U.S. General Services Administration Administrator's Semiannual Management Report to the Congress Report No. 49 April 1, 2013 through September 30, 2013 U.S. General Services Administration Dan Tangherlini Administrator Office of Administrative Services Cynthia A. Metzler Chief Administrative Services Officer Management and Oversight Division Ralph L. Boldt Director November 2013 This report is in the public domain. Authorization to reproduce it in whole or in part is granted. While permission to reprint this publication is not necessary, the citation should be: U.S. General Services Administration, Office of Administrative Services, Management and Oversight Division, Administrator's Semiannual Management Report to Congress, No. 49, Washington, DC 20405. To obtain copies of this report: Write to: U.S. General Services Administration, Office of Administrative Services, Management and Oversight Division (H1C), 1800 F Street, NW Washington, DC 20405- 0001. E-mail your request to: Ralph.Boldt@gsa.gov Call in your request: (202) 501-3094 Obtain a copy of this report on the Agency's Web site at: Semiannual Report to Congress Table of Contents Synopsis of Audit Activity ........................................................................................................................... 5 Overview ....................................................................................................................................................... 6 U.S. General Administration Organization ........................................................................................... 6 Organization of Audit Follow-Up Program ............................................................................................... 7 Senior Agency Official ............................................................................................................................. 7 The Chief Administrative Services Officer ........................................................................................... 7 Heads of Services and Staff Offices and Regional Administrators .................................................. 7 Audits with Disallowed Costs ..................................................................................................................... 8 Audits with Better Use Funds ..................................................................................................................... 9 Internal Audits ............................................................................................................................................. 10 Internal Audits (continued)........................................................................................................................ 11 Audits under Appeal/Litigation ................................................................................................................. 12 Contract Audits ........................................................................................................................................... 13 Contract Audits (continued) ...................................................................................................................... 14 Contract Audits (continued) ...................................................................................................................... 15 Contract Audits (continued) ...................................................................................................................... 16 Contract Audits (continued) ...................................................................................................................... 17 Contract Audits (continued) ...................................................................................................................... 18 Contract Audits (continued) ...................................................................................................................... 19 Contract Audits (continued) ...................................................................................................................... 20 Contract Audits (continued) ...................................................................................................................... 21 Contract Audits (continued) ...................................................................................................................... 22 Contract Audits (continued) ...................................................................................................................... 23 Contract Audits (continued) ...................................................................................................................... 24 Contract Audits (continued) ...................................................................................................................... 25 Contract Audits (continued) ...................................................................................................................... 26 Contract Audits (continued) ...................................................................................................................... 27 Contract Audits (continued) ...................................................................................................................... 28 Glossary of Terms ..................................................................................................................................... 29 Appendix A ................................................................................................................................................. 31 Synopsis of Audit Activity This report covers the semiannual reporting period of April 1, 2013, through September 30, 2013. In accordance with the Inspector General Act of 1978, as amended (The Act), the Administrator of General Services submits this report to Congress on final actions regarding audit recommendations. The Act requires the Administrator to report directly to the Congress on management decisions and final actions taken on audit recommendations. This report provides a summary of all audits conducted during the reporting period for (1) implementation of the recommendations by GSA management contained in audit reports issued by the Office of Inspector General (OIG) and (2) report of cases where final action has not been taken on an audit one year after the date of the management decision. At the commencement of this semiannual reporting period, there were 155 audit reports pending final action that contained financial recommendations totaling $1,344,768,823. During the reporting period, the OIG issued a total of 411 audit reports on nationwide GSA programs and operations that required management decisions. Of these 41 audits, 17 of these audits found $4,197,817 in pre-award contracts and internal program spending that was incorrectly charged to the Government (known as disallowed costs). Of the 41 audits, 19 audits recommended that $691,706,447 could be used more efficiently (known as funds to be put to better use) if management took action to implement and complete the OIG recommendations. This information is disclosed within Appendix A of this report. During the six-month period, GSA was able to successfully take final action on a total of 27 audits. These audits represent the recovery of $4,497,086 in Government funds and the identification of $35,200,000 in potential future savings. As of September 30, 2013, 167 audit reports remained open. There are several audits involving claims under appeal or litigation during this reporting period. 1 This figure includes two audits, # A120101BFF13001 (the FY 2011 Financial Statement Audit) and A130064P6X13043, not reflected in the "Disallowed Cost" and "Better Use of Funds" charts because they are no-money audits. Overview This report, submitted pursuant to the Inspector General Act of 1978, as amended, presents management's perspective on audit resolution and follow-up activity at the U.S. General Services Administration (GSA) for the period beginning April 1, 2013 through September 30, 2013. This is the agency's 49th report to the Congress since the implementation of the Act (Public Law 100-504). The data in the report indicates that GSA's audit follow-up efforts continue to play a significant role in the effective management of the agency's operations and the accomplishment of its mission which results in better use of taxpayers’ dollars. U.S. General Administration Organization GSA is organized around two major business functions represented by the Federal Acquisition Service (FAS) and the Public Buildings Service (PBS). GSA houses the Office of Government-wide Policy, the Office of Citizen Services and Innovative Technologies, and a number of Staff Offices that provide support to the other GSA organizations. There are 11 regions in the GSA structure. The Administrator of General Services directs the execution of all GSA functions. Members of his office, as well as Regional Administrators and Heads of Services and Staff Offices, advise and make recommendations on policy or operational issues of national scope. They are also responsible for execution of programs and services within their service, region or staff office, under the leadership of the Administrator. Organization of Audit Follow-Up Program GSA has effective systems in place for keeping track of audit recommendations. In addition, GSA senior management is committed to ensuring that appropriate corrective action is taken. Agency managers have the responsibility to act upon the auditor's recommendations, with the audit resolution process being supervised by the agency audit follow-up official. A description of the responsibilities of GSA officials involved in the audit follow-up process is set forth below: Senior Agency Official The Deputy Administrator is the Senior Agency Official responsible for audit follow-up in the agency. As such, she has overall responsibility for ensuring the adequacy of the agency's follow-up system, monitoring the resolution of audit recommendations, and ensuring the prompt implementation of corrective actions. She also makes final decisions to resolve differences between agency management and the OIG. The Chief Administrative Services Officer The Chief Administrative Services Officer provides direction and oversight to the officials in the Office of Administrative Services (OAS) who manage the GSA's Audit Resolution and Follow-up System. Their responsibilities include: Acting as the liaison with the Government Accountability Office (GAO) for the coordination of GAO audits in progress within GSA and for preparation of responses and reports for the signature of the Administrator on GAO recommendations as required by law; Ensuring timely resolution and implementation of internal and external audit recommendations made by the GAO as well as OIG; Overseeing the collection and proper accounting of amounts determined due to the Government as the result of audit-related claims; Analyzing GSA's programs, upon request from the Administrator, particularly as related to past or present audit recommendations; and, Maintaining an automated report control system for both internal and external audits that provides an accurate means for tracking and documenting actions taken in implementing audit recommendations. Heads of Services and Staff Offices and Regional Administrators Heads of Services and Staff Offices and Regional Administrators, to whom audit recommendations pertain, have primary responsibility for resolving and implementing recommendations promptly. Their responsibilities include: Ensuring controls are implemented to provide timely, accurate, and complete responses to audit reports; Developing, advocating, and documenting agency positions on audit recommendations; Preparing responses to draft and final GAO reports in coordination with OAS; Providing comments on audit decision papers prepared by the OIG to ensure that management's position on unresolved audit recommendations is properly stated. Audits with Disallowed Costs April 1, 2013 through September 30, 2013 Final action for the six-month period Ending September 30, 2013 Number of Audit Reports Disallowed Costs A. Audit reports for which final action had not been taken by the commencement of the reporting period. 55 $42,219,688 B. Audit reports on which management decisions were made during the reporting period. C. Audit reports on which final action was taken during the reporting period. 17 $4,197,817 12 $8,642,003 (i) the dollar value of disallowed costs $4,497,086 - collections................. $4,191,448 - offset ................... $305,638 - property in lieu of $0 cash... - surplus ............... $49,653 - other ............... $0 (ii) the dollar value of disallowed costs that were written off by management. D. Audit reports for which no final action has been taken by the end of the reporting period. $4,194,570 60 $37,775,502 Audits with Better Use Funds April 1, 2013 through September 30, 2013 Final action for the six-month Ending September 30, 2013 Number of Audit Reports No budget Impact (Actual and Estimated) Budget Impact A. Audit reports for which final action had not been taken by the commencement of the reporting period. B. Audit reports on which management decisions were made during the reporting period. C. Audit reports on which final action was taken during the reporting period. (i) the actual dollar value of recommendations that were actually completed. (ii) the actual dollar value of recommendations that management has subsequently concluded should not or could not be implemented or completed. (iii) the actual dollar value of recommendations that management has subsequently concluded should not or could not be determined (calculated). (iv) the estimated dollar value of ''funds to be put to better use'' as agreed to by GSA management and the OIG. D. Audit reports for which no final action has been taken by the end of the reporting period. 100 $1,302,549,135 $0 22 $691,706,447 $0 15 $35,200,000 $0 $0 $0 $0 $0 $0 $0 $35,200,000 $0 107 $1,674,997,423 $0 Internal Audits Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER TITLE OF REPORT DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION PROJECTED COMPLETION DATE Disallowed Costs Better Use Funds A090172PRR11013 Recovery Act Report - GT "Mickey" Leland Federal Building Renovation Project: Construction Contract Audit of PBS's Major Construction and Modernization Projects Funded by The American Recovery and Reinvestment Act of 2009 08/19/2011 $0 $0 July 12, 2012: Meeting held between PBS, OIG and H1C from 10:30 - 11:00am. See action plan. 01/15/2014 A110100Q9P12009 Audit of Management Controls Within the Network Services Division Pacific Rim Region, Federal Acquisition Service 05/30/2012 $0 $0 Open, implementing corrective action plan (CAP). 02/15/2014 A110072Q6P11004 Review of the Federal Acquisition Service's National Customer Service Center 03/31/2011 $0 $0 Action plan is in the implementation stage. 01/15/2014 A110117Q2P12005 Audit of Personal Property Donation Program: New Jersey State Agency for Surplus Property, Federal Acquisition Service, Northeast and Caribbean Region 03/30/2012 $0 $0 Received signed corrective action plan (CAP) from OIG. 04/15/2014 Internal Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER TITLE OF REPORT DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION PROJECTED COMPLETION DATE Disallowed Costs Better Use Funds A110103BFF12001 Audit of the General Services Administration's Fiscal Year 2011 Financial Statements 12/22/2011 $0 $0 Open, implementing CAP. 12/31/2013 A110095QFP11008 FY 2011 Office of Inspector General Information Technology Security Audit of the GSA SmartPay - Citibank 09/30/2011 $0 $0 12/15/2011: Received approved Action Plan; Implementation of the Action Plan has commenced. 02/15/2014 A110096QFP11009 FY 2011 Office of Inspector General Information Technology Security Audit of the AT&T Operational Support System 09/30/2011 $0 $0 1/9/2012: OIG has issued approved Action Plan. Action Plan is now in the implementation phase. 07/15/2014 A120054OFF12003 FY 2012 Office of Inspector General Information Technology Security Audit of the Data.gov Terremark System 03/29/2012 $0 $0 Open. Received the signed decision record (DR) and corrective action plan from OCSIT. 11/15/2013 Audits under Appeal/Litigation REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS Disallowed Costs Better Use Funds A100183P9X11054 Moshe Safdie and Associates, Inc. 05/17/2011 $0 $2,735,713 A110070P9X11058 Bergelectric Corporation 06/01/2011 $0 $2,828,737 A100170P9X11077 Caddell Construction Company, Incorporated 07/27/2011 $0 $5,948,364 A100174P2X11076 Leon D.-Dematteis-Construction Corporation 07/25/2011 $0 $1,401,452 A110102P5X11083 W.G. Yates & Sons Construction Company 08/10/2011 $0 $4,018,977 A110021P9X11093 Myrex Industries 09/08/2011 $0 $5,773,586 A110153P5X12012 Letsos Company, SubContractor to W.G. Yates & Sons Construction Company 12/19/2011 $0 $1,143,212 A120065P9X12019 Bergelectric Corporation 02/03/2012 $0 $322,910 A120069P9X12039 Cleveland Construction, Inc. 05/09/2012 $0 $1,207,623 A120063P9X12055 Caddell Construction Co., Inc. 08/09/2012 $0 $7,975,645 A120121P9X12064 Alutiiq International Solutions, LLC 09/18/2012 $0 $1,692,286 A100148P9X10087 Alutiiq International Solutions, LLC 09/16/2010 $0 $4,096,596 A090112Q6X11060 ITS Services, Inc. 06/07/2011 $21,927,177 $0 A120070P9X12029 Cobb Mechanical Contractors 03/28/2012 $0 $194,480 Contract Audits Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A090192Q2X11015 SHI International Corporation 11/24/2010 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100172Q6X11020 New England Woodcraft, Inc. 12/27/2010 $10,850 $0 In the Process of Collection - GSA is in the process of collecting funds owed the government from the Contractor A100183P9X11054 Moshe Safdie and Associates, Inc. 05/17/2011 $0 $2,735,713 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A110070P9X11058 Bergelectric Corporation 06/01/2011 $0 $2,828,737 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A110087Q3X11057 National Interest Security Company, LLC 12/27/2010 $649,465 $5,728,148 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A100193Q4X11014 The Stratix Corporation 11/24/2010 $41,168 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100213P9X11023 Cobb Mechanical Contractors, Colorado Springs, CO 01/27/2011 $0 $4,864,953 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100075Q7X11022 Cort Business Services Corporation 01/27/2011 $0 $1,575,000 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100114Q2X11036 Ahurs Scientific, Inc. 03/29/2011 $123,252 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100171P9X11025 Layton Construction Company, Inc. 02/02/2011 $0 $1,899,985 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110044Q7X11051 Vaisala, Inc. 05/12//2011 $1,243 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A110063QAX11053 IntelliDyne, LLC 05/16/2011 $3,948,160 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110115Q7X11061 Pacific Star Communications, Inc. 06/10/2011 $23,201 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100221Q6X11052 Mainline Information Systems, Inc. 05/12/2011 $208,889 $867,904 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A080177Q9X09015 Tecolote Research, Incorporated 12/12/2008 $0 $658,765 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A080136Q2X09028 Dynamic Decisions, Inc. 01/20/2009 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090045Q7X11066 C-Tech Industries Inc. / Karcher North America, Inc. 06/30//2011 $99,693 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A110098P5X11069 KenMor Electric Company, L.P. 07/06/2011 $0 $1,045,954 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110132PRX11067 R.A. Heintges & Associates 07/08/2011 $0 $95,839 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110132PRX11068 Smith-Miller & Hawkinson Architects, LLP 07/08/2011 $0 $6,225,926 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110140PAX11071 Architect/Engineering Proposal Lehman Smith McLeish, PLLC, SubContractor to Smith- Miller & Hawkinson Architects LLP 07/14/2011 $0 $176,478 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090112Q6X11060 ITS Services, Inc. 06/07/2011 $21,927,177 $0 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A100140Q5X11070 Veterans Imaging Products, Inc. 07/07/2011 $3,893 $496,000 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A110088Q3X11079 Global Protection USA, Inc. 07/28/2011 $29,337 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110109Q41X11078 Security Consultants Group, Incorporated 07/27/2011 $0 $83,119,440 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100170P9X11077 Caddell Construction Company, Incorporated 07/27/2011 $0 $5,948,364 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A100174P2X11076 Leon D.-Dematteis- Construction Corporation 07/25/2011 $0 $1,401,452 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A100182P2X11082 Security Construction Services, Inc. 08/03/2011 $0 $12,780 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100119Q6X11081 Noble Sales Co., Inc. 08/03/2011 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A110133PAX11080 Architect Engineer Proposal Arup USA, Inc., SubContractor to Smith- Miller & Hawkinson Architects LLP 08/04/2011 $0 $134,505 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110102P5X11083 W.G. Yates & Sons Construction Company 08/10/2011 $0 $4,018,977 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A110180P9X11084 RTKL Associates, Inc. 08/15/2011 $0 $412,057 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110111Q7X11086 Thermo Electron North America , LLC 08/19/2011 $0 $249,000 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090196P2X11087 Bovis Lend Lease LMB, Inc. 08/22/2011 $0 $33,438 Price/Settlement Negotiated - Negotiations have been completed between Contracting Officer and Contractor A110136Q3X11088 Konica Minolta Business Solutions U.S.A., Inc. 08/25/2011 $11,599 $35,625,685 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A110182P4X11090 Hensel Phelps Construction Company 09/01/2011 $0 $1,396,219 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110021P9X11093 Myrex Industries . 09/08/2011 $0 $5,773,586 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A110067Q2X11092 Clifton Gunderson, LLP 09/09/2011 $1,374 $1,196,561 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110174Q4X11097 Protective Products Enterprises 09/15/2011 $63,992 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110122Q9X11096 Agilent Technologies, Incorporated 09/14/2011 $110,662 $307,400 In the Process of Collection - GSA is in the process of collecting funds owed the government from the Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A110146P9X11095 White Construction Company 09/12/2011 $0 $829,494 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100210Q5X12001 Labat-Anderson, Inc. 10/13/2011 $0 $3,200,000 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110197Q3X12003 KDH Defense Systems, Inc. 11/15/2011 $1,331 $16,781,668 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110177P5X12006 Way Engineering Ltd. 01/31/2012 $0 $412,921 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110176Q4X12010 Fontaine Trailer Company, Incorporated 12/07/2011 $0 $4,648,519 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090106Q3X09084 Perot Systems Government Services, Inc. 08/19/2009 $34,758 $33,743,210 In the Process of Collection - GSA is in the process of collecting funds owed the government from the Contractor A090090Q2X09086 Ezenia!, Inc. 08/21/2009 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A110153P5X1212 Letsos Company, SubContractor to W.G. Yates & Sons Construction Company 12/19/2011 $0 $1,143,212 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A110178Q3X12014 Sharp Electronics Corporation 12/22/2011 $49,653 $6,752,403 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110191QAX12016 Paradigm Technologies, Inc. 12/27/2011 $0 $2,557,773 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110198Q4X12015 Scott Technologies Incorporated 12/27/2011 $24,137 $5,727,277 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110186Q7X12018 BRSI, L.P. 01/23/2012 $0 $7,425,000 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110152Q9X12017 Technology Associates International Corporation 01/19/2012 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A120065P9X12019 Bergelectric Corporation 02/03/2012 $0 $322,910 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A120075P4X12020 Enola Contracting Services, Inc. 02/08/2012 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110097Q7X12024 Dell Marketing, L.P. 03/01/2012 $0 $142,125,280 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A120021Q3X12023 Presidio Networked Solutions, Inc. 03/02/2012 $31,878 $2,427,935 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110200Q5X12025 Deco, Inc. 03/07/2012 $24,690 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A120074Q5X12028 Kimball International, Inc. 03/27/2012 $0 $29,500,000 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A120070P9X12029 Cobb Mechanical Contractors 03/28/2012 $0 $194,480 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A120090Q3X12032 Mine Safety Appliances Company 04/10/2012 $1,511 $3,270,118 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110143Q5X12034 The J. Diamond Group, Inc. 04/12/2012 $8,555 $21,200,000 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A120086Q3X12035 The Analysis Corporation (TAC) 04/23/2012 $103,238 $10,356,816 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110213Q4X12036 Miami Air International, Incorporated 05/01/2012 $8,428 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110216Q6X12037 Learning Tree International USA, Inc. 05/02/2012 $43,996 $16,091,515 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A120069P9X12039 Cleveland Construction, Inc. 05/09/2012 $0 $1,207,623 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A110207Q3X12041 Analytical Graphics, Inc. 05/17/2012 $0 $5,561,067 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A120112P2X12045 Brooks Range Contract Services, Inc. 05/30/2012 $0 $2,735,134 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A120059Q3X12046 The MIL Corporation 05/31/2012 $77,733 $3,960,000 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110169Q3X12048 Oce North America, Inc. 06/29/2012 $225,180 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110166Q2X12049 Pitney Bowes, Inc. 07/05/2012 $0 $7,076,483 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A120126Q5X12050 Hamilton Products Group, Inc. 07/06/2012 $0 $15,000,000 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A120063P9X12055 Caddell Construction Co., Inc. 08/09/2012 $0 $7,975,645 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A080030Q3X09087 Hewlett-Packard Company 08/21/2009 $59,353 $81,038,538 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090254PCX09097 Greenhorne & O'Mara, Inc. 09/04/2009 $0 $118,000 Price/Settlement Negotiated - Negotiations have been completed between Contracting Officer A090074Q7X09099 TechFlow, Inc. 09/04/2009 $0 $4,373,215 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090232PCX09101 Haley & Aldrich, Inc. 09/09/2009 $0 $11,762 Price/Settlement Negotiated - Negotiations have been completed between Contracting Officer Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A090234PCX09102 HDR Architecture, Inc. 09/10/2009 $0 $809,387 Price/Settlement Negotiated - Negotiations have been completed between Contracting Officer A090202Q6X10016 Computech, Inc. 11/09/2009 $0 $19,043,879 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A080144Q7X10019 BMC Software, Inc. 11/17/2009 $0 $3,246,860 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090159Q5X10022 RCF Information Systems, Inc. 12/10/2009 $4,459 $522,882 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090145Q5X09082 BTAS, Inc. Beavercreek, OH 08/06/2009 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090222QWX10058 Force 3, Inc. 06/23/2010 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A080070QWX10063 Accenture, LLP 07/06/2010 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A090140Q6X10081 Systems Research and Applications Corporation 08/24/2010 $392,685 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A080124Q7X10086 ASAP SOFTWARE EXPRESS, INC. 09/15/2010 $739,985 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A100148P9X10087 Alutiiq International Solutions, LLC 09/16/2010 $0 $4,096,596 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process A100117QWX11001 Dun & Bradstreet, Inc. 10/07/2010 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A090133Q7X11005 SeaArk Marine, Inc. 10/27/2010 $1,130,227 $0 In the Process of Collection - GSA is in the process of collecting funds owed the government from the Contractor A090108Q5X10059 Integrated Data Services Inc. 06/24/2010 $0 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor Contract Audits (continued) Audits with Management Decisions made prior to September 30, 2012, but with Final Action not taken as of September 30, 2013 REPORT NUMBER NAME OF CONTRACTOR DATE OF REPORT MANAGEMENT DECISION AMOUNTS REASON FOR NO FINAL ACTION Disallowed Costs Better Use Funds A090130Q7X10076 Cort Business Furniture 08/16/2010 $83,696 $0 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A110147Q6X13010 Xerox Corporation 12/06/2012 $0 $8,511,087 In Negotiation - Negotiations are proceeding between Contracting Officer and Contractor A120121P9X12064 Alutiiq International Solutions, LLC 09/18/2012 $0 $1,692,286 Litigation in Process - The Contractor has appealed the Contracting Officer's decision and the audit is now in the litigation process Glossary of Terms The following definitions, based on the Inspector General Act Amendments of 1988, apply to terms used in this Semiannual Management Report: Questioned Costs. Costs questioned by the OIG as a result of: • an alleged violation of a provision of a law, regulation, contract, grant, cooperative agreement, or other agreement or document governing the expenditure of funds; • a finding that, at the time of an audit, such cost is not supported by adequate documentation; • a finding that the expenditure of funds for the intended purpose is unnecessary or unreasonable. Disallowed Cost. Questioned costs that GSA management in a management decision sustained or agreed should not be charged to the Government. Recommendation that Funds be Put to Better Use. A recommendation by the OIG that funds could be used more efficiently if management took action to implement and complete the recommendations, including: • reductions in outlays; • de-obligation of funds from programs or operations; • withdrawal of interest subsidy costs on loans or loan guarantees, insurance or bonds; • costs not incurred by implementing recommended improvements related to the operations of the establishment, a Contractor or grantee; • avoidance of unnecessary expenditures noted in pre-award reviews of contract or grant agreements; • any other savings that are identified specifically. Management Decision. The evaluation by management of the findings and recommendations included in an audit report and the issuance of a final decision by management concerning its response to such findings and recommendations, including planned corrective actions to remedy weaknesses identified in the report. Final Action. The completion of all actions that GSA management concluded in its management decision was necessary with respect to the findings and recommendations included in the audit report. In the event that GSA management concluded no action was necessary, final action occurred when the management decision was made. Management Actions - Questioned Costs. The following is a list of the different management actions used by GSA management to resolve questioned costs in an audit report. • Audit reports on which management decisions were made during the period: Data pertaining to the number of audit reports on which management decisions were made during the period and the associated amount of disallowed costs was furnished by the OIG. • Write-offs: For the purposes of this report, write-offs are interpreted to represent the difference between the disallowed cost and the amount successfully recovered. Management Actions - Better Use Funds. The following is a list of the different management actions used by GSA management to resolve the "better use" of funds in an audit report. • Better Use Funds: The figure represents amounts cited as "cost avoidance" and "funds to be put to better use," as agreed to by GSA management and the OIG. Prior to April 1990, no funds were identified by the OIG specifically as "funds to be put to better use," and no management decisions were issued based on the consideration of "better use" of funds. • Budget Impact Funds: Funds identified as "budget impact" involve the obligation process. Audit-related savings of these funds, depending on the particular fund involved, may be available for reprogramming. • No Budget Impact Funds: Funds identified as "no budget impact" are composed of estimated and actual amounts, and do not involve obligated monies, and, therefore, cannot be construed as having a material effect on GSA''s appropriated funds. • Audit reports on which management decisions were made during the period: Data pertaining to the number of audit reports on which management decisions were made during the period and the associated dollar amounts agreed to by management were furnished by the OIG. • Value of recommendations that management concluded should not or could not be calculable: Management was unable to determine the award amounts and "better use funds" implemented since the amount is included in the overall award to the prime Contractor and savings could not be determined. Appendix A U.S. General Services Administration 1800 F Street, NW Washington, DC 20405 www.gsa.gov