Accenture LLP contract for tax preparer identification services valued at $37.3M, awarded under full and open competition

Contract Overview

Contract Amount: $37,322,698 ($37.3M)

Contractor: Accenture LLP

Awarding Agency: Department of the Treasury

Start Date: 2016-08-01

End Date: 2020-07-31

Contract Duration: 1,460 days

Daily Burn Rate: $25.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::CT::IGF FOR PREPARER TAX IDENTIFICATION NUMBER (PTIN) AND ENTER THE PTIN ON ALL RETURNS THEY PREPARE.

Place of Performance

Location: LANHAM, PRINCE GEORGES County, MARYLAND, 20706

State: Maryland Government Spending

Plain-Language Summary

Department of the Treasury obligated $37.3 million to ACCENTURE LLP for work described as: IGF::CT::IGF FOR PREPARER TAX IDENTIFICATION NUMBER (PTIN) AND ENTER THE PTIN ON ALL RETURNS THEY PREPARE. Key points: 1. The contract's value of $37.3 million over four years suggests a significant investment in tax preparer identification systems. 2. Awarded under full and open competition, this indicates a potentially competitive bidding process that could drive favorable pricing. 3. The fixed-price contract type generally shifts performance risk to the contractor, Accenture LLP. 4. The NAICS code 541519 (Other Computer Related Services) places this contract within the broader IT services sector. 5. The contract duration of 1460 days (4 years) provides a stable period for service delivery and system development. 6. The absence of small business set-aside flags suggests the primary award was not specifically targeted to small businesses.

Value Assessment

Rating: good

The contract value of $37.3 million over four years averages to approximately $9.3 million annually. Without specific benchmarks for 'Preparer Tax Identification Number (PTIN)' services, a direct comparison is difficult. However, the fixed-price nature of the contract suggests that the government has negotiated a set cost for the defined scope of work, which is generally a positive indicator for value if the scope is well-defined and met. The competition level also supports the likelihood of a fair price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' meaning all responsible sources were permitted to submit a bid. The presence of two bidders (no: 2) indicates some level of competition, though a higher number of bidders would typically suggest more robust price discovery. The fact that it was competed at all is a positive sign for price negotiation.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down costs through market forces. This contract's competitive nature suggests the IRS likely secured a reasonable price for the services.

Public Impact

Tax preparers benefit from a clear and established system for obtaining and managing their Preparer Tax Identification Numbers (PTINs). The Internal Revenue Service (IRS) benefits from an efficient and compliant system for tracking tax preparers, enhancing tax administration. The services delivered likely include IT infrastructure, software development, maintenance, and support related to the PTIN system. The geographic impact is national, as all tax preparers operating within the United States are subject to PTIN requirements. The workforce implications include employment opportunities for IT professionals and support staff within Accenture LLP and potentially its subcontractors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for scope creep if the requirements for the PTIN system evolve significantly during the contract period.
Dependence on a single contractor, Accenture LLP, for a critical IRS function could pose a risk if performance issues arise.
The number of bidders (2) might indicate potential barriers to entry for other firms or a lack of widespread interest in this specific service area.

Positive Signals

Awarded through full and open competition, suggesting a fair and transparent procurement process.
The firm fixed-price contract type aligns incentives and transfers risk to the contractor.
The contract duration of four years provides stability for system development and operation.
Accenture LLP is a large, established IT services provider with a track record in government contracting.

Sector Analysis

This contract falls within the IT services sector, specifically focusing on custom computer programming services and other computer-related services (NAICS 541519). The market for government IT services is substantial, with agencies continually seeking to modernize systems and improve efficiency. Comparable spending benchmarks would involve looking at other large-scale IT development and maintenance contracts awarded by agencies like the IRS or other Treasury bureaus for similar system functionalities.

Small Business Impact

The contract data indicates that this was not a small business set-aside (ss: false, sb: false). Therefore, the primary award was not specifically targeted to small businesses. However, as a large IT services contract, there is potential for subcontracting opportunities for small businesses, depending on Accenture LLP's subcontracting plan and the specific technical requirements of the PTIN system. The overall impact on the small business ecosystem would depend on the extent to which small businesses are engaged as subcontractors.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officers and program managers within the Internal Revenue Service (IRS). The contract's fixed-price nature incentivizes contractor performance, but regular monitoring of deliverables, milestones, and service levels is crucial. Transparency is generally maintained through contract award databases and public reporting, though specific performance details may be proprietary. The IRS may also have an Inspector General's office that could conduct audits or investigations into the contract's execution if concerns arise.

Related Government Programs

IRS Taxpayer Data Management Systems
Federal IT Modernization Programs
Government Contractor Performance Monitoring
Tax Preparer Registration and Compliance Systems
Financial Management Systems (Treasury)

Risk Flags

Potential for cybersecurity vulnerabilities
Risk of system obsolescence
Dependence on contractor performance
Challenges in ensuring tax preparer compliance

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $37.3 million to ACCENTURE LLP. IGF::CT::IGF FOR PREPARER TAX IDENTIFICATION NUMBER (PTIN) AND ENTER THE PTIN ON ALL RETURNS THEY PREPARE.

Who is the contractor on this award?

The obligated recipient is ACCENTURE LLP.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $37.3 million.

What is the period of performance?

Start: 2016-08-01. End: 2020-07-31.

What is the track record of Accenture LLP in delivering similar IT services to the federal government, particularly for tax administration agencies?

Accenture LLP is a major global IT services and consulting firm with extensive experience working with federal agencies, including the Department of the Treasury and the IRS. They have a history of managing large-scale IT projects, system modernization, and data management solutions. While specific details on past performance for PTIN-related systems are not provided in this data snippet, Accenture's broad experience suggests a capacity to handle complex government IT contracts. A deeper dive into their past performance evaluations (e.g., through the Federal Procurement Data System - Next Generation or agency-specific performance records) would be necessary to fully assess their track record for this specific type of service.

How does the average annual cost of this contract ($9.3 million) compare to similar IT service contracts for tax administration or identification systems within the federal government?

Directly comparing the average annual cost of $9.3 million for this PTIN system contract requires access to a benchmark database of similar federal IT procurements. Factors such as the complexity of the system, the number of users, the required security protocols, and the specific services (development, maintenance, support) heavily influence costs. Generally, large-scale IT systems for agencies like the IRS, which handle sensitive data and high transaction volumes, can range from several million to tens of millions of dollars annually. Without specific comparable contract data, it's challenging to definitively state if $9.3 million is high or low, but it falls within a plausible range for a significant federal IT system.

What are the key performance indicators (KPIs) or service level agreements (SLAs) associated with this contract, and how is Accenture's performance measured?

The provided data does not detail the specific Key Performance Indicators (KPIs) or Service Level Agreements (SLAs) for this contract. However, for an IT service contract of this nature, typical KPIs and SLAs would likely include system uptime/availability, response times for technical support, data accuracy and integrity, security compliance, and timely completion of development milestones or maintenance tasks. Performance measurement would be conducted by the IRS contracting officer's representative (COR) through regular reviews of contractor reports, system performance monitoring tools, and potentially user feedback. Adherence to these metrics would determine Accenture's overall performance rating.

What is the historical spending pattern for PTIN-related services by the IRS, and does this $37.3 million contract represent an increase or decrease in investment?

The provided data only includes details for this specific contract (2016-2020). To understand historical spending patterns, one would need to analyze IRS procurement data for PTIN-related services over several preceding years. This would involve searching for previous contracts related to PTIN management, tax preparer identification, or similar functions. Without that historical context, it's impossible to determine if the $37.3 million award represents an increase, decrease, or consistent level of investment in these services. It could reflect a new system development, a consolidation of previous services, or a standard contract renewal.

Are there any known risks or challenges associated with the PTIN system itself, or with the technology being used, that could impact contract performance?

The data does not specify any inherent risks or challenges with the PTIN system or its underlying technology. However, general risks for such systems can include cybersecurity threats targeting sensitive taxpayer data, potential for system obsolescence requiring frequent updates, challenges in user adoption or compliance by tax preparers, and integration issues with other IRS systems. The effectiveness of the chosen technology and Accenture's ability to manage these potential risks would be critical to successful contract performance. A thorough risk assessment by the IRS prior to and during the contract would be standard practice.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Accenture Public Limited Company (UEI: 985015354)

Address: 11951 FREEDOM DR STE 1000, RESTON, VA, 20190

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

Financial Breakdown

Contract Ceiling: $80,631,396

Exercised Options: $80,631,396

Current Obligation: $37,322,698

Actual Outlays: $12,767,347

Subaward Activity

Number of Subawards: 142

Total Subaward Amount: $27,690,255

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: TIRNO11D00007

IDV Type: IDC

Timeline