An audit released by the Deputy Assistant Inspector General (DAIG) for Acquisition Audits on February 3, 2012 questions the Multiple Award Schedule  (MAS) Program Industrial Funding Fee (IFF).

The DOD IG has substantiated two of three allegations in a hotline complaint which alleged that a Defense Contract Audit Agency (DCAA) audit team in the mid-Atlantic region failed to provide adequate audit services. IG substantiated that the DCAA audit team (1) provided inadequate audit assistance in closing contracts by not reviewing final vouchers in a timely manner and (2) inappropriately canceled its review of a progress payment based on direction from a contracting officer who did not have the authority to cancel it.

According to the Department of Defense Inspectory General, over 80% of the undefinitized contractual actions (UCAs) entered into over a six-year period did not meet statutory and procedural requirements. Consequently, the Inspector General has concluded that DOD assumed additional cost risk, may have paid excessive profits and may have paid more than fair and reasonable prices.

According to the Department of Defense Inspectory General, over 80% of the undefinitized contractual actions (UCAs) entered into over a six-year period did not meet statutory and procedural requirements. Consequently, the Inspector General has concluded that DOD assumed additional cost risk, may have paid excessive profits and may have paid more than fair and reasonable prices.

The most common failures were not definitizing actions within the 180-day time frame and failure to determine whether contractor profits reflected work performed during the undefinized period. Other problems included improper justification to issue a UCA and failure to adequately support UCA authorization requests.  

According to the DOD Inspector General (IG), DCAA tacks agency-wide guidelines on the timeliness of data tested during audits of contractor systems. Furthermore, the lack of guidelines delays DCAA contractor business system reviews. The Director of DCAA has agreed and promised guidance by November 2011 (tomorrow).