Report | Sept. 6, 2013

Improvements Needed at the Defense AdvancedResearch Projects Agency When Evaluating BroadAgency Announcement Proposals

DODIG-2013-126

Objective

Our objective was to determine whether the Defense Advanced Research Projects Agency (DARPA) properly awarded contracts from broad agency announcements (BAAs). Specifically, we reviewed contracts awarded and funded by DARPA from DARPA BAAs published in March 2011 through September 30, 2012. We reviewed 36 contracts awarded from 9 BAAs, with a value of about $426.4 million.  

Finding

DARPA personnel did not consistently adhere to the scientific review process and Federal Acquisition Regulation (FAR) requirements before awarding contracts from BAAs for 35 of 36 contracts. DARPA personnel did not fully implement the scientific review process or FAR requirements supporting the contract type selection. Specifically, DARPA personnel did not:

  • prepare evaluation reports with detailed,substantive narratives or adequate Program Manager Summary Sheets to support selectability determinations for 28 contracts because personnel did not follow internal policies to complete reports;
  • obtain contract funding document approvals for 12 contracts because personnel did not follow internal policies to obtain approval from the Scientific Review Official;
  • provide required support for the contract type selection or obtain approvals for the contract type one level above the contracting officer for 32 cost-reimbursement contracts because DARPA personnel assumed the FAR requirements did not apply; and
  • determine the adequacy of the contractors’ accounting systems for 13 of the 32 cost-reimbursement type contracts because personnel provided inadequate or no support for the adequacy of the systems. 

Although we did not identify any contracts that DARPA personnel should not have awarded, DARPA may not be able to justify that personnel adequately substantiated proposal selections. In addition, contracting personnel increased DARPA’s contracting risks when issuing cost-reimbursement contracts.  

Recommendations

We recommend that the Director, Defense Advanced Research Projects Agency, establish controls to verify scientific review process documentation is adequate. We recommend also reemphasizing internal requirements for approval of funding documentation, requirements within the cost-reimbursement interim rule, and the Federal Acquisition Regulation requirement to appropriately complete the determination of the adequacy of the contractor’s accounting system.  

Management Comments and Our Response

Management comments were responsive to the recommendations. DARPA agreed to issue guidance and implement training in response to the recommendations.