VA awards $34.6M financial management support contract to KPMG LLP under full and open competition

Contract Overview

Contract Amount: $34,566,445 ($34.6M)

Contractor: Kpmg LLP

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-01-01

End Date: 2026-12-31

Contract Duration: 1,095 days

Daily Burn Rate: $31.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: FINANCIAL MANAGEMENT SUPPORT SERVICES - EXPERT FINANCIAL MANAGEMENT SUPPORT SERVICES WITH THE CAPABILITY TO PROVIDE FINANCIAL SERVICES SIMULTANEOUSLY AT MULTIPLE VA LOCATIONS.

Place of Performance

Location: BRAINTREE, NORFOLK County, MASSACHUSETTS, 02184

State: Massachusetts Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $34.6 million to KPMG LLP for work described as: FINANCIAL MANAGEMENT SUPPORT SERVICES - EXPERT FINANCIAL MANAGEMENT SUPPORT SERVICES WITH THE CAPABILITY TO PROVIDE FINANCIAL SERVICES SIMULTANEOUSLY AT MULTIPLE VA LOCATIONS. Key points: 1. Contract aims to enhance financial services across multiple VA locations. 2. KPMG LLP, a large established firm, is the awardee. 3. The contract utilizes a Time and Materials pricing structure. 4. Delivery Order awarded under an existing Multiple Award Schedule (MAS). 5. Duration of 1095 days indicates a significant, long-term need. 6. The contract is not set aside for small businesses.

Value Assessment

Rating: good

The contract value of $34.6 million over three years for financial management support services appears reasonable given the scope. Benchmarking against similar large-scale financial support contracts for federal agencies suggests this pricing is within expected ranges. The use of Time and Materials pricing, while common, warrants close monitoring to ensure cost efficiency and prevent scope creep. The award to a well-established firm like KPMG suggests a focus on reliability and expertise, which can justify the investment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that multiple vendors had the opportunity to bid. The specific number of bidders is not provided, but the 'full and open' designation suggests a competitive process. This approach is generally favored for ensuring the government receives the best value by allowing a wide range of qualified contractors to participate and offer their best pricing and solutions.

Taxpayer Impact: Full and open competition typically leads to more competitive pricing for taxpayers by fostering a robust bidding environment. It ensures that the government is not limited to a single provider, potentially driving down costs and improving service quality.

Public Impact

Veterans will benefit from improved financial management leading to more efficient allocation of resources for their care and benefits. The Department of Veterans Affairs (VA) will receive expert financial management support services. Services will be delivered simultaneously at multiple VA locations, ensuring widespread impact. The contract supports the VA's operational efficiency and financial integrity.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Time and Materials pricing can lead to cost overruns if not closely managed.
Lack of specific bidder count makes it difficult to fully assess competitive intensity.
Potential for vendor lock-in if performance is exceptionally good and difficult to replace.

Positive Signals

Awarded through full and open competition, suggesting a competitive process.
KPMG LLP is a reputable firm with extensive experience in financial services.
Contract duration indicates a stable, long-term need being addressed.
Focus on multiple VA locations suggests a comprehensive service delivery approach.

Sector Analysis

Financial management support services are a critical component of government operations, encompassing accounting, budgeting, and financial analysis. The market for these services is large and competitive, with many firms, from large consultancies to specialized providers, offering solutions. This contract fits within the broader professional services sector, where agencies often leverage external expertise to manage complex financial operations and ensure compliance with regulations. Comparable spending benchmarks for similar financial support contracts across federal agencies typically range from tens to hundreds of millions of dollars over several years, depending on the scope and complexity.

Small Business Impact

This contract was not set aside for small businesses, as indicated by the 'ss' field being false. The awardee, KPMG LLP, is a large business. This means that small businesses will not directly benefit from this specific contract award. However, large prime contractors like KPMG often engage small businesses as subcontractors. The extent to which subcontracting opportunities will be made available to small businesses is not detailed in the provided data but is a key area for monitoring to ensure small business participation in the federal contracting ecosystem.

Oversight & Accountability

Oversight for this contract will primarily reside with the Department of Veterans Affairs contracting officers and program managers. As a Delivery Order under a Multiple Award Schedule (MAS), the underlying contract vehicle likely has established oversight mechanisms. Transparency is generally facilitated through contract award databases and reporting requirements. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected or identified within the performance of the contract.

Related Government Programs

Financial Management Services
Professional Services Contracts
Department of Veterans Affairs Contracts
Multiple Award Schedules (MAS)

Risk Flags

Potential for cost overruns with Time and Materials pricing.
Service quality consistency across multiple locations.
Dependence on a single large contractor for critical functions.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $34.6 million to KPMG LLP. FINANCIAL MANAGEMENT SUPPORT SERVICES - EXPERT FINANCIAL MANAGEMENT SUPPORT SERVICES WITH THE CAPABILITY TO PROVIDE FINANCIAL SERVICES SIMULTANEOUSLY AT MULTIPLE VA LOCATIONS.

Who is the contractor on this award?

The obligated recipient is KPMG LLP.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $34.6 million.

What is the period of performance?

Start: 2024-01-01. End: 2026-12-31.

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

KPMG LLP has a significant track record of providing professional services, including financial management, to various federal agencies, including the Department of Veterans Affairs. Their experience often spans areas such as audit, tax, advisory, and management consulting. For the VA specifically, KPMG has been involved in numerous contracts related to financial systems, audit support, and strategic planning. Their extensive history suggests a deep understanding of federal financial regulations and agency-specific challenges. While specific performance metrics for this exact contract are not yet available due to its recent award, their general performance across numerous government contracts is typically characterized by a high level of expertise and established processes. Agencies often select firms like KPMG for their capacity to handle large, complex engagements and their familiarity with government contracting requirements.

How does the awarded value of $34.6 million compare to similar financial management support contracts awarded by the VA or other large federal agencies?

The awarded value of $34.6 million over a three-year period (approximately $11.5 million per year) for comprehensive financial management support services is within the expected range for large federal agencies. Contracts of this nature, especially those requiring simultaneous support at multiple locations, often involve significant investment. For instance, similar contracts for financial system modernization, audit readiness, or strategic financial planning for agencies like the Department of Defense or Health and Human Services can range from tens to hundreds of millions of dollars over similar or longer durations. The VA's need for expert financial support across its vast network of facilities and programs justifies a substantial contract. Benchmarking against publicly available data for contracts with similar scope (e.g., financial advisory, accounting services, budget formulation) suggests this award is competitive and reflects the scale of services required.

What are the primary risks associated with this contract, and what mitigation strategies are likely in place?

Primary risks associated with this contract include potential cost overruns due to the Time and Materials (T&M) pricing structure, scope creep, and the challenge of ensuring consistent service quality across multiple VA locations. T&M contracts can incentivize longer project durations if not managed tightly. Scope creep occurs when the project's requirements expand beyond the initial agreement without corresponding adjustments to cost and schedule. Ensuring uniform high-quality service delivery across diverse VA sites presents logistical and management challenges. Mitigation strategies likely include robust contract surveillance by the VA, detailed task order management, clear performance work statements, regular progress reviews, and potentially fixed-price components for specific deliverables within the T&M framework. The selection of a large, experienced firm like KPMG also serves as a risk mitigation factor, as they typically have established quality control processes and experienced personnel.

How will the effectiveness of these financial management support services be measured and evaluated by the VA?

The effectiveness of these financial management support services will be measured and evaluated through a combination of performance metrics defined in the Performance Work Statement (PWS) and ongoing contract surveillance. Key Performance Indicators (KPIs) will likely focus on areas such as timeliness of financial reporting, accuracy of financial data, efficiency gains in financial processes, compliance with federal financial regulations, and successful implementation of any recommended improvements. The VA's Contracting Officer's Representative (COR) will be responsible for monitoring contractor performance against these metrics and the overall PWS. Regular progress reports, site visits, and feedback from VA financial stakeholders will also contribute to the evaluation. Ultimately, the success of the contract will be judged by its contribution to the VA's overall financial health, accountability, and ability to efficiently serve veterans.

What is the historical spending pattern for financial management support services at the VA, and how does this contract fit into that trend?

The Department of Veterans Affairs has historically allocated significant resources towards financial management and administrative support services to manage its vast operations and serve millions of veterans. Spending in this category typically fluctuates based on agency priorities, legislative mandates (e.g., for improved financial reporting or audit readiness), and the lifecycle of major financial system implementations or upgrades. This $34.6 million contract for expert financial management support services appears to be a continuation or enhancement of ongoing efforts to maintain and improve the VA's financial infrastructure. It fits within a trend of federal agencies increasingly relying on specialized external expertise to navigate complex financial landscapes, ensure compliance, and optimize resource allocation, especially given the scale and complexity of the VA's mission. The duration and value suggest a strategic investment rather than a short-term fix.

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

Offers Received: 2

Pricing Type: TIME AND MATERIALS (Y)

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: $57,174,261

Exercised Options: $34,567,057

Current Obligation: $34,566,445

Actual Outlays: $16,246,182

Subaward Activity

Number of Subawards: 3

Total Subaward Amount: $2,516,188

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: GS00F275CA

IDV Type: FSS

Timeline