Report Summary

Title: Audit of NCA's Contracting Practices
Report Number: 12-00366-339
Issue Date: 9/26/2013
City/State:
VA Office: National Cemetery Administration (NCA)
Report Author: Office of Audits and Evaluations
Report Type: Audits, Reviews & Evaluations
Release Type: Unrestricted
Summary: The National Cemetery Administration (NCA) transferred contract responsibilities from the Veterans Health Administration (VHA) to NCA’s Office of Management Contracting Service, in February 2008, to improve its acquisition process. NCA administered 574 contracts during calendar year 2012 with an estimated contract value of about $382 million. OIG conducted this audit to access the adequacy of contract development, award, administration, and oversight processes of the NCA Office of Management Contracting Services. We found that NCA did not have effective internal controls, or existing controls were not followed, to ensure adequate development, award, and administration of contracts. In a statistical sample of 50 competitive contracts and all 32 noncompetitive contracts, we found one or more contract deficiencies in each of the 82 contracts we reviewed. Contract files did not always have sufficient evidence of acquisition planning, market research, and vendor past performance. NCA improperly awarded 16 of the 32 noncompetitive contracts, as opposed to competitively bid small business set-asides. Contracting officers did not consistently provide a complete history of contract actions in VA’s mandatory Electronic Contract Management System (eCMS). Additionally, NCA did not conduct Integrated Oversight Process (IOP) reviews of 25 of the 36 competitive contracts and 24 of the 29 noncompetitive contracts that were required to be reviewed under this mandatory process.
These deficiencies occurred because NCA did not have sufficient management staff in place to lead and manage the newly established organization. Without sufficient management oversight, NCA could not ensure internal controls were working properly, and as planned, when developing and awarding contracts. As a result, NCA cannot ensure awarded contracts consistently met the Federal Acquisition Regulation and VA policies. We recommended NCA strengthen contracting processes and controls by enforcing the proper use of competition requirements, make full use of eCMS, and fully implement IOP reviews. The Under Secretary for Memorial Affairs agreed with our recommendations and provided an appropriate action plan.