DoD's $22.5M contract for PMO services awarded to KPMG LLP shows fair value despite limited competition
Contract Overview
Contract Amount: $22,510,755 ($22.5M)
Contractor: Kpmg LLP
Awarding Agency: Department of Defense
Start Date: 2014-09-04
End Date: 2019-09-03
Contract Duration: 1,825 days
Daily Burn Rate: $12.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 4
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: IGF::OT::IGF FIAR PMO SERVICES
Place of Performance
Location: WASHINGTON NAVY YARD, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20374
Plain-Language Summary
Department of Defense obligated $22.5 million to KPMG LLP for work described as: IGF::OT::IGF FIAR PMO SERVICES Key points: 1. Value for money appears reasonable given the scope of program management support. 2. Competition was limited, potentially impacting price discovery and taxpayer value. 3. Risk indicators are moderate, with performance history needing close monitoring. 4. The contract's duration and cost structure warrant scrutiny for efficiency. 5. This contract fits within the broader IT and professional services sector for defense. 6. Oversight mechanisms are in place, but transparency could be enhanced.
Value Assessment
Rating: fair
The contract's total value of $22.5 million over five years suggests a moderate annual spend of $4.5 million for program management support. Benchmarking against similar large-scale program management contracts within the Department of Defense is challenging without more granular data on specific deliverables. However, the cost-plus-fixed-fee structure implies that while direct costs are reimbursed, the fixed fee provides a ceiling on contractor profit, which can be a reasonable approach for complex services. Further analysis would require comparing the specific services rendered against industry standards and the efficiency of the fixed fee component.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The data shows 4 bids were received, suggesting a reasonable level of competition for this type of specialized service. While not a highly contested bid, the presence of multiple bidders generally helps in achieving a more competitive price. The specific details of the bidding process and the evaluation criteria would provide further insight into how effectively this competition translated into optimal value for the government.
Taxpayer Impact: The full and open competition, with multiple bidders, suggests that taxpayers likely benefited from a more competitive pricing environment than would have occurred under a sole-source or limited competition scenario.
Public Impact
The Department of the Navy benefits from enhanced program management capabilities. Services delivered support critical defense initiatives and operational readiness. The contract's impact is primarily concentrated within the Washington D.C. metropolitan area. Workforce implications include the employment of skilled program managers and support staff.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can incentivize cost overruns if not closely managed.
- The duration of the contract (5 years) requires ongoing performance monitoring to ensure continued value.
- Limited public detail on specific performance metrics makes independent assessment difficult.
Positive Signals
- Awarded through full and open competition, ensuring a broad range of potential contractors.
- The fixed fee component provides a degree of cost certainty for the government.
- KPMG LLP is a well-established firm with significant experience in government contracting.
Sector Analysis
This contract falls within the professional, scientific, and technical services sector, specifically engineering services (NAICS 541330), which is a significant component of federal IT and defense spending. The market for these services is large and competitive, with numerous firms offering program management and technical consulting. Federal spending in this area often supports complex acquisition programs, research and development, and operational support for various agencies. Benchmarking against similar contracts would involve looking at other large program management support awards within the Department of Defense and other federal agencies.
Small Business Impact
The contract was awarded under full and open competition and does not indicate a specific small business set-aside. There is no explicit information provided regarding subcontracting plans for small businesses. Without this data, it's difficult to assess the direct impact on the small business ecosystem. However, large prime contractors like KPMG LLP often engage small businesses for specialized support, which could indirectly benefit them.
Oversight & Accountability
The Department of Defense employs various oversight mechanisms for contracts, including contract officer representatives (CORs) and program management reviews. Inspector General (IG) jurisdiction would apply in cases of fraud, waste, or abuse. Transparency is generally facilitated through contract award databases like FPDS, but detailed performance reports and specific cost breakdowns are often not publicly available. The fixed-fee structure itself provides a level of accountability by capping contractor profit.
Related Government Programs
- DoD Program Management Support Services
- Federal Engineering and Consulting Contracts
- IT Program Management Support
- Defense Acquisition Support
Risk Flags
- Cost-plus-fixed-fee structure requires diligent oversight to manage costs.
- Contract duration necessitates ongoing performance monitoring.
- Limited public data on specific performance metrics hinders independent assessment.
Tags
defense, department-of-defense, department-of-the-navy, professional-services, engineering-services, program-management, cost-plus-fixed-fee, full-and-open-competition, delivery-order, washington-dc, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $22.5 million to KPMG LLP. IGF::OT::IGF FIAR PMO SERVICES
Who is the contractor on this award?
The obligated recipient is KPMG LLP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $22.5 million.
What is the period of performance?
Start: 2014-09-04. End: 2019-09-03.
What is KPMG LLP's track record with similar large-scale federal contracts, particularly within the Department of Defense?
KPMG LLP has a substantial history of contracting with the federal government, including the Department of Defense. They are a large, well-established professional services firm with expertise in areas such as financial management, IT consulting, and program management. While specific details on past performance for contracts of this exact size and scope are not provided here, their extensive experience suggests a capacity to handle complex requirements. Federal procurement data typically shows KPMG winning numerous contracts across various agencies. A deeper dive into their past performance reviews and any documented issues on prior DoD contracts would be necessary for a comprehensive assessment of their track record.
How does the $22.5 million total contract value compare to similar program management support contracts awarded by the DoD?
The $22.5 million total contract value over five years equates to an average annual value of $4.5 million. This figure is moderate for large-scale program management support within the Department of Defense, which often awards contracts in the tens or hundreds of millions of dollars for major acquisition programs or enterprise-wide support. However, the complexity and specific services required heavily influence contract value. Without knowing the precise scope of 'IGF::OT::IGF FIAR PMO SERVICES,' direct comparison is difficult. It suggests a significant but not necessarily top-tier program management engagement compared to the largest defense contracts.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract of this nature?
The primary risk with a Cost Plus Fixed Fee (CPFF) contract is that the contractor may have less incentive to control costs compared to a fixed-price contract, as all allowable costs are reimbursed. The 'cost' portion means the government bears the risk of cost overruns. However, the 'fixed fee' provides a ceiling on the contractor's profit, which mitigates some of the unlimited profit risk. Effective management by the government requires rigorous oversight of incurred costs and performance to ensure the contractor remains efficient and does not inflate expenses to increase the base upon which the fee is calculated. Close monitoring of the Statement of Work (SOW) and deliverables is crucial.
How effective has the 'full and open competition' process been in ensuring competitive pricing for this specific contract?
The contract was awarded under 'full and open competition,' with four bids received. This indicates that the process allowed for a broad range of potential offerors, which is generally conducive to competitive pricing. Having multiple bidders (four in this case) suggests that the government received various proposals and pricing structures, allowing for comparison and negotiation. While 'full and open' is the preferred method for maximizing competition, the actual effectiveness in achieving the best price depends on factors like the specificity of the requirement, the clarity of the solicitation, and the number and capability of the bidders. Four bidders is a reasonable number, but more could potentially yield even better price discovery.
What are the historical spending patterns for 'IGF::OT::IGF FIAR PMO SERVICES' or similar program management support within the Department of the Navy?
Historical spending data for 'IGF::OT::IGF FIAR PMO SERVICES' specifically is not detailed in the provided information. However, the Department of the Navy, like other branches of the DoD, consistently spends significant amounts on program management support services. These services are crucial for managing complex defense acquisition programs, IT modernization efforts, and operational readiness initiatives. Spending in this category typically fluctuates based on the lifecycle of major programs, new strategic priorities, and budget allocations. Analyzing past five-year spending trends for similar NAICS codes (like 541330 - Engineering Services) within the Navy would provide context on the scale and consistency of such investments.
Are there any specific performance concerns or notable successes documented for KPMG LLP on this contract or similar DoD engagements?
The provided data does not include specific performance concerns or successes for KPMG LLP on this particular contract or similar Department of Defense engagements. A comprehensive assessment would require reviewing performance evaluations, contractor performance assessment reporting (CPAR) data, and any official communications regarding the contractor's adherence to the statement of work, quality of deliverables, and timeliness. Given that this is a delivery order under a larger contract vehicle, its performance is likely tracked, but such detailed records are typically internal to the agency or require specific data requests.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: N0002414R3079
Offers Received: 4
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Kpmg L.L.P.
Address: 1676 INTERNATIONAL DR STE 7000, MCLEAN, 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: $33,150,247
Exercised Options: $33,150,247
Current Obligation: $22,510,755
Subaward Activity
Number of Subawards: 18
Total Subaward Amount: $11,420,226
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0017814D8016
IDV Type: IDC
Timeline
Start Date: 2014-09-04
Current End Date: 2019-09-03
Potential End Date: 2019-09-03 00:00:00
Last Modified: 2022-05-25
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