In its Semiannual Report to the Congress for the period from April 1, 2015 to September 30, 2015, GSA’s Office of Inspector General (OIG) warns the agency faces major challenges in pricing and contractor compliance within the Schedules Program. The OIG reached this conclusion based, in part, on the results of the 30 GSA Schedule pre-award audits performed during the reporting period on contracts with an estimated value in excess of $3.1B. Of the total estimated value, the OIG recommended that $195M be put to better use.
The GSA Schedule contracts continue to generate significant sales and the OIG cites commercial sales practice disclosures and Price Reductions Clause monitoring as significant risk areas. Recently, OIG auditors have also focused their attention on labor categories and ensuring that contractors are fulfilling tasks orders with personnel who meet the qualifications stated on their GSA Contract. Significant findings in the audits from this period included (1) commercial sales practices information that was not current, accurate or complete; (2) proposed labor rates that were overstated; (3) ineffective Price Reductions Clause compliance monitoring; and (4) the use of unqualified labor.
The OIG also accepted two major settlements during the report period. OIG’s Office of Investigations recovered $75.5M under the False Claims Act from VMWare and Carahsoft to resolve allegations, raised in a qui tam complaint, that the firms misrepresented their commercial sales practices and therefore overcharged the government. Dell Marketing, L.P. entered into a $14.3M settlement with the OIG after a preaward audit found that Dell had failed to grant the lowest price on contract orders and increased its contract pricing without a contract modification.
As the findings of the OIG’s report to Congress demonstrate, GSA Schedule contractors need to be diligent in the management and compliance programs for their GSA Schedule contracts, especially around the option renewal period. Aronson LLC specializes in helping companies get GSA Schedules and remain compliant with its terms and conditions.
Contact Hope Lane to find out how Aronson LLC can help you in your GSA Schedule compliance program.