Audit Report
01-18-2013 |
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What We Did What We Did We reviewed the financial records of 24 DoD contractors that were the recipients of 50 earmarks, valued at $115.5 million, to determine whether DoD contractors that lobbied for and were the recipients of earmarks complied with the requirements of the United States Code and the Federal Acquisition Regulation and properly classified lobbying costs as unallowable expenses. We also determined whether earmark recipients submitted Office of Management and Budget Standard Form LLL, “Disclosure of Lobbying Activities,” (Standard Form LLL) to contracting officers. What We Found Eighteen contractors properly accounted for $5.2 million in lobbying costs. Six other contractors properly accounted for $1.8 million in lobbying costs. However, the six contractors improperly classified a total of $85,610 in lobbying costs as allowable and classified a total of $12,695 in unsupported costs as allowable. Specifically:
As a result, DoD may have reimbursed six contractors for unallowable lobbying costs. During the audit, the five contractors that improperly classified lobbying costs as allowable agreed to reclassify $85,347 of the improperly classified lobbying costs. One of these contractors could not match the remaining $263 to its accounts. Ten contractors did not submit Standard Forms LLL because generally the contractors either stated that they were unaware of the requirement or we concluded that they misunderstood the requirement. What We Recommend The Director, Defense Procurement and Acquisition Policy, issue guidance to reinforce the Federal Acquisition Regulation requirements for disclosure of lobbying activities and explain how and where to report Lobbying Disclosure Act violations. Management Comments and Our Response The Director, Defense Procurement and Acquisition Policy, agreed with the recommendations, and his comments were responsive. |