Reliability of Federal Procurement Data
Gao ID: GAO-04-295R December 30, 2003
Reliable information is critical to informed decision making and to oversight of the procurement system. The Federal Procurement Data System (FPDS) has been the federal government's central database of information on federal procurement actions since 1978. Congress and executive branch agencies rely on FPDS to assess the impact that governmentwide acquisition policies and processes are having on the system generally, as well as with respect to specific geographical areas, markets, and socio-economic goals. Yet despite the importance of the data, we continue to find that FPDS data are inaccurate and incomplete. Although we have not fully assessed the extent of reporting errors, we have found sufficient problems to warrant concern about the current reliability of FPDS information.
As a result of numerous errors in data elements of FPDS, we could not determine the extent to which agencies had implemented regulations effectively, nor could we assess the impact of acquisition policies governmentwide. Our concerns about the reliability of FPDS data are not new. In 1980, we reported that FPDS failed to alert users that the system contained known errors. In 1994, we reported that the Federal Procurement Data Center (FPDC), which manages FPDS, did not have standards detailing the appropriate levels of accuracy and completeness of FPDS data. Our work and that of agency inspectors general indicates that many of the errors in FPDS are due to data entry mistakes by agency contracting personnel. In some cases, those processing the data did not have a complete understanding of the information requirements. In other cases, there was inadequate verification of the information entered into agency feeder systems, which, in turn, was transferred into FPDS. Agency officials cited a lack of training, high personnel turnover, the complexity of the agency systems, and frequent changes to FPDS data entry requirements as reasons for the errors. FPDSNext Generation (FPDS-NG) became operational effective October 1, 2003. As we understand the design of the system, FPDS-NG should, if implemented effectively, eliminate many of the sources of the errors in the current FPDS. At the heart of the new system are data entry methods that rely less on manual inputs and more on electronic "machine-to-machine" approaches. The system provides for immediate data verification to detect errors. If errors are detected, agency procurement officials will have the opportunity to correct them immediately while the information is still readily available. Information in FPDS-NG can only be as reliable as the information agencies enter through their own systems. In the long term, data reliability should improve as agencies fund and implement electronic contract writing systems. But not all agencies have done so. In the short term, as the transition to FPDS-NG occurs, agencies that do not have contract writing systems capable of interfacing directly with FPDS-NG need to review their procurement data feeder systems and take steps to improve the reliability of the information contained in those systems.
Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director:
William T. Woods
Team:
Government Accountability Office: Acquisition and Sourcing Management
Phone:
(202) 512-8214
GAO-04-295R, Reliability of Federal Procurement Data
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December 30, 2003:
The Honorable Joshua B. Bolten:
Director, Office of Management and Budget:
Subject: Reliability of Federal Procurement Data:
Dear Mr. Bolten:
The purpose of this letter is to convey our serious and continuing
concerns with the reliability of the data contained in the Federal
Procurement Data System (FPDS) and to recommend steps to help improve
data reliability as the successor system, FPDS-Next Generation (FPDS-
NG), is implemented.
Reliable information is critical to informed decision making and to
oversight of the procurement system. FPDS has been the federal
government's central database of information on federal procurement
actions since 1978. Congress and executive branch agencies rely on FPDS
to assess the impact that governmentwide acquisition policies and
processes are having on the system generally, as well as with respect
to specific geographical areas, markets, and socio-economic goals.
Yet despite the importance of the data, we continue to find that FPDS
data are inaccurate and incomplete. Although we have not fully assessed
the extent of reporting errors, we have found sufficient problems to
warrant concern about the current reliability of FPDS information. We
are pleased that the administration is moving forward with plans to
modernize that system through FPDS-NG.
The examples following reflect a few of the many instances in which we
either have been unable to assess fully the implementation of
procurement programs or have had to limit our reliance on FPDS data:
In our 2003 review[Footnote 1] of the simplified acquisition procedures
test program, we found gross errors in the FPDS data. For example, use
of the test program by the reported three largest users in fiscal year
2001 was either overstated or understated by millions of dollars. We
found similar inaccuracies with the Department of Defense's data
system,[Footnote 2] which feeds information into FPDS. Because of the
unreliability of the data, we could not determine the extent to which
executive branch agencies used the test program or assess the benefits
realized.
In our 2001 review[Footnote 3] of the HUBZone program, we found that
the value of contracts awarded to HUBZone firms could have been
hundreds of millions of dollars different than reported. The FPDS
categorized 1,034 contracts worth $325 million as HUBZone awards even
though the Small Business Administration (SBA) had not certified the
awardees of those contracts as HUBZone firms. Conversely, FPDS data did
not report as HUBZone awards 1,712 contracts worth $589 million with
firms that may have been SBA-certified at time of contract award.
Although the Federal Procurement Data Center (FPDC) caught some of
these inconsistencies through edit checks, FPDC officials said that
they had neither the knowledge to correct the data nor the authority to
require agencies to correct them.
* In our 2003 review of task and delivery orders,[Footnote 4] we found
multiple orders reported as single transactions. For instance, an order
reported as $11,443,000 in FPDS should have been reported as 87
separate transactions at or over $25,000 and one cumulative transaction
for contracts below $25,000.
As a result of numerous errors in these and other data elements of
FPDS, we could not determine the extent to which agencies had
implemented regulations effectively, nor could we assess the impact of
acquisition policies governmentwide.
Our concerns about the reliability of FPDS data are not new. In 1980,
we reported that FPDS failed to alert users that the system contained
known errors. In 1994, we reported that the FPDC, which manages FPDS,
did not have standards detailing the appropriate levels of accuracy and
completeness of FPDS data.[Footnote 5]
Our work and that of agency inspectors general indicates that many of
the errors in FPDS are due to data entry mistakes by agency contracting
personnel. In some cases, those processing the data did not have a
complete understanding of the information requirements. In other cases,
there was inadequate verification of the information entered into
agency feeder systems, which, in turn, was transferred into FPDS. When
we discussed these problems with agency officials during the course of
our reviews, they cited a lack of training, high personnel turnover,
the complexity of the agency systems, and frequent changes to FPDS data
entry requirements as reasons for the errors.
FPDS-NG became operational effective October 1, 2003. As we understand
the design of the system, FPDS-NG should, if implemented effectively,
eliminate many of the sources of the errors in the current FPDS. At the
heart of the new system are data entry methods that rely less on manual
inputs and more on electronic "machine-to-machine" approaches. For
example, most agencies are expected to have computerized contract
writing systems that will allow for direct submission of data to FPDS.
Reliability of data is expected to improve because agency submissions
to FPDS-NG will be based on data already in the contract writing
systems, reducing or eliminating separate data entry requirements. The
system provides for immediate data verification to detect errors. If
errors are detected, agency procurement officials will have the
opportunity to correct them immediately while the information is still
readily available.
Information in FPDS-NG can only be as reliable as the information
agencies enter through their own systems. In the long term, data
reliability should improve as agencies fund and implement electronic
contract writing systems. But not all agencies have done so. In the
short term, as the transition to FPDS-NG occurs, agencies that do not
have contract writing systems capable of interfacing directly with
FPDS-NG need to review their procurement data feeder systems and take
steps to improve the reliability of the information contained in those
systems.
RECOMMENDATIONS:
We recommend that the Director of OMB:
* Ensure that agencies allocate the resources necessary to implement
contract writing systems capable of electronic transfer of information
to FPDS-NG,
* Require agencies that have not yet implemented electronic contract
writing systems to report regularly to OMB on their plans to ensure
reliability of the information reported to FPDS-NG.
* Request that major agencies, in consultation with GSA, conduct
regular reviews of their procedures for collecting and reporting
information to FPDS-NG. Agencies should conduct such reviews annually
until a satisfactory level of reliability is achieved, and periodically
thereafter.
AGENCY COMMENTS:
We provided a draft of this letter to the Office of Management and
Budget for comment. An OMB official commented orally that OMB generally
agreed with the recommendations. We also sought comments from the
General Services Administration, which funds and manages the Federal
Procurement Data Center. An official from GSA told us by email that GSA
concurred with the recommendations and hoped they would lead to more
accurate reporting of procurement information to FPDS-NG.
SCOPE AND METHODOLOGY:
The information in this letter is based on previous GAO reviews and
additional work conducted from June to November 2003, in accordance
with generally accepted government auditing standards. In conducting
that work, we reviewed relevant GAO workpapers and GAO and inspector
general reports. We also held discussions with officials at OMB and GSA
and reviewed relevant documents concerning FPDS and FPDS-Next
Generation. We did not conduct an in-depth review of either FPDS or
FPDS-NG.
This letter contains a recommendation to the Director of OMB. The head
of a federal agency is required under 31 U.S.C. 720 to submit a written
statement of actions taken on our recommendations to the Senate
Committee on Governmental Affairs and the House Committee on Government
Reform not later than 60 days after the date of this letter and to the
Senate and House Committees on Appropriations with the agency's first
request for appropriations made more than 60 days after the date of
this letter.
We are sending copies of this letter to the Chairs and Ranking Members
of the Senate Governmental Affairs Committee, the House Government
Reform Committee, and other interested congressional committees, as
well as to the Administrator of General Services. We will provide
copies to others upon request. This letter also will be available on
GAO's home page at http://www.gao.gov. Please contact me at (202) 512-
8214 or Hilary Sullivan at (214) 777-5652 if you or your staff has
questions. Major contributors to this letter were Robert Ackley, Thomas
Barger, William Bricking, John Clary, Barbara Johnson, Ronald Salo, and
Robert Swierczek.
Sincerely yours,
William T. Woods:
Director:
Acquisition and Sourcing Management:
(120261):
FOOTNOTES
[1] U.S. General Accounting Office, Contract Management: No Reliable
Data to Measure Benefits of the Simplified Acquisition Test Program,
GAO-03-1068 (Washington D.C.: Sept. 30, 2003).
[2] The Department of Defense uses the Defense Contract Action Data
System (DCADS) to supply data to FPDS.
[3] U.S. General Accounting Office, Small Business: HUBZone Program
Suffers from Reporting and Implementation Difficulties, GAO-02-57
(Washington D.C.: Oct. 26, 2001).
[4] U.S. General Accounting Office, Contract Management: Civilian
Agency Compliance with Revised Task and Deliver Order Regulations, GAO-
03-983 (Washington D.C.: Aug. 29, 2003).
[5] U.S. General Accounting Office, The Federal Procurement Data
System--Making It Work Better, GAO/ PSAD-80-33 (Washington D.C.: Apr.
18, 1980); and U.S. General Accounting Office, FPDS Improvements, GAO/
AIMD-94-178R (Washington, D.C.; Aug. 19, 1994).
