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Audit of United Space Alliance's Use of Professional & Consultant Services

Press Release From: NASA Office of Inspector General
Posted: Monday, March 26, 2001

The following audit report has been posted to the NASA Office of Inspector General web site: Audit of United Space Alliance's Use of Professional & Consultant (IG-01-012, March 16, 2001)

To access the entire report, please go to: http://www.hq.nasa.gov/office/oig/hq/ig-01-012.pdf

Synopsis: The NASA Office of Inspector General has completed an audit of United Space Alliance's (USA's) use of professional and consultant services. Professional and consultant services are services performed by persons who are members of a particular profession or possess a special skill and who are not officers or employees of the contractor. We determined that controls over USA's use of professional and consultant service subcontracts need improvement. Weaknesses in the procurement and contract administration processes exist in this sensitive cost area that, taken in combination, pose a risk of abuse to NASA. We found professional and consultant service costs charged to NASA that did not meet Federal Acquisition Regulation (FAR) requirements for allowability and inadequate and untimely justifications for noncompetitive procurements of the professional and consultant services. Specifically, we found that USA officials did not maintain evidence on the nature and scope of the furnished services; maintain adequate support for decisions to noncompetitively award the service subcontracts; and prepare written justifications for the noncompetitive awards prior to initiation of the work. As a result, the $468,673 USA charged to NASA for the services may include unallowable costs and the Agency has reduced assurance that USA obtained the best available source or price for professional and consultant services.

Management's Response: NASA concurred with the findings and recommendations. The NASA administrative contracting officer, in conjunction with the DCMA, requested USA to maintain documentation identifying the nature and scope of furnished professional and consultant services. NASA also instructed USA to ensure that noncompetitive justifications (1) address efforts to identify other sources and the reasons other sources could not perform the subcontract requirements and (2) be submitted and approved prior to initiation of work. The DCAA will include professional and consultant service costs as part of the incurred cost audit for calendar year 1999. Further, the DCMA established a process to ensure that it includes these service subcontracts in reviews of USA's purchasing system.

Details on the status of the recommendations are in the recommendations section of the report (pages 3-11).

To comment on this report, please send an e-mail to igrelease@hq.nasa.gov

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