GSA's $19.6M Accounting Services Contract with Kearney & Company Faces Scrutiny Over Value and Competition

Contract Overview

Contract Amount: $19,591,294 ($19.6M)

Contractor: Kearney & Company, P.C.

Awarding Agency: General Services Administration

Start Date: 2012-06-22

End Date: 2015-06-21

Contract Duration: 1,094 days

Daily Burn Rate: $17.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: SAF FMEW WORKFORCE DEVELOPMENT AND EXECUTIVE SERVICES SUPPORT

Place of Performance

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

State: District of Columbia Government Spending

Plain-Language Summary

General Services Administration obligated $19.6 million to KEARNEY & COMPANY, P.C. for work described as: SAF FMEW WORKFORCE DEVELOPMENT AND EXECUTIVE SERVICES SUPPORT Key points: 1. The contract awarded to Kearney & Company for accounting services represents a significant investment, raising questions about its overall value. 2. While awarded under full and open competition, the specific impact on price discovery for this Time and Materials contract needs further examination. 3. The absence of small business participation is noted, potentially limiting broader economic impact. 4. The sector is Other Accounting Services, a critical but often overlooked area of federal spending.

Value Assessment

Rating: questionable

The contract's Time and Materials pricing structure, coupled with a substantial value of nearly $20 million, warrants a closer look at cost efficiency. Benchmarking against similar accounting support contracts is crucial to determine if the pricing is competitive and reflects fair market value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, which is a positive indicator for price discovery. However, the Time and Materials (T&M) pricing model can sometimes lead to cost overruns if not meticulously managed and monitored.

Taxpayer Impact: Taxpayers are impacted by the total contract value of $19.6 million. Ensuring efficient service delivery and competitive pricing is essential to maximize the value of this federal expenditure.

Public Impact

Significant federal funds allocated to accounting services, impacting budget transparency and financial management. Potential for improved financial reporting and audit readiness across federal agencies. Lack of small business involvement may limit opportunities for emerging firms in the accounting sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of small business participation
Time and Materials pricing model
High contract value without clear performance metrics

Positive Signals

Awarded under full and open competition
Supports critical accounting functions

Sector Analysis

This contract falls within the Other Accounting Services sector, which is vital for federal financial management and compliance. Benchmarks for similar contracts are difficult to establish without more granular data on service scope and complexity, but the $19.6 million value is substantial for this category.

Small Business Impact

The contract explicitly states no small business participation (ss: false, sb: false). This indicates that opportunities for small businesses in providing these specialized accounting services were not pursued or met under this specific award, potentially missing out on economic development benefits.

Oversight & Accountability

Oversight of this contract by the General Services Administration (GSA) is critical, especially given the Time and Materials pricing. Robust monitoring of hours, rates, and deliverables is necessary to ensure accountability and prevent cost creep.

Related Government Programs

Other Accounting Services
General Services Administration Contracting
Federal Acquisition Service Programs

Risk Flags

High contract value
Time and Materials pricing model
No small business participation
Lack of detailed service scope justification

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $19.6 million to KEARNEY & COMPANY, P.C.. SAF FMEW WORKFORCE DEVELOPMENT AND EXECUTIVE SERVICES SUPPORT

Who is the contractor on this award?

The obligated recipient is KEARNEY & COMPANY, P.C..

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $19.6 million.

What is the period of performance?

Start: 2012-06-22. End: 2015-06-21.

What specific accounting services were provided under this contract, and how did their scope justify the $19.6 million expenditure?

The contract covered 'WORKFORCE DEVELOPMENT AND EXECUTIVE SERVICES SUPPORT' within accounting. While the exact breakdown of services isn't detailed, such support typically includes financial analysis, audit preparation, policy development, and executive-level advisory. The substantial cost suggests a broad scope or long-term engagement, but a clearer definition of deliverables and their impact on agency efficiency would better justify the expenditure.

Given the Time and Materials pricing, what mechanisms were in place to control costs and ensure the government received fair value?

Time and Materials contracts inherently carry a risk of cost escalation. Effective oversight would involve rigorous tracking of labor hours, verification of hourly rates against market standards, and strict limitations on indirect cost markups. Without detailed reporting on these controls, it's difficult to assess the effectiveness of price discovery and cost containment for this nearly $20 million contract.

How did the full and open competition process ensure competitive pricing for these specialized accounting services?

Full and open competition theoretically allows any qualified vendor to bid, fostering a competitive environment that should drive down prices. However, the effectiveness depends on the clarity of the solicitation, the number and capability of bidders, and the specific evaluation criteria. For specialized services like these, ensuring that the bidding pool truly represented the market and that the evaluation favored the best value, not just the lowest price, is key to realizing the benefits of competition.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Accounting, Tax Preparation, Bookkeeping, and Payroll Services › Other Accounting Services

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

Solicitation ID: ID07120040

Offers Received: 1

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Address: 1701 DUKE ST STE 500, ALEXANDRIA, VA, 22314

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $51,139,206

Exercised Options: $23,363,615

Current Obligation: $19,591,294

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $1,380,059

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS23F0092J

IDV Type: FSS

Timeline