Presented By:

Pam Gouldsberry, Contracts Group ChiefCorlee Brown, ACOLinda Rowe, ACOShirley Leonard, ACO

Risk-Based Initiative for Contract Closeout:

One CMO’s Perspective

2

Agenda

• Background – DCMA VA

• Closeout Overview from DCMA VA Perspective

• T&M Initiative

• Alternative Closeout Approaches– High Risk Contractor

– Anteon Closeout Initiative

3

Background – DCMA VA

Challenges: Unique Situation

WorkloadStaffingPrioritiesAggressive Goals

4

From Physical Completion to Closed

Final Incurred Cost Proposal Due

6 Months 4 Months

Final Voucher Due

0-12 Months

Contractor FY Ends

Physical Physical CompletionCompletion

Settlement of Final Rates

Varies

CLOSEDCLOSED

Industry

DCAA

DCMA

DFAS

Services

Process Payment of

Final Voucher

Review/Process Final Voucher

Varies due to circumstances12-24 Months

Audit of Final Incurred Cost Proposal Due

DCAA Actuals8 –12 months

Flexibly Priced Closeout Timeline

DCAA Actuals30 Days

OPRs

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Contract Closeout Key Players

ONE FOCUS

Achieving the Goal Together

Indu

stry

Indirect Cost Props Final Inv/Vchrs Pkg

Refund Checks

DFAS

Reconciliation

Final Payment

Additional Funding

Property Disposition

Replacement Funds

Acceptance

Services

Indirect Cost Audits

Final OH Rates

Subcontract Audit

FV Review

DC

AA

DC

MA

Coordinate all Closeout Actions

6

T&M Initiative

What is it?• Risk-Based Approach

• Utilize fixed labor rates• Accept provisional G&A rate

• Streamlines the Contract Closeout Process• Settlement of Rates not required • Abbreviated Final Voucher • Expedites payment and closeout

60% T&M Contracts

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T&M Initiative – Teaming for Success

• Contractor Participation

• DCMA/DCAA Kickoff meeting for initial low risk contractors

• Lack of individual contract audits is an incentive

• Communicate conflicting priorities (canceling funds, etc.)

DCAA

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T&M Initiative Process

• Selection of contractors for participation

• Performance of risk assessments

• Getting contractors to participate

• Timely submission of final vouchers

• Sampling of final vouchers

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DCAA Reduced audit effort on low risk

contractors

DCMA Reduced reconciliation effort allowing

ACO to focus on active work Prevents funds from canceling Contract closes within FAR mandated

timeframes

Contractor Abbreviated final voucher process

saving time and dollars Submit Final Voucher before Final Rate

Settlement

DCAA Reduced audit effort on low risk

contractors

DCMA Reduced reconciliation effort allowing

ACO to focus on active work Prevents funds from canceling Contract closes within FAR mandated

timeframes

Contractor Abbreviated final voucher process

saving time and dollars Submit Final Voucher before Final Rate

Settlement

Benefits

Integrated Effort - DCMA, DCAA, ContractorsIntegrated Effort - DCMA, DCAA, Contractors

PartneringBusiness

Judgement

Risk

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Results!!!

• Contractors approved (low risk) 23/55

• High risk contractors (alternative approach) 4• Contracts closed

3,151

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High Risk Alternative Approach

• Background– Contractor Cooperative– Billing System Deficiencies– Significant G&A Costs Questioned in prior

audits– Contractor unable to generate sufficient

volume of final vouchers/monthly basis

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Overview of Risk-Based Process

– Identified 341 IDIQ Delivery Orders with rates settled

– DCAA determined increment/decrement factor for each IDIQ contract

– Unbilled amount< $50,000 contractor waived payment at Basic Level

– All credits were refunded to Government

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Benefits/Results

• Contractor – Reduced Final Voucher Preparation– Closeout Backlog Decreased

• Government– <60 days over 340 Delivery Orders closed

• Wynne Phase III contracts closed (app. 200)

– Replacement funds not required– Excess funds returned to Services

14

Anteon Closeout Initiative

• Background– Low Risk Contractor– Multiple Acquisitions– Large Number of Overage Contracts with

Delinquent Final Vouchers

• Challenges– Close Large Number of Contracts (2,000+)– Meet Regulatory Requirements– Satisfy DCAA and DFAS Internal Operational

Requirements

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Anteon Closeout Initiative

• Process– MOA Between DCMA and Contractor– Agreement with DCAA and DFAS– Streamlined Submission Format– Accelerated Cumulative Allowable Cost

Worksheet (CACWS) Audit

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Anteon Closeout Initiative

• Submission Format– Use Spreadsheet Format (CACWS)– Group Like Vouchers (Credits, Debits, Zeros)– Streamlined Final Documents

• Form SF1034s, Releases, Assignment of Refunds, Rebates, and Credits)

– Deviation for Form DD 1597 (Closeout Worksheet)

– Concurrent Audit by DCAA

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Anteon Closeout Initiative

• Results– Final Vouchers with Documentation

• 2,056 Contracts• Provided by Contractor in 30 Days

– DCMA Reviewed 1,702 Final Vouchers– Currently in Payment Process

• 734 Contracts

– Closed 968 Contracts in 3 Months

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Questions