DoD's $8.4M Invoicing Support Contract Awarded to KPMG LLP for Financial Management

Contract Overview

Contract Amount: $8,457,564 ($8.5M)

Contractor: Kpmg LLP

Awarding Agency: Department of Defense

Start Date: 2025-01-01

End Date: 2026-12-31

Contract Duration: 729 days

Daily Burn Rate: $11.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: G-INVOICING PPS SUPPORT UNDER THE SAIA BPA

Place of Performance

Location: FAIRFAX, FAIRFAX County, VIRGINIA, 22030

State: Virginia Government Spending

Plain-Language Summary

Department of Defense obligated $8.5 million to KPMG LLP for work described as: G-INVOICING PPS SUPPORT UNDER THE SAIA BPA Key points: 1. Contract focuses on essential financial management services, supporting the Defense Logistics Agency's operational efficiency. 2. Awarded under a broad SAIA BPA, indicating a pre-vetted framework for specialized support. 3. The firm-fixed-price structure aims to control costs and provide predictable spending. 4. KPMG LLP, a large established firm, brings significant resources and expertise to this engagement. 5. The contract duration of two years suggests a need for sustained financial process support. 6. Performance is located in Virginia, aligning with significant federal agency presence in the region.

Value Assessment

Rating: good

The contract value of $8.46 million over two years for invoicing and payment support services appears reasonable given the scope and the contractor's expertise. Benchmarking against similar financial management support contracts for large federal agencies suggests this pricing is within expected ranges. The firm-fixed-price contract type helps manage cost certainty for the government, reducing the risk of cost overruns compared to cost-plus arrangements.

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 specific details of the bidding process, such as the number of proposals received, are not provided, but the 'full and open' designation suggests a robust competitive environment. This approach is generally expected to yield fair market pricing and encourage innovation among bidders.

Taxpayer Impact: Full and open competition ensures that taxpayer dollars are used efficiently by fostering a competitive environment that drives down prices and improves service quality.

Public Impact

The Department of Defense, specifically the Defense Logistics Agency, benefits from improved financial processing and invoicing. Ensures timely and accurate processing of payments, crucial for maintaining supplier relationships and operational continuity. Supports the financial management infrastructure within the federal government, contributing to overall fiscal responsibility. The contract's impact is primarily administrative and financial, with indirect benefits to the broader defense supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if services become deeply integrated without clear exit strategies.
Reliance on a single large contractor for critical financial functions could pose a risk if performance falters.

Positive Signals

KPMG LLP is a reputable firm with a strong track record in government contracting.
The firm-fixed-price contract type provides cost certainty and reduces financial risk for the government.
Awarded under full and open competition, suggesting a competitive process that likely secured favorable terms.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically accounting and bookkeeping services (NAICS 541211). This sector is vital for government operations, providing essential support for financial management, auditing, and compliance. Spending in this area is consistent across many federal agencies, with significant market size driven by the complexity of government finance and regulatory requirements. Comparable spending benchmarks would involve looking at other large federal agencies' contracts for similar financial support services.

Small Business Impact

This contract was not set aside for small businesses, and the data does not indicate any subcontracting requirements for small businesses. The award to a large, established firm like KPMG LLP suggests that the primary focus was on securing specialized expertise and capacity, rather than promoting small business participation directly through this specific award. Future analysis could explore if smaller firms are involved in subcontracting roles or if similar, smaller-scale contracts are awarded to small businesses.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Logistics Agency's contracting officers and program managers. The firm-fixed-price nature of the contract provides a degree of oversight through adherence to defined deliverables and payment schedules. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Defense Logistics Agency Financial Management
SAIA BPA Task Orders
Federal Financial Management Systems
Government Invoicing and Payment Processing

Risk Flags

Potential for performance issues impacting financial operations.
Risk of cost overruns if scope is not clearly defined or managed.
Over-reliance on a single contractor for critical financial functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.5 million to KPMG LLP. G-INVOICING PPS SUPPORT UNDER THE SAIA BPA

Who is the contractor on this award?

The obligated recipient is KPMG LLP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $8.5 million.

What is the period of performance?

Start: 2025-01-01. End: 2026-12-31.

What is KPMG LLP's track record with the Department of Defense and similar federal agencies for financial support services?

KPMG LLP has a substantial history of contracting with the U.S. federal government, including the Department of Defense, across various service areas. Their experience often encompasses financial management, audit, advisory, and IT services. For financial support services specifically, they have held numerous contracts providing similar functions such as accounting, financial reporting, payment processing, and internal controls assessment. Publicly available contract databases often list their awards, demonstrating a consistent presence and capability in serving federal agencies. Their track record generally indicates a capacity to handle large, complex engagements, though specific performance metrics for individual contracts would require deeper investigation into contract performance reports and agency evaluations.

How does the value of this contract compare to other federal contracts for invoicing and payment support?

The $8.46 million contract value over two years for invoicing and payment support services is a moderate-sized award within the federal contracting landscape. When compared to similar contracts awarded by agencies like the Department of the Treasury, GSA, or other DoD components for financial management support, this value appears to be within a typical range. Larger, more comprehensive financial system implementations or agency-wide financial advisory services can run into tens or hundreds of millions of dollars. Conversely, smaller, more localized support tasks might be in the low millions or less. This specific contract's value suggests a focused scope, likely supporting a particular program, system, or operational unit within the Defense Logistics Agency, rather than an enterprise-wide overhaul.

What are the primary risks associated with this contract, and how are they mitigated?

Key risks include potential performance issues where KPMG LLP might not meet contractual obligations, leading to delays or inaccuracies in financial processing. Another risk is cost escalation, although mitigated by the firm-fixed-price structure. Over-reliance on a single contractor for critical financial functions could also be a risk if not managed properly. Mitigation strategies typically involve robust contract oversight by the Defense Logistics Agency, clear performance metrics and deliverables, regular progress reviews, and defined remedies for non-performance. The use of a firm-fixed-price contract inherently shifts much of the cost risk to the contractor. Furthermore, the contractor's established reputation and experience suggest a lower likelihood of performance failure.

How effective is the firm-fixed-price contract type in ensuring value for money for this specific service?

The firm-fixed-price (FFP) contract type is generally considered effective for ensuring value for money when the scope of work is well-defined and the risks of cost overruns are manageable. For invoicing and payment support services, where the tasks are relatively predictable, FFP provides cost certainty for the government. This means the government knows the total cost upfront, allowing for better budget planning. It incentivizes the contractor to manage its own costs efficiently to maximize profit, which can translate to better value. However, if unforeseen complexities arise that were not anticipated during the bidding process, the contractor might be less inclined to absorb additional costs, potentially leading to scope disputes or a need for contract modifications. Overall, for routine financial support, FFP is a strong choice for value.

What are the historical spending patterns for similar invoicing and payment support services within the Defense Logistics Agency or DoD?

Historical spending patterns for invoicing and payment support services within the Defense Logistics Agency (DLA) and the broader Department of Defense (DoD) typically show consistent investment in financial management capabilities. Agencies like DLA handle vast volumes of transactions, requiring robust systems and expert support to ensure accuracy and compliance. Spending in this area often fluctuates based on system modernization efforts, changes in regulatory requirements, and the overall operational tempo of the defense supply chain. Contracts for these services can range from short-term, specialized support to long-term engagements for core financial functions. Analyzing past DLA or DoD budgets and contract awards for financial services would reveal trends in investment levels and the types of support sought, often indicating a sustained need for such expertise.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Accounting, Tax Preparation, Bookkeeping, and Payroll Services › Offices of Certified Public Accountants

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

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 8350 BROAD ST STE 900, MC LEAN, 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: $14,093,940

Exercised Options: $8,457,564

Current Obligation: $8,457,564

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $452,718

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: SP470423A0506

IDV Type: BPA

Timeline