DoD's $100M contract with Deloitte for accounting services shows strong competition and fair pricing

Contract Overview

Contract Amount: $100,210,875 ($100.2M)

Contractor: Deloitte & Touche LLP

Awarding Agency: Department of Defense

Start Date: 2022-05-06

End Date: 2025-04-22

Contract Duration: 1,082 days

Daily Burn Rate: $92.6K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PKS - ROSS - CARMONA PAREDES - FIAR TO 0044

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20330

State: District of Columbia Government Spending

Plain-Language Summary

Department of Defense obligated $100.2 million to DELOITTE & TOUCHE LLP for work described as: PKS - ROSS - CARMONA PAREDES - FIAR TO 0044 Key points: 1. The contract was awarded through full and open competition, indicating a robust market for these services. 2. Deloitte & Touche LLP, a major player, secured the award, suggesting strong capabilities and competitive bidding. 3. The fixed-price contract type helps mitigate cost overrun risks for the government. 4. The duration of the contract (over 3 years) suggests a significant and ongoing need for these accounting services. 5. The contract is positioned within the professional services sector, specifically accounting and auditing. 6. The award value is substantial, reflecting the complexity and scope of the services required by the Air Force.

Value Assessment

Rating: good

The contract's fixed-price nature is a positive indicator for value, as it shifts cost risk to the contractor. Benchmarking against similar large-scale accounting and auditing contracts awarded by the Department of Defense suggests that the pricing is competitive, especially given the contractor's established reputation and the scope of services. The absence of significant modifications or overruns in the initial award phase further supports a fair assessment of value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, meaning all responsible sources were permitted to submit a bid. The specific number of bidders is not provided, but the designation implies a competitive process that likely resulted in a fair market price. The extensive competition in this segment of professional services generally leads to better price discovery and selection of highly qualified contractors.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best value for public funds by encouraging multiple firms to offer their most competitive pricing and service offerings.

Public Impact

The Department of the Air Force benefits from enhanced financial management and auditing capabilities. Services provided include essential accounting and auditing functions critical for government financial accountability. The contract's impact is primarily within the federal government's financial operations, with a geographic focus on Washington D.C. This contract supports highly skilled professional jobs in the accounting and auditing sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for contractor lock-in due to the long-term nature and specialized services.
Reliance on a single large contractor could limit future competition if not managed carefully.
Scope creep could become an issue if not rigorously managed through contract modifications.

Positive Signals

Awarded through full and open competition, ensuring a broad range of potential bidders.
Fixed-price contract type helps control costs and provides budget certainty.
Contractor is a well-established firm with a strong track record in government contracting.
The contract duration aligns with the sustained need for these critical financial services.

Sector Analysis

The federal government is a significant consumer of professional services, including accounting, auditing, and financial consulting. This contract falls within the broader professional, scientific, and technical services sector, which is a substantial portion of federal spending. The market for these services is characterized by a mix of large, established firms like Deloitte and smaller specialized companies. Government contracts often represent a stable revenue stream for these firms, and competition can be intense, particularly for large-scale awards.

Small Business Impact

The data indicates that this contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements for small businesses mentioned in the provided data. This suggests that the primary focus was on securing the best overall offer from the market, which often favors larger, established firms for complex professional services. The impact on the small business ecosystem is likely minimal for this specific award, though large prime contractors are often encouraged to utilize small business subcontractors on other contracts.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Air Force's contracting and financial management offices. Accountability measures are inherent in the fixed-price contract structure, requiring the contractor to deliver specified services within the agreed-upon budget. Transparency is generally maintained through contract award databases and reporting requirements. The Inspector General's office for the Department of Defense would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Federal Financial Management Services
Government Auditing Services
Professional Services Contracts
Department of Defense Financial Operations
Air Force Contracting

Risk Flags

Potential for scope creep due to contract duration.
Reliance on a single large contractor.
Ensuring data security and confidentiality.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $100.2 million to DELOITTE & TOUCHE LLP. PKS - ROSS - CARMONA PAREDES - FIAR TO 0044

Who is the contractor on this award?

The obligated recipient is DELOITTE & TOUCHE LLP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $100.2 million.

What is the period of performance?

Start: 2022-05-06. End: 2025-04-22.

What is Deloitte & Touche LLP's track record with federal contracts, particularly within the Department of Defense?

Deloitte & Touche LLP has a significant and extensive history of securing federal contracts across various agencies, including the Department of Defense (DoD). They are a major player in providing professional services, encompassing auditing, financial consulting, and management advisory services. Their track record with the DoD includes numerous awards for complex financial management, IT modernization, and strategic planning initiatives. While specific performance metrics for past contracts are not detailed here, their continued success in winning large, competitive bids suggests a generally positive performance history and a strong understanding of government requirements and compliance. Their ability to secure contracts like this one, valued at over $100 million, underscores their established presence and capability within the federal contracting landscape.

How does the value of this contract compare to similar accounting and auditing services procured by the federal government?

This contract, valued at approximately $100 million, is substantial and falls within the upper range for professional services contracts, particularly those involving comprehensive accounting and auditing functions for a major agency like the Department of the Air Force. Comparable contracts for similar services often range from tens of millions to over a hundred million dollars, depending on the scope, duration, and specific requirements. Large-scale financial management and auditing contracts awarded to major consulting firms by agencies such as the Department of the Treasury, Health and Human Services, or other branches of the DoD can be of similar magnitude. The fixed-price nature of this award, coupled with its full and open competition, suggests that the pricing is likely competitive within this benchmark range.

What are the primary risks associated with a contract of this size and duration for accounting services?

Key risks for a contract of this magnitude and duration include potential scope creep, where the requirements may expand beyond the initial agreement, leading to cost increases or delays if not managed properly. Contractor performance is another significant risk; a large firm may spread its resources too thin, or key personnel might depart, impacting service quality. Over-reliance on a single contractor could also pose a risk, potentially leading to reduced competition or leverage in future procurements. Furthermore, changes in government regulations or agency priorities could necessitate contract modifications, introducing complexity and potential cost adjustments. Finally, ensuring data security and confidentiality for sensitive financial information handled by the contractor is paramount.

How effective is the fixed-price contract type in ensuring value for money in this context?

The fixed-price contract type is generally effective in ensuring value for money for well-defined services like accounting and auditing, as it shifts the risk of cost overruns to the contractor. This incentivizes the contractor to manage their resources efficiently and control costs to maximize profit. For the government, it provides budget certainty, as the price is set upfront. However, the effectiveness hinges on the accuracy of the initial scope definition; if the scope is poorly defined or changes significantly, a fixed-price contract can become problematic, potentially leading to disputes or the need for costly change orders. In this case, for standard accounting and auditing services, it is a suitable mechanism for controlling costs and ensuring predictable spending.

What are the historical spending patterns for accounting and auditing services within the Department of the Air Force?

The Department of the Air Force, like other branches of the DoD, consistently spends significant amounts on accounting and auditing services. This spending is driven by the need for financial accountability, compliance with federal regulations, and efficient management of vast budgets. Historical data indicates a recurring need for both internal auditing functions and external support from certified public accounting firms for financial statement audits and advisory services. Spending in this category often fluctuates based on specific audit cycles, system modernization efforts, and evolving regulatory requirements. Contracts awarded to large firms like Deloitte are typical for fulfilling these large-scale, long-term needs, reflecting a consistent pattern of outsourcing specialized financial functions.

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: TWO STEP

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte Financial Advisory Services LLP

Address: 1919 N LYNN ST, ARLINGTON, VA, 22209

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $100,210,875

Exercised Options: $100,210,875

Current Obligation: $100,210,875

Actual Outlays: $37,735,211

Subaward Activity

Number of Subawards: 9

Total Subaward Amount: $5,865,396

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA701418D5000

IDV Type: IDC

Timeline