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Page 1 GAO-04-295R Reliability of Federal Procurement Data

United States General Accounting Office 

Washington, DC 20548 

December 30, 2003 

The Honorable Joshua B. Bolten 

Director, Office of Management and Budget 

Subject: Reliability of Federal Procurement Data 

Dear Mr. Bolten:

The purpose of this letter is to convey our serious and continuing concerns with the 

reliability of the data contained in the Federal Procurement Data System (FPDS) and 

to recommend steps to help improve data reliability as the successor system, FPDSNext Generation (FPDS-NG), is implemented. 

Reliable information is critical to informed decision making and to oversight of the 

procurement system. FPDS has been the federal government’s central database of 

information on federal procurement actions since 1978. Congress and executive 

branch agencies rely on FPDS to assess the impact that governmentwide acquisition 

policies and processes are having on the system generally, as well as with respect to 

specific geographical areas, markets, and socio-economic goals. 

Yet despite the importance of the data, we continue to find that FPDS data are 

inaccurate and incomplete. Although we have not fully assessed the extent of 

reporting errors, we have found sufficient problems to warrant concern about the 

current reliability of FPDS information. We are pleased that the administration is 

moving forward with plans to modernize that system through FPDS-NG. 

The examples following reflect a few of the many instances in which we either have 

been unable to assess fully the implementation of procurement programs or have had 

to limit our reliance on FPDS data: 

• In our 2003 review1

 of the simplified acquisition procedures test program, we 

found gross errors in the FPDS data. For example, use of the test program by 

the reported three largest users in fiscal year 2001 was either overstated or 

understated by millions of dollars. We found similar inaccuracies with the 

Department of Defense’s data system,2

 which feeds information into FPDS. 

 

1

 U.S. General Accounting Office, Contract Management: No Reliable Data to Measure Benefits of the 

Simplified Acquisition Test Program, GAO-03-1068 (Washington D.C.: Sept. 30, 2003).

2

 The Department of Defense uses the Defense Contract Action Data System (DCADS) to supply data 

to FPDS. 
Page 2 GAO-04-295R Reliability of Federal Procurement Data 

Because of the unreliability of the data, we could not determine the extent to 

which executive branch agencies used the test program or assess the benefits 

realized. 

• In our 2001 review3 of the HUBZone program, we found that the value of 

contracts awarded to HUBZone firms could have been hundreds of millions of 

dollars different than reported. The FPDS categorized 1,034 contracts worth 

$325 million as HUBZone awards even though the Small Business 

Administration (SBA) had not certified the awardees of those contracts as 

HUBZone firms. Conversely, FPDS data did not report as HUBZone awards 

1,712 contracts worth $589 million with firms that may have been SBAcertified at time of contract award. Although the Federal Procurement Data 

Center (FPDC) caught some of these inconsistencies through edit checks, 

FPDC officials said that they had neither the knowledge to correct the data nor 

the authority to require agencies to correct them. 

• In our 2003 review of task and delivery orders, 4 we found multiple orders 

reported as single transactions. For instance, an order reported as $11,443,000 

in FPDS should have been reported as 87 separate transactions at or over 

$25,000 and one cumulative transaction for contracts below $25,000. 

As a result of numerous errors in these and other data elements of FPDS, we could 

not determine the extent to which agencies had implemented regulations effectively, 

nor could we assess the impact of acquisition policies governmentwide. 

Our concerns about the reliability of FPDS data are not new. In 1980, we reported 

that FPDS failed to alert users that the system contained known errors. In 1994, we 

reported that the FPDC, which manages FPDS, did not have standards detailing the 

appropriate levels of accuracy and completeness of FPDS data.5

Our work and that of agency inspectors general indicates that many of the errors in 

FPDS are due to data entry mistakes by agency contracting personnel. In some 

cases, those processing the data did not have a complete understanding of the 

information requirements. In other cases, there was inadequate verification of the 

information entered into agency feeder systems, which, in turn, was transferred into 

FPDS. When we discussed these problems with agency officials during the course of 

our reviews, they cited a lack of training, high personnel turnover, the complexity of 

the agency systems, and frequent changes to FPDS data entry requirements as 

reasons for the errors. 

FPDS-NG became operational effective October 1, 2003. As we understand the 

design of the system, FPDS-NG should, if implemented effectively, eliminate many of 

 

3

 U.S. General Accounting Office, Small Business: HUBZone Program Suffers from Reporting and 

Implementation Difficulties, GAO-02-57 (Washington D.C.: Oct. 26, 2001). 

4

 U.S. General Accounting Office, Contract Management: Civilian Agency Compliance with Revised 

Task and Deliver Order Regulations, GAO-03-983 (Washington D.C.: Aug. 29, 2003). 5

 U.S. General Accounting Office, The Federal Procurement Data System—Making It Work Better, 

GAO/ PSAD-80-33 (Washington D.C.: Apr. 18, 1980); and U.S. General Accounting Office, FPDS 

Improvements, GAO/AIMD-94-178R (Washington, D.C.; Aug. 19, 1994). 
Page 3 GAO-04-295R Reliability of Federal Procurement Data 

the sources of the errors in the current FPDS. At the heart of the new system are 

data entry methods that rely less on manual inputs and more on electronic “machineto-machine” approaches. For example, most agencies are expected to have 

computerized contract writing systems that will allow for direct submission of data to 

FPDS. Reliability of data is expected to improve because agency submissions to 

FPDS-NG will be based on data already in the contract writing systems, reducing or 

eliminating separate data entry requirements. The system provides for immediate 

data verification to detect errors. If errors are detected, agency procurement officials 

will have the opportunity to correct them immediately while the information is still 

readily available. 

Information in FPDS-NG can only be as reliable as the information agencies enter 

through their own systems. In the long term, data reliability should improve as 

agencies fund and implement electronic contract writing systems. But not all 

agencies have done so. In the short term, as the transition to FPDS-NG occurs, 

agencies that do not have contract writing systems capable of interfacing directly 

with FPDS-NG need to review their procurement data feeder systems and take steps 

to improve the reliability of the information contained in those systems. 

RECOMMENDATIONS 

We recommend that the Director of OMB: 

 

• Ensure that agencies allocate the resources necessary to implement contract 

writing systems capable of electronic transfer of information to FPDS-NG, 

• Require agencies that have not yet implemented electronic contract writing 

systems to report regularly to OMB on their plans to ensure reliability of the 

information reported to FPDS-NG. 

• Request that major agencies, in consultation with GSA, conduct regular 

reviews of their procedures for collecting and reporting information to FPDSNG. Agencies should conduct such reviews annually until a satisfactory level 

of reliability is achieved, and periodically thereafter. 

AGENCY COMMENTS 

We provided a draft of this letter to the Office of Management and Budget for 

comment. An OMB official commented orally that OMB generally agreed with the 

recommendations. We also sought comments from the General Services 

Administration, which funds and manages the Federal Procurement Data Center. An 

official from GSA told us by email that GSA concurred with the recommendations 

and hoped they would lead to more accurate reporting of procurement information to 

FPDS-NG. 
Page 4 GAO-04-295R Reliability of Federal Procurement Data 

SCOPE AND METHODOLOGY 

The information in this letter is based on previous GAO reviews and additional work 

conducted from June to November 2003, in accordance with generally accepted 

government auditing standards. In conducting that work, we reviewed relevant GAO 

workpapers and GAO and inspector general reports. We also held discussions with 

officials at OMB and GSA and reviewed relevant documents concerning FPDS and 

FPDS-Next Generation. We did not conduct an in-depth review of either FPDS or 

FPDS-NG. 

This letter contains a recommendation to the Director of OMB. The head of a federal 

agency is required under 31 U.S.C. 720 to submit a written statement of actions taken 

on our recommendations to the Senate Committee on Governmental Affairs and the 

House Committee on Government Reform not later than 60 days after the date of this 

letter and to the Senate and House Committees on Appropriations with the agency’s 

first request for appropriations made more than 60 days after the date of this letter. 

We are sending copies of this letter to the Chairs and Ranking Members of the Senate 

Governmental Affairs Committee, the House Government Reform Committee, and 

other interested congressional committees, as well as to the Administrator of General 

Services. We will provide copies to others upon request. This letter also will be 

available on GAO’s home page at http://www.gao.gov. Please contact me at (202) 512-

8214 or Hilary Sullivan at (214) 777-5652 if you or your staff has questions. Major 

contributors to this letter were Robert Ackley, Thomas Barger, William Bricking, 

John Clary, Barbara Johnson, Ronald Salo, and Robert Swierczek. 

Sincerely yours, 

William T. Woods 

Director 

Acquisition and Sourcing Management 

(120261)