Improvements Needed in Financial Management of GSA's Teleprocessing Services Program

AFMD-83-8: Published: Dec 9, 1982. Publicly Released: Dec 9, 1982.

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GAO reported on the financial management of the General Services Administration's (GSA) Teleprocessing Services Program and considered: (1) how well GSA administers the single billing method used under the schedule contracts; (2) what impact the single billing method has on the Automated Data Processing (ADP) Revolving Fund; and (3) how well user agencies conduct financial accounting, verification, and certification of invoices for teleprocessing services.

GAO found that GSA has not achieved all of its single billing method objectives because it lacks enough staff to review the voluminous monthly invoices it receives for teleprocessing services. As a result, many invoice discrepancies are missed in prepayment reviews and contractors often have interest-free use of Federal funds until the discrepancies are detected in postaudit and the credits for the erroneous payments are received. GAO found that the lag time between GSA payment of contractor invoices and rebilling the user agencies puts the ADP Fund in a reduced cash position for an extended period of time, adversely affecting other programs supported by the fund. In addition, user agencies frequently are late in reimbursing the fund, further straining its cash balances. GAO has helped GSA collect over $4.5 million in delinquent accounts. Unlike most Government procurements which require agency verification of receipt of goods and services before contractor payment, under these multiple award schedule contracts payment is made before verification. However, the required postpayment verification has been less than adequate. GAO found that many teleprocessing services users have not established internal control procedures for verifying invoices as required by regulations. GSA is aware of this problem, but has done little to address it.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: GSA conducted a study to automate the single billing workload but found that a least cost alternative was still too high and that it was not feasible to automate just the billing system. Therefore, the agency canceled addressing the recommendation. However, a larger task has been undertaken to automate the entire multiple awards schedule and include the billing system.

    Recommendation: The Administrator of General Services should develop an alternative, cost effective method, such as an automated system, that would support the single billing workload.

    Agency Affected: General Services Administration

  2. Status: Closed - Implemented

    Comments: GSA designed an automated system called the Combined Billing Generator System to monitor the rebilling of agencies for the Teleprocessing Services Program. It has the capability to bill agencies on a more frequent basis which will reduce the lag time.

    Recommendation: The Administrator of General Services should initiate action to lessen the lag time in rebilling agencies for teleprocessing services and impose penalties for noncompliance with the Teleprocessing Services Program multiple award schedule contract terms.

    Agency Affected: General Services Administration

  3. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Administrator of General Services should issue detailed instructions on the most effective means of verifying Teleprocessing Services Program invoices.

    Agency Affected: General Services Administration

 

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