Contract overpayments not a problem at NASA, audit finds

NASA is doing a good job of preventing overpayments to its contractors, according to a new audit by the General Accounting Office.

In a survey of 110 NASA contracts and purchase orders, GAO found only one case where the agency overpaid a contractor. An automated system and multiple reviews by NASA and the Defense Contract Audit Agency help catch any payment errors, according to the report.

Rep. Dan Burton, R-Ind., requested the GAO review (02-642R).

Despite NASA's system for catching payment errors, improper payments can still occur through human error and weaknesses in contractors' accounting systems. In one case not included in GAO's formal review, a contractor overcharged NASA by $47 million on a monthly invoice. The contractor notified NASA of its mistake when it received the inflated bill and adjusted later invoices to reflect the overpayment.

Improper payments have been a longstanding problem for many federal agencies. In 1999, GAO found that twelve agencies had overpaid their contractors by more than $20 billion, a finding that prompted Sen. Fred Thompson, R-Tenn., to introduce legislation requiring agencies to use recovery auditing methods to identify misspent funds. A related provision became law in the fiscal 2002 Defense Authorization Act.

Recovery auditing, used widely in the private sector, uses computer software programs to analyze agency contract and payment information to root out discrepancies in data, such as duplicate payments, uncollected rebates and unauthorized expenditures. Agencies are also forming data-sharing arrangements with vendors, states and other federal agencies to identify improper payments that have already been made.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
Close [ x ] More from GovExec

Thank you for subscribing to newsletters from
We think these reports might interest you:

  • Forecasting Cloud's Future

    Conversations with Federal, State, and Local Technology Leaders on Cloud-Driven Digital Transformation

  • The Big Data Campaign Trail

    With everyone so focused on security following recent breaches at federal, state and local government and education institutions, there has been little emphasis on the need for better operations. This report breaks down some of the biggest operational challenges in IT management and provides insight into how agencies and leaders can successfully solve some of the biggest lingering government IT issues.

  • Communicating Innovation in Federal Government

    Federal Government spending on ‘obsolete technology’ continues to increase. Supporting the twin pillars of improved digital service delivery for citizens on the one hand, and the increasingly optimized and flexible working practices for federal employees on the other, are neither easy nor inexpensive tasks. This whitepaper explores how federal agencies can leverage the value of existing agency technology assets while offering IT leaders the ability to implement the kind of employee productivity, citizen service improvements and security demanded by federal oversight.

  • IT Transformation Trends: Flash Storage as a Strategic IT Asset

    MIT Technology Review: Flash Storage As a Strategic IT Asset For the first time in decades, IT leaders now consider all-flash storage as a strategic IT asset. IT has become a new operating model that enables self-service with high performance, density and resiliency. It also offers the self-service agility of the public cloud combined with the security, performance, and cost-effectiveness of a private cloud. Download this MIT Technology Review paper to learn more about how all-flash storage is transforming the data center.

  • Ongoing Efforts in Veterans Health Care Modernization

    This report discusses the current state of veterans health care


When you download a report, your information may be shared with the underwriters of that document.