Friday, November 18, 2011

GAO To NASA: Strengthen Your Controls On Commercial Space Contracts

According to a Government Accounting Office report released yesterday:

"In recent years, NASA has for the first time used its other transaction authority to help fund development of large-scale commercial space transportation systems. 

In light of this unprecedented use and the fact that these agreements are not subject to many of the laws that apply to traditional contracts executed under the FAR, it is important that NASA ensure this authority is used and managed appropriately. 

Internal controls are a key element of effective management and help to facilitate good program outcomes and foster accountability. NASA’s policies provide for such controls regarding separation of duties and delegation of authority, as well as for conducting risk assessments associated with the decision to use funded Space Act agreements. 

However, there are no documentation requirements associated with these assessments. Although NASA considers its strategic acquisition framework and related policies the mechanism by which additional risks are considered when use of a funded Space Act agreement is being considered among a range of instruments, it is not clear from this framework and accompanying policies if, how, or the extent to which they apply in such cases. 

As a result, it may be difficult for NASA to ensure these policies are appropriately followed for future efforts that contemplate the use of a funded Space Act agreement along with other instrument types. 

Additionally, while a formal process is now in place for administering NASA’s commercial crew effort, the agency does not require or offer training specific to the use of funded Space Act agreements. 

This could affect NASA’s ability to ensure this authority is used appropriately and effectively. "

In response, NASA indicated that the agency has plans to take actions to address the issues raised by the GAO. 

For example, NASA stated to the GAO that it will update its guidance to ensure a written determination on the proposed use of funded Space Act agreements, including appropriate analysis supporting the determination, is required prior to the initiation of any funded Space Act Agreement activities.