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GAO-10-527R: 

United States Government Accountability Office: 
Washington, DC 20548: 

March 31, 2010: 

Congressional Committees: 

Subject: Defense Budget: Fourth Quarter Obligation Rates and Contract 
Obligations for Fiscal Years 2006-09: 

This letter formally transmits the enclosed briefing in response to the 
National Defense Authorization Act for Fiscal Year 2010 (Pub. L. No. 
111-84), which requires GAO to review Department of Defense (DOD) 
policies related to year-end spending and the rate of obligations 
incurred by DOD in the fourth quarter of fiscal years 2006 through 
2009, as compared with the obligations incurred in the first three 
quarters of those fiscal years for both 1-year and multi-year 
appropriations. GAO is required to report to the Committees on Armed 
Services of the Senate and House of Representatives by March 31, 2010. 
On March 19, 2010, we provided the briefing to staff of your respective 
committees. 

We are sending copies of this report to the appropriate congressional 
committees. We are also sending copies to the Secretary of Defense and 
the Under Secretary of Defense (Comptroller) and the Secretaries of the 
Army, the Air Force, and the Navy. The report also is available at no 
charge on the GAO Web site at [hyperlink, http://www.gao.gov]. 

Should you or your staff have any questions concerning this report, 
please contact Sharon L. Pickup at (202) 512-9616 or Bill Woods at 
(202) 512-8214. Contact points for our Office of Congressional 
Relations and Public Affairs may be found on the last page of this 
report. Key contributors to this report were Donna Evans, Assistant 
Director; Robert Brown; Jason Jackson; Mae Jones; Julia Kennon; Lonnie 
McAllister; Charles Perdue; Stephen Pruitt; and Patrick Washington. 

Signed by: 

Sharon L. Pickup:
Director:
Defense Capabilities and Management: 

Enclosure: 

List of Committees: 

The Honorable Carl Levin:
Chairman:
The Honorable John McCain:
Ranking Member:
Committee on Armed Services:
United States Senate: 

The Honorable Ike Skelton:
Chairman:
The Honorable Howard McKeon:
Ranking Member:
Committee on Armed Services:
House of Representatives: 

[End of section] 

Enclosure: 

DOD's Fourth Quarter Obligation Rates and Contract Obligations for 
Fiscal Years 2006-09: 

Briefing for Congressional Committees: 

March 31, 2010: 

Overview: 

* Objectives; 
* Background; 
* Scope & Methodology; 
* Objective 1: 
- Policies and Guidance for Obligating Funds; 
* Objective 2: 
- Fourth Quarter Obligation Rates for MILPERS; 
- Fourth Quarter Obligation Rates for O&M; 
- Obligation Rates for Procurement; 
- Obligation Rates for RDT&E; 
* Objective 3: 
- Fiscal Years 2006-09 Contract Obligations; 
- Undefinitized Contract Actions (UCAs). 

Objectives: 

1) To what extent has DOD established policies or guidance regarding 
the obligation of funds in the fourth quarter of the fiscal year? 

2) To what extent has DOD incurred obligations in the fourth quarter 
of fiscal years 2006-09 for both 1-year and multi-year appropriations? 

3) To what extent has DOD incurred contract obligations in the fourth 
quarter of a fiscal year as compared with obligations incurred in the 
previous three quarters, and to what extent are those fourth quarter 
obligations incurred for competitive contracts? 

Background: 

The Fiscal Year 2010 National Defense Authorization Act requires GAO 
to review obligations incurred by the DOD in the fourth quarter of 
fiscal years 2006-09 for 1-year and multi-year appropriations and to: 

* compare those obligations with those incurred in the first three 
quarters of the fiscal year and; 

* determine whether DOD's financial execution policies contributed to 
hastened year-end spending. 

DOD has certain time frames to obligate funds for its various 
appropriation accounts: 

* For 1-year appropriations such as Military Personnel (MILPERS) and 
Operation & Maintenance (O&M) accounts, DOD generally has 1 year to 
obligate funds before they expire and; 

* For multi-year appropriations, such as Procurement and Research, 
Development, Test & Evaluation (RDT&E), DOD generally has 3 and 2 
years, respectively, to obligate funds before they expire. 

The Conference Report, H. Rept. 111-288, accompanying the Fiscal Year 
2010 National Defense Authorization Act noted: 

* In 1979 and 1980, the Senate Subcommittee on Oversight of Government 
Management held hearings and issued a report entitled Hurry-Up 
Spending in which it found that the rush to obligate expiring funds 
before the end of the fiscal year frequently resulted in lack of 
competition, poorly defined statements of work, inadequately 
negotiated contracts, and the procurement of low-priority items or 
services. 

* The Subcommittee's work contributed to the passage of the 
Competition in Contracting Act of 1984 (P.L. 98-369, Div. B., title 
VIII). 

In 1998, GAO reported that systemic procurement reforms, including the 
Competition in Contracting Act of 1984, had addressed most issues 
raised in the Subcommittee's report but that some problems persisted 
(See Year End Spending: Reforms Underway but Better Reporting and 
Oversight Needed, GAO/AIMD-98-185). 

Contracts generally must be competed, but there are statutory 
exceptions (such as urgency) that permit non-competitive awards. 

Agencies also can use undefinitized contract actions (UCAs) when they 
need to make awards before reaching agreement on all contract terms. 
GAO has reported that UCAs are considered to be risky for the 
government because contractors lack incentives to control costs before 
reaching final agreement on contract terms. (See Defense Contracting: 
DOD Has Enhanced Insight into Undefinitized Contract Action Use, but 
Management at Local Commands Needs Improvement, GA0-10-299). 

Scope & Methodology: 

Reviewed legislation, DOD's Financial Management Regulation, and 
internal budget guidance and policies from the Office of the Under 
Secretary of Defense, Comptroller and service components. 

Interviewed officials from the Office of the Under Secretary of 
Defense, Comptroller and service components to determine whether DOD 
had established guidance or policies concerning the obligation of 
funds in the fourth quarter. 

Obtained data on obligation rates from Under Secretary of Defense, 
Comptroller and Defense Finance and Accounting Service data for 1-year 
appropriations (MILPERS and O&M) and multi-year appropriations 
(Procurement and RDT&E) for fiscal years 2006-09. For purposes of this 
analysis, we reviewed active and reserve component obligations for 
each of the military services, which include both base and 
supplemental funding for each fiscal year. 

* For 1-year appropriations, we compared obligation rates incurred in 
the fourth quarter to obligation rates incurred in the total remaining 
three quarters. 

* For multi-year appropriations, we identified total obligation rates 
for each year of the appropriated funds' availability and for the 
fourth quarter of the last year of availability. 

* To analyze appropriations whose last year of availability fell in 
fiscal years 2006-09, the time period specified in the mandate, in 
some cases, we had to obtain obligation data from fiscal years prior 
to 2006. For example: 

- For Procurement appropriations, which have 3 years of availability, 
we reviewed fiscal years 2004-09 data. 

- For RDT&E appropriations, which have 2 years of availability, we 
reviewed fiscal years 2005-09 obligation data. 

Since 1995, GAO has designated DOD's financial management as a high-
risk area due to, among other things, DOD's pervasive financial and 
related business management system deficiencies. For example, we have 
reported on the unreliability of DOD's financial transaction data, 
including accounting for obligations, and the lack of reasonable 
assurance over DOD's compliance with legal limitations on the use of 
appropriated funds. Consequently, we are unable to ensure that DOD's 
reported obligations are complete, reliable, and accurate, and they 
should therefore be considered approximations. For the purposes of our 
review, we verified that the data we collected were consistent with 
the data recorded in source documents, but we did not independently 
assess the reliability of the data. 

We used unaudited Federal Procurement Data System-Next Generation 
(FPDS-NG) data to identify both the percentage and dollar amounts 
obligated for competed and non-competed contracts in fiscal years 2006 
through 2009. The system does not break down contracting data by 
appropriation. We believe that the system's data used for these 
analyses are sufficiently reliable for the purposes of this review. 
However, the data on UCAs were not sufficiently reliable. 

We conducted this performance audit from November 2009 to March 2010 
in accordance with generally accepted government auditing standards 
(GAGAS). Those standards require that we plan and perform the audit to 
obtain sufficient, appropriate evidence to provide a reasonable basis 
for our findings and conclusions based on our audit objectives. We 
believe that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. 

DOD provided technical comments on a draft of this product, which we 
incorporated. 

Objective 1: Policies and Guidance for Obligating Funds: 

Neither DOD nor the military services have policies or guidance that 
specifically address the obligation of funds in the fourth quarter of 
the fiscal year. However, the Air Force has developed guidance that 
discourages spending resources at the end of the fiscal year merely 
because they are available, and encourages reporting unused funds to 
headquarters. 

DOD is subject to a statutory limitation (the 80/20 rule) that states: 
not more than 20 percent of 1-year appropriations may be obligated 
during the last 2 months of the fiscal year. 

* A passage in the DOD Financial Management Regulation refers to the 
80/20 rule and states: Each year, the general provisions of the DOD 
Appropriations Act require a certification that not more than 20 
percent of the appropriations in that act, which are limited for 
obligation during the current fiscal year, shall be obligated during 
the last 2 months of the fiscal year (i.e. the "80/20 rule). 
Supplemental funds are not subject to the 80/20 rule. 

* The Office of the Under Secretary of Defense, Comptroller and the 
service components create annual spending plans to monitor obligations 
throughout the year and use this information to certify whether the 
80/20 rule was addressed. 

Objective 2: Fourth Quarter Obligation Rates for MILPERS--Active and 
Reserve Components: 

For fiscal years 2006 through 2009, the active and reserve components 
obligated between 25.1 percent and 26.6 percent of its MILPERS 
appropriations in the fourth quarter, as shown on the following slide. 

DOD officials explained that obligation rates may appear higher in the 
fourth quarter because, for example, of cyclical occurrences, such as 
a summer surge in recruiting, an increase of troop end-strength, and 
an increased availability of reserve component members for annual 
training during the summer months. DOD officials also explained that 
other factors, such as a higher rate of permanent change of station 
actions may affect fourth quarter obligation rates as well. 

Figure: Fourth Quarter Obligation Rates for MILPERS--Active and 
Reserve Components: 

[Refer to PDF for image: 4 pie-charts] 

Fiscal year 2006: 
QTR 1-3 obligations: 74.9%; $86.5 billion; 
QTR 4 obligations: 25.1%; $28.9 billion. 

Fiscal year 2007: 
QTR 1-3 obligations: 73.3%; $87.1 billion; 
QTR 4 obligations: 26.7%; $31.6 billion. 

Fiscal year 2008: 
QTR 1-3 obligations: 74.1%; $92.8 billion; 
QTR 4 obligations: 25.9%; $32.4 billion. 

Fiscal year 2009: 
QTR 1-3 obligations: 73.7%; $98.9 billion; 
QTR 4 obligations: 26.3%; $35.2 billion. 

Source: GAO analysis of DOD data. 

[End of figure] 

Objective 2: 
Fourth Quarter Obligation Rates for MILPERS by Service Component--
Active: 

Fourth quarter MILPERS obligation rates for the active service 
components ranged from 24.2 percent to 27.3 percent for fiscal years 
2006 through 2009, as shown on the following slide. 

DOD officials explained that obligation rates may appear higher in the 
fourth quarter because, for example, of cyclical occurrences, such as 
a summer surge in recruiting, an increase of troop end-strength. DOD 
officials also explained that other factors, such as a higher rate of 
permanent change of station actions may affect fourth quarter 
obligation rates as well. 

Table: Fourth Quarter MILPERS Obligation Rates by Active Service 
Component (FY 2006-09): 

Active service component: Army; 
2006: 24.2%; 
2007: 27.3%; 
2008: 25.6%; 
2009: 26.6%. 

Active service component: Air Force; 
2006: 25.7%; 
2007: 26.6%; 
2008: 26.4%; 
2009: 25.8%. 

Active service component: Navy; 
2006: 25.3%; 
2007: 25.4%; 
2008: 24.9%; 
2009: 25.0%. 

Active service component: Marine Corps; 
2006: 24.9%; 
2007: 25.4%; 
2008: 25.7%; 
2009: 26.3%. 

Source: GAO analysis of DOD data. 

[End of table] 

Objective 2: Fourth Quarter Obligation Rates for MILPERS by Service 
Component--Reserve: 

Fourth quarter MILPERS obligation rates for the reserve service 
components ranged from 17.9 percent to 30.4 percent for fiscal years 
2006 through 2009, as shown on the following slide. 

DOD officials explained that obligation rates may appear higher in the 
fourth quarter because, for example, of cyclical occurrences, such as 
a summer surge in recruiting, an increase of troop end-strength, and 
an increased availability of reserve component members for annual 
training during the summer months. 

Table: Fourth Quarter MILPERS Obligation Rates by Reserve Service 
Component (FY 2006-09): 
				
Reserve	service component:Army Reserve; 
2006: 29.2%; 
2007: 27.2%; 
2008: 27.9%; 
2009: 29.5%. 

Reserve	service component:Army Guard; 
2006: 27.9%; 
2007: 30.4%; 
2008: 28.4%; 
2009: 29.4%. 

Reserve	service component:Air Force Reserve; 
2006: 19.5%; 
2007: 20.6%; 
2008: 20.7%; 
2009: 17.9%. 

Reserve	service component:Air Guard; 
2006: 22.3%; 
2007: 23.8%; 
2008: 26.9%; 
2009: 25.0%. 

Reserve	service component:Navy Reserve; 
2006: 24.8%; 
2007: 28.1%; 
2008: 27.4%; 
2009: 26.8%. 

Reserve	service component:Marine Corps Reserve; 
2006: 23.7%; 
2007: 23.4%; 
2008: 22.2%; 
2009: 30.0%. 

Source: GAO analysis of DOD data. 

[End of table] 

Objective 2: Fourth Quarter Obligation Rates for O&M--Active and 
Reserve Components: 

For fiscal years 2006 through 2009, the active and reserve components 
obligated between 27.6 percent and 29.5 percent of its O&M 
appropriations in the fourth quarter, as shown on the following slide. 

DOD officials explained that obligation rates may appear higher in the 
fourth quarter because, for example, DOD received supplemental funding 
late in the fiscal year. 

Figure: Fourth Quarter Obligation Rates for O&M--Active and Reserve 
Components: 

[Refer to PDF for image: 4 pie-charts] 

Fiscal year 2006: 
QTR 1-3 obligations: 70.5%; $113.8 billion; 
QTR 4 obligations: 29.5%; $47.6 billion. 

Fiscal year 2007: 
QTR 1-3 obligations: 72.4%; $127.3 billion; 
QTR 4 obligations: 27.6%; $48.5 billion. 

Fiscal year 2008: 
QTR 1-3 obligations: 72.4%; $141.5 billion; 
QTR 4 obligations: 27.6%; $53.9 billion. 

Fiscal year 2009: 
QTR 1-3 obligations: 71.7%; $141.4 billion; 
QTR 4 obligations: 28.3%; $55.8 billion. 

Source: GAO analysis of DOD data. 

[End of figure] 

Objective 2: Fourth Quarter Obligation Rates for O&M by Service 
Component--Active: 

Fourth quarter O&M obligation rates for the active service components 
ranged from 23.3 percent to 32.2 percent for fiscal years 2006 through 
2009 as shown on the following slide. 

DOD officials explained that obligation rates may appear higher in the 
fourth quarter because, for example, DOD received supplemental funding 
late in the fiscal year. 
					
Table: Fourth Quarter O&M Obligation Rates by Active Service Component 
(FY 2006-09): 

Active service component: Army; 
2006: 31.0%; 
2007: 25.6%; 
2008: 27.1%; 
2009: 31.0%. 

Active service component: Air Force; 
2006: 31.9%; 
2007: 32.1%; 
2008: 30.2%; 
2009: 29.0%. 

Active service component: Navy; 
2006: 25.7%; 
2007: 27.1%; 
2008: 25.6%; 
2009: 23.3%. 

Active service component: Marine Corps; 
2006: 32.0%; 
2007: 27.1%; 
2008: 32.2%; 
2009: 31.9%. 

Source: GAO analysis of DOD data. 

[End of table] 

Objective 2: Fourth Quarter Obligation Rates for O&M by Service 
Component--Reserve: 

For fiscal years 2006 through 2009, fourth quarter obligation rates 
for the reserve component ranged from 19.6 percent to 41 percent as 
shown on the following slides. 

DOD officials explained that obligation rates may appear higher in the 
fourth quarter because, for example, DOD received supplemental funding 
late in the fiscal year. 

Table: Fourth Quarter O&M Obligation Rates by Reserve Service 
Component (FY 2006-09): 

Reserve service component: Army Reserve; 
2006: 27.7%; 
2007: 30.0%; 
2008: 30.6%; 
2009: 28.8%. 

Reserve service component: Army Guard; 
2006: 26.0%; 
2007: 26.5%; 
2008: 21.9%; 
2009: 25.2%. 

Reserve service component: Air Force Reserve; 
2006: 27.3%; 
2007: 28.5%; 
2008: 25.3%; 
2009: 25.6%. 

Reserve service component: Air Guard; 
2006: 21.9%; 
2007: 25.0%; 
2008: 26.5%; 
2009: 22.8%. 

Reserve service component: Navy Reserve; 
2006: 25.7%; 
2007: 26.2%; 
2008: 26.1%; 
2009: 19.7%. 

Reserve service component: Marine Corps Reserve; 
2006: 38.8%; 
2007: 19.6%; 
2008: 41.0%; 
2009: 22.7%. 

Source: GAO analysis of DOD data. 

[End of table] 

Objective 2: Obligation Rates for Procurement for Service Components--
Active: 

For procurement, the active service components obligated 75.3 percent 
or more of the appropriation in the first year that funding was 
available and then significantly smaller percentages in the second and 
third years. 

For the fourth quarter of the third year of funding availability, 
obligation percentages were 1.9 percent or less, as shown on the 
following slide. 

Table: Procurement Obligation Rates by Year of Funding Availability 
(FY 2006-09): 

Funding availability by fiscal year: 2004-06; 
1st year: 89.9%; 
2nd year: 7.7%; 
3rd year: 2.4%; 
Fourth quarter, 3rd year: 1.0%. 

Funding availability by fiscal year: 2005-07; 
1st year: 86.9%; 
2nd year: 10.5%; 
3rd year: 2.5%; 
Fourth quarter, 3rd year: 0.8%. 

Funding availability by fiscal year: 2006-08; 
1st year: 80.8%; 
2nd year: 15.7%; 
3rd year: 3.5%; 
Fourth quarter, 3rd year: 1.5%. 

Funding availability by fiscal year: 2007-09; 
1st year: 75.3%; 
2nd year: 19.3%; 
3rd year: 5.4%; 
Fourth quarter, 3rd year: 1.9%. 

Source: GAO analysis of DOD data. 

[End of table] 

Objective 2: Obligation Rates for Procurement: 

For procurement, the active service components obligated 70.8 percent 
or more of the appropriation in the first year that funding was 
available and then obligated significantly smaller percentages in the 
second and third years. 

For the fourth quarter of the third year of funding availability, 
obligation rates were 2.7 percent or less, as shown on the following 
slide. 

Table: Procurement Obligation Rates by Year of Funding Availability by 
Service (FY2009): 

Service: Army; 
1st year, FY 2007: 75.5%; 
2nd year, FY 2008: 20.2%; 
3rd year, FY 2009: 4.3%; 
Fourth Quarter 3rd year, FY 2009: 1.1%. 

Service: Air Force; 
1st year, FY 2007: 75.1%; 
2nd year, FY 2008: 18.6%; 
3rd year, FY 2009: 6.3%; 
Fourth Quarter 3rd year, FY 2009: 2.7%. 

Service: Navy; 
1st year, FY 2007: 76.7%; 
2nd year, FY 2008: 17.6%; 
3rd year, FY 2009: 5.7%; 
Fourth Quarter 3rd year, FY 2009: 2.2%. 

Service: Marine Corps; 
1st year, FY 2007: 70.8%; 
2nd year, FY 2008: 23.1%; 
3rd year, FY 2009: 6.1%; 
Fourth Quarter 3rd year, FY 2009: 1.4%. 

Source: GAO analysis of DOD data. 

[End of table] 

Objective 2: Obligation Rates for RDT&E: 

For RDT&E, the active service components obligated 86.5 percent or 
more of the appropriation in the first year that funding was available 
and then significantly smaller percentages in the second year. 

For the fourth quarter of the second year of funding availability, 
obligations rates were 2.7 percent or less, as shown on the following 
slide. 

Table: RDT&E Obligation Rates by Year of Funding Availability (FY 2006-
09): 

Funding	availability by	fiscal year: 2005-06; 
1st year: 91.0%; 
2nd year: 9.0%; 
Fourth quarter, 2nd year: 1.6%. 

Funding	availability by	fiscal year: 2006-07; 
1st year: 88.6%; 
2nd year: 11.4%; 
Fourth quarter, 2nd year: 1.9%. 

Funding	availability by	fiscal year: 2007-08; 
1st year: 88.7%; 
2nd year: 11.3%; 
Fourth quarter, 2nd year: 2.3%. 

Funding	availability by	fiscal year: 2008-09; 
1st year: 86.5%; 
2nd year: 13.6%; 
Fourth quarter, 2nd year: 2.7%. 

Source: GAO analysis of DOD data. 

[End of table] 

Objective 2: Obligation Rates for RDT&E: 

For RDT&E, the active service components obligated 84 percent or more 
of the appropriation in the first year that funding was available and 
then significantly smaller percentages in the second year. 

The percentage of RDT&E funds obligated in the fourth quarter of the 
last year of funding availability was 2.9 percent or less, as shown on 
the following slide. 

Table: RDT&E Obligation Rates by Service by Year of Funding 
Availability (FY 2009): 

Service: Army; 
1st year, FY 2008: 88.3%; 
2nd year, FY 2009: 11.7%; 
Fourth quarter, 2nd year, FY 2009: 2.5%. 

Service: Air Force; 
1st year, FY 2008: 84.0%; 
2nd year, FY 2009: 16.0%; 
Fourth quarter, 2nd year, FY 2009: 2.9%. 

Service: Navy; 
1st year, FY 2008: 88.7%; 
2nd year, FY 2009: 11.3%; 
Fourth quarter, 2nd year, FY 2009: 2.4%. 

Source: GAO analysis of DOD data. 

Note: The Marine Corps is included in the Navy's RDT&E appropriation. 

[End of table] 

Objective 3: Fiscal Years 2006-2009 Contract Obligations: 

Contract obligations by quarter for fiscal years 2006 through 2009 
vary and show no consistent pattern. 

Figure: Fiscal Years 2006-2009 Contract Obligations: 

[REfer to PDF for image: 4 pie-charts] 

Total 2006 contract obligations, $298.5 billion: 
Q1: 22.3%; 
Q2: 31.1%; 
03: 18.9%; 
Q4: 27.7%. 

Total 2007 contract obligations, $329.3 billion: 
Q1: 30.2%; 
Q2: 22.6%; 
03: 19.7%; 
Q4: 27.5%. 

Total 2008 contract obligations $377.8 billion: 
Q1: 23.5%; 
Q2: 25.6%; 
03: 18.5%; 
Q4: 32.4%. 

Total 2009 contract obligations $379.8 billion: 
Q1: 27.5%; 
Q2: 23.4%; 
03: 19.0%; 
Q4: 30.1%. 		 

Source: GAO analysis of Federal Procurement Data System-Next 
Generation data. 

[End of figure] 

Objective 3: Fiscal Year 2006 Contract Obligations: Competed vs. Non-
Competed: 

The percentage of contract obligations competed was highest (68.3%) in 
the fourth quarter. 

Figure: Fiscal Year 2006 Contract Obligations: Competed vs. Non-
Competed: 

[Refer to PDF for image: horizontal bar graph] 

Quarter: Q1; 
Competed: 60.8%; 
Not Competed: 39.2%; 
Total: $66.4 billion. 

Quarter: Q2; 
Competed: 56.4%; 
Not Competed: 43.6%; 
Total: $92.9 billion. 

Quarter: Q3; 
Competed: 63.7%; 
Not Competed: 36.3%; 
Total: $56.6 billion. 

Quarter: Q4; 
Competed: 68.3%; 
Not Competed: 31.7%; 
Total: $82.6 billion. 

Quarter: Total year, 2006; 
Competed: 62.1%; 
Not Competed: 37.9%; 
Total: $298.5 billion. 
			
Source. GAO analysis of Federal Procurement Data System-Next 
Generation data. 

[End of figure] 

Objective 3: Fiscal Year 2007 Contract Obligations: Competed vs. Non-
Competed: 

The percentage of contract obligations competed was highest (68.6%) in 
the fourth quarter. 

Figure: Fiscal Year 2007 Contract Obligations: Competed vs. Non-
Competed: 

[Refer to PDF for image: horizontal bar graph] 

Quarter: Q1; 
Competed: 54.5%; 
Not Competed: 45.5%; 
Total: $99.4 billion. 

Quarter: Q2; 
Competed: 64.7%; 
Not Competed: 35.8%; 
Total: $74.5 billion. 

Quarter: Q3; 
Competed: 65.5%; 
Not Competed: 34.5%; 
Total: $64.9 billion. 

Quarter: Q4; 
Competed: 68.6%; 
Not Competed: 31.4%; 
Total: $90.5 billion. 

Quarter: Total year, 2006; 
Competed: 62.9%; 
Not Competed: 37.1%; 
Total: $329.5 billion. 
			
Source. GAO analysis of Federal Procurement Data System-Next 
Generation data. 

[End of figure] 

Objective 3: Fiscal Year 2008 Contract Obligations: Competed vs. Non-
Competed: 

The percentage of contract obligations competed was highest (65.6%) in 
the fourth quarter. 

Figure: Fiscal Year 2008 Contract Obligations: Competed vs. Non-
Competed: 

[Refer to PDF for image: horizontal bar graph] 

Quarter: Q1; 
Competed: 56.6%; 
Not Competed: 43.4%; 
Total: $88.7 billion. 

Quarter: Q2; 
Competed: 63.6%; 
Not Competed: 36.4%; 
Total: $96.7 billion. 

Quarter: Q3; 
Competed: 63.1%; 
Not Competed: 36.9%; 
Total: $70.0 billion. 

Quarter: Q4; 
Competed: 65.6%; 
Not Competed: 34.4%; 
Total: $122.5 billion. 

Quarter: Total year, 2006; 
Competed: 62.5%; 
Not Competed: 37.5%; 
Total: $377.8 billion. 
			
Source. GAO analysis of Federal Procurement Data System-Next 
Generation data. 

[End of figure] 

Objective 3: Fiscal Year 2009 Contract Obligations: Competed vs. Non-
Competed: 

The percentage of contract obligations competed was highest (72.2%) in 
the fourth quarter. 

Figure: Fiscal Year 2009 Contract Obligations: Competed vs. Non-
Competed: 

[Refer to PDF for image: horizontal bar graph] 

Quarter: Q1; 
Competed: 54.7%; 
Not Competed: 45.2%; 
Total: $104.4 billion. 

Quarter: Q2; 
Competed: 65.7%; 
Not Competed: 34.2%; 
Total: $89.0 billion. 

Quarter: Q3; 
Competed: 66.8%; 
Not Competed: 33.2%; 
Total: $72.2 billion. 

Quarter: Q4; 
Competed: 72.2%; 
Not Competed: 27.8%; 
Total: $114.2 billion. 

Quarter: Total year, 2006; 
Competed: 64.8%; 
Not Competed: 35.1%; 
Total: $379.8 billion. 
			
Source. GAO analysis of Federal Procurement Data System-Next 
Generation data. 

[End of figure] 

Objective 3: Undefinitized Contract Actions (UCAs): 

Available data show that obligations for UCAs are about 5 percent of 
total contract spending: $18 billion in potential obligations out of 
$378 billion in total contract spending in fiscal year 2008. 

Data limitations prevented us from analyzing spending on UCAs by 
quarter. 

As we have previously reported,[A] data limitations also hinder DOD's 
full understanding of the extent to which UCA's are used. For example, 

* Eight of the 24 contract actions that should have been included in a 
required DOD report on UCA's were omitted. 

DOD reporting requirements are still in flux, i.e., DOD has proposed 
including unpriced change orders in UCA reporting. 

[A] Defense Contracting: DOD Has Enhanced Insight into Undefinitized 
Contract Action Use, but Management at Local Commands Needs 
Improvement, GA0-10-299 (Washington, D.C.: Jan. 28, 2010). 

[End of section] 

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