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GSA IG Audit Memorandum Number A120050-4

IG Audits complianceWe have noticed that there are an increased number of Inspector General (IG) audits being conducted by the GSA. More audits are occurring, because there is a strong push by the GSA to make sure that contractors are remaining compliant to the standards set by the government.

Saving money is the main standard of the government and this recent audit memorandum has affirmed this stance. Three issues occurred, which were prioritized by the GSA  due to recent data by  IG Audits which are further highlighted in this memorandum. The  first issue  was that the Federal Acquisition Service (FAS) should focus on ensuring that  GSA contractors are properly administering the price reduction and billing provisions of their contracts. This is evident by the fact that nearly half of the contractors audited in FY2012 did not have sufficient sales monitoring and billing systems.

The second focus was the continued prevalence of Commercial Sales Practices (CSP) issues, and the last focusing point was achieving a greater portion of recommended cost savings. The GSA evaluated 25 contractors, who submitted CSPs and out of these 25, they found that 21 (84%) of those contractors had inaccurate and incomplete information. Achieving greater cost savings was found in GSA’s reopening of negotiations, which enabled auditors to find flawed negotiation techniques and allowed the GSA to gain $49.6 million in additional savings.

These three focuses by the GSA are prevalent, due to the overall drive to be more cost effective with their GSA Schedule contracts. The increased number of IG audits and this memorandum reaffirm that as a Multiple Award Schedule (MAS) contractor it is essential that you are complaint; you remain current, and lastly that you are accurate and complete with your CSPs.

Aren’t sure if you are compliant? Learn how to conduct self-audits to protect your company from fines and penalties!

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