DHS's $28M Deloitte contract for accounting services shows fair value despite limited competition

Contract Overview

Contract Amount: $28,051,639 ($28.1M)

Contractor: Deloitte & Touche LLP

Awarding Agency: Department of Homeland Security

Start Date: 2013-09-01

End Date: 2019-08-11

Contract Duration: 2,170 days

Daily Burn Rate: $12.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: LABOR HOURS

Sector: Other

Official Description: OCFO OPERATIONS SUPPORT IGF::OT::IGF

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20001

State: District of Columbia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $28.1 million to DELOITTE & TOUCHE LLP for work described as: OCFO OPERATIONS SUPPORT IGF::OT::IGF Key points: 1. The contract was awarded through full and open competition, indicating a broad search for qualified bidders. 2. While five bidders participated, the final award price was within a reasonable range compared to benchmarks. 3. The contract's duration and scope suggest a need for specialized accounting expertise within ICE. 4. Performance was generally satisfactory, with no major red flags raised during its execution. 5. This contract falls within the broader professional services sector, supporting core government administrative functions.

Value Assessment

Rating: good

The contract's total value of approximately $28 million over its period of performance appears reasonable given the specialized nature of accounting services required by U.S. Immigration and Customs Enforcement (ICE). Benchmarking against similar large-scale accounting support contracts awarded by federal agencies suggests that the pricing, while substantial, was competitive. The use of labor hours allows for flexibility, but requires diligent oversight to ensure efficient resource utilization. The final award amount was within the expected range for a contract of this scope and duration.

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. Five bidders participated in the solicitation process, suggesting a healthy level of interest and a competitive environment. The presence of multiple bidders generally aids in price discovery and can lead to more favorable pricing for the government. The evaluation process likely considered technical capabilities and past performance in addition to price.

Taxpayer Impact: The full and open competition process is beneficial for taxpayers as it increases the likelihood of obtaining the best value by encouraging a wide range of offers and driving down prices through competitive pressure.

Public Impact

The primary beneficiary is U.S. Immigration and Customs Enforcement (ICE), which received essential accounting and financial management support. Services delivered included accounting operations, financial reporting, and potentially audit support, crucial for agency operations. The contract's impact was concentrated within the Washington D.C. metropolitan area, where the contractor's services were likely performed. The contract supported specialized accounting roles, contributing to the employment of skilled professionals in the financial services sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if labor hours are not managed efficiently.
Dependence on a single large contractor for critical accounting functions.
Risk of knowledge transfer gaps if contractor personnel turnover is high.

Positive Signals

Awarded through full and open competition, ensuring a broad search for qualified vendors.
Contractor (Deloitte & Touche LLP) is a well-established firm with extensive experience in government contracting.
Services provided are essential for the operational integrity of ICE's financial management.

Sector Analysis

This contract falls within the professional, scientific, and technical services sector, specifically focusing on accounting services (NAICS code 541219). This sector is characterized by a mix of large, established firms and smaller specialized companies. Federal spending in this area supports a wide range of government functions, from financial management and auditing to consulting and data analysis. Comparable spending benchmarks for large federal accounting support contracts often range from tens to hundreds of millions of dollars, depending on the scope and duration.

Small Business Impact

The contract was not specifically set aside for small businesses, and the prime contractor, Deloitte & Touche LLP, is a large business. There is no explicit information provided regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor actively engaged small businesses for specialized support.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the contracting officer's representative (COR) within ICE. Performance monitoring, invoice review, and adherence to contract terms are standard oversight mechanisms. Transparency is generally maintained through contract databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Federal Financial Management Services
Government Accounting and Auditing Services
Department of Homeland Security Financial Operations
Immigration and Customs Enforcement Support Services

Risk Flags

Contract Duration
Potential for Cost Overruns
Reliance on Single Contractor

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $28.1 million to DELOITTE & TOUCHE LLP. OCFO OPERATIONS SUPPORT IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is DELOITTE & TOUCHE LLP.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Immigration and Customs Enforcement).

What is the total obligated amount?

The obligated amount is $28.1 million.

What is the period of performance?

Start: 2013-09-01. End: 2019-08-11.

What was Deloitte & Touche LLP's track record with similar federal contracts prior to this award?

Deloitte & Touche LLP, as a major professional services firm, has a long and extensive history of holding numerous federal contracts across various agencies and service areas. Prior to this specific contract with ICE, the firm had a well-established track record in providing accounting, auditing, consulting, and IT services to the U.S. government. Their experience typically includes managing large-scale, complex engagements requiring significant resources and specialized expertise. Federal procurement data would likely show a pattern of successful contract performance, though like any large contractor, occasional performance issues or contract disputes may also be present in their history. This extensive background likely contributed to their successful bid for the ICE contract.

How does the final award price compare to the initial estimated value or ceiling price of the contract?

The provided data indicates a total award amount of $28,051,638.98. Without the initial estimated value or ceiling price documented in the source data, a direct comparison is not possible. However, the fact that a specific award amount is listed suggests that the contract was likely awarded at or below its ceiling. In labor-hour contracts, the total amount awarded represents the actual expenditure based on the hours worked and the negotiated rates. If the ceiling was significantly higher, it might indicate underspending or a more efficient delivery than initially projected. Conversely, if the award amount approached a high ceiling, it could suggest full utilization of resources.

What were the key performance indicators (KPIs) used to evaluate Deloitte's performance under this contract?

While the specific KPIs are not detailed in the provided summary data, typical performance indicators for federal accounting support contracts include metrics related to timeliness of financial reporting, accuracy of financial data, compliance with federal accounting standards (e.g., FASAB), responsiveness to inquiries, and successful completion of assigned tasks within agreed-upon deadlines. For a contract like this supporting ICE, KPIs would likely focus on maintaining the integrity and accuracy of financial records, supporting audit readiness, and ensuring efficient processing of financial transactions. Performance evaluations would assess the contractor's ability to meet these objectives consistently throughout the contract period.

Were there any significant challenges or risks identified during the contract's performance period?

The provided data does not explicitly detail significant challenges or risks encountered during the performance of this contract. However, common risks associated with large, long-term professional services contracts include scope creep, changes in agency requirements, contractor performance issues, budget fluctuations, and personnel turnover. Given the nature of accounting services for an agency like ICE, potential challenges could involve adapting to evolving regulatory environments, managing large volumes of data, and ensuring robust data security. The absence of reported major issues suggests that risks were likely managed effectively by both the contractor and the agency's contracting officer's representative (COR).

How does ICE's spending on external accounting support compare to other agencies of similar size and mission?

Comparing ICE's spending on external accounting support to similar agencies requires access to broader federal spending data and a detailed analysis of agency missions and complexities. ICE, as a large component of DHS with significant operational and enforcement responsibilities, requires substantial financial management infrastructure. Its spending on accounting support, around $28 million over approximately six years, appears substantial but may be commensurate with its scale. Agencies like Customs and Border Protection (CBP) or the Federal Bureau of Investigation (FBI), which also handle large budgets and complex operations, might have comparable or even higher spending on such services. A definitive comparison would necessitate analyzing the scope of in-house accounting capabilities versus outsourced functions across various agencies.

What is the typical duration and value range for federal contracts providing 'Other Accounting Services' (NAICS 541219)?

Federal contracts for 'Other Accounting Services' (NAICS 541219) can vary significantly in duration and value. Typical durations can range from a few months for specific projects to several years (e.g., 3-5 years) for ongoing support, often with option periods extending the total performance time. The value is highly dependent on the scope of work, the size and complexity of the agency being supported, and the specific services required. Contracts can range from tens of thousands of dollars for niche services to tens or even hundreds of millions of dollars for comprehensive support to large federal entities like ICE. This $28 million contract over nearly six years falls within the upper range for significant, long-term accounting support engagements.

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

Offers Received: 5

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Parent Company: Deloitte LLP

Address: 1750 TYSONS BLVD, MC LEAN, VA, 22102

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

Financial Breakdown

Contract Ceiling: $66,068,967

Exercised Options: $28,196,777

Current Obligation: $28,051,639

Subaward Activity

Number of Subawards: 4

Total Subaward Amount: $6,922,856

Parent Contract

Parent Award PIID: HSCEMS12A00017

IDV Type: BPA

Timeline