. The Department of the Navy, like other large federal agencies, often engages in substantial financial management and remediation efforts, especially given the complexity of its operations and the stringent regulatory environment. The value is plausible for a large-scale remediation project, but context regarding the specific issues being remediated and the scope of work is crucial for a meaningful comparison.

What are the key performance indicators (KPIs) for this contract, and how will success be measured?

The provided data does not include specific Key Performance Indicators (KPIs) for this contract. Typically, for remediation services, KPIs would be tied to the successful correction of identified issues, adherence to timelines, achievement of specific financial reporting accuracy targets, successful completion of audits related to the remediated areas, and compliance with relevant regulations. The contract's success would likely be measured against the deliverables outlined in the Statement of Work (SOW) and the achievement of milestones defined therein. Performance would be monitored by the Navy's contracting officer's representative (COR).

What is KPMG LLP's track record with the Department of the Navy and similar federal contracts?

KPMG LLP is a major global professional services firm with extensive experience serving government agencies, including the Department of Defense and its components like the Department of the Navy. They regularly win contracts for a wide range of services, including financial management, audit, advisory, and IT consulting. While specific details of their past performance on 'WCF Remediation Services' for the Navy are not provided here, their consistent presence and success in winning large federal contracts indicate a strong track record and established capabilities in supporting complex government operations. Their performance on previous contracts would have been a key factor in the Navy's decision-making process.

What are the potential risks associated with this contract, and what mitigation strategies are in place?

Potential risks include the complexity of the WCF remediation, potential for scope creep if not managed tightly, and the possibility of unforeseen issues arising that could impact cost or schedule, despite the fixed-price nature. Mitigation strategies likely involve robust project management by both KPMG and the Navy, clear definition and adherence to the Statement of Work, regular progress reviews, and strong communication channels. The fixed-price contract itself mitigates some financial risk for the government by capping the cost, shifting the burden of managing unforeseen complexities to the contractor.

How does the 'Other Accounting Services' classification (NAICS 541219) influence the interpretation of this contract's value and scope?

The NAICS code 541219, 'Other Accounting Services,' is broad and encompasses a wide array of services beyond traditional bookkeeping or tax preparation. This classification suggests the contract likely involves specialized financial consulting, advisory, or remediation services that don't fit into more specific accounting categories. For this contract, it implies the services could range from financial system analysis and improvement to process re-engineering, compliance support, or addressing complex financial reporting challenges within the Navy's Working Capital Fund. The broadness of the code means the actual services performed could be quite diverse, making direct cost comparisons difficult without a detailed SOW.

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: N0018921RZ050

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 8350 BROAD ST STE 900, MCLEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $23,620,617

Exercised Options: $17,725,732

Current Obligation: $17,496,752

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $98,876

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0018922DZ015

IDV Type: IDC

Timeline