ATCH 04-SOO SPECIAL AUDITS

November 3, 2026

STATEMENT OF OBJECTIVES (SOO)

FOR

AIR FORCE SERVICES CENTER (AFSVC)

PUBLIC ACCOUNTANT CONTRACT AUDIT PROGRAM (PACA) SPECIAL

AUDITS

AIR FORCE SERVICES CENTER (AFSVC)

& AIR FORCE INSTALLATIONS

TABLE OF CONTENTS

• SECTION I – DESCRIPTION OF SERVICES

• 1.0 Description of Services

• 1.1 General

• 1.2 Background

• 1.3 Scope

• SECTION II – PROBLEM STATEMENT & OBJECTIVES

• 2.0 Problem Statement

• 2.1 Objectives

• 2.2 Final Outcome & Required Audit Scope

• SECTION III – CONTRACTOR QUALIFICATIONS

• 3.0 Contractor Qualifications

• 3.1 Team Lead / Project Manager

• 3.2 Staff Education

• 3.3 Staff Experience

• 3.4 Audit Standards & Peer Review

• 3.5 Information Security and Data Handling

• 3.6 Subcontracting Prohibition (Mandatory Prime Direct Performance)

• SECTION IV – DELIVERABLES, MILESTONE SCHEDULE, &

ACCEPTANCE CRITERIA

• 4.0 Deliverables, Milestone Schedule, and Acceptance Criteria

• 4.1 Applicability of Deliverables

• 4.2 Financial Statement Audit Deliverables (Base Year & Option Years 1–4)

• 4.3 Performance Audit Deliverables (Base Year & Option Years 1–4)

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• SECTION V – CONTRACT ADMINISTRATION

• 5.0 Contract Administration

• 5.1 Meetings

• 5.2 Communication

• 5.3 Confidentiality

• SECTION VI – GENERAL INFORMATION

• 6.0 General Information

• 6.1 Contracting Officer’s Representative (COR) Responsibilities

• 6.2 Installation Point of Contact (POC) Responsibilities

• 6.3 Place of Performance

• 6.4 Travel

• 6.5 Privacy Act

• 6.6 Security Clearances

• SECTION VII – PERSONNEL SECURITY

• 7.0 Personnel Security

• 7.1 Base Access

• 7.2 Non-Disclosure Agreement

• 7.3 Intellectual Property

• 7.4 Information Security

• 7.5 Personnel Security Compliance

• 7.6 Background Investigation

• SECTION VIII – APPENDIX

• 8.0 Appendix

• 8.1 Definitions & Abbreviations

• 8.2 Sample Weekly Status Report

• 8.3 Sample Contract Progress Report

• 8.4 NAFI Observed Federal Holidays

SECTION I – DESCRIPTION OF SERVICES

1.0 Description of Services

1.1 General

The Air Force Services Center (AFSVC), headquartered at Joint Base San Antonio- Lackland, Texas, delivers Services programs and activities to build and sustain ready and resilient Airmen, Guardians, and families. Air Force Services Center supports bases, major commands (MAJCOMs), and the Air Staff by providing technical expertise, November 3, 2026 launching new initiatives, developing programs and operational procedures, and managing central support functions. Air Force Services Center ensures the successful operation of essential food services, fitness and sports centers, childcare and youth programs, lodging accommodations, and recreational opportunities for military members and their families worldwide.

The Center’s responsibilities include preparing responses to high-level inquiries, providing technical assistance to the field, and developing new programs supporting installation activities. The Financial Management Directorate (VF) centrally manages and administers the Nonappropriated Fund (NAF) Public Accountant Contract Audit (PACA) Program, which supports a worldwide mission providing independent oversight of internal controls, cash management, asset protection, and financial management across the enterprise.

1.2 Background

Nonappropriated Fund (NAF) installations provide support services and activities for military personnel, families, and authorized patrons. Proper management and accountability of Nonappropriated Fund resources are critical to ensuring continued service delivery, operational readiness, and the protection of government interests.

Regular independent audits are required to evaluate the financial condition, control environments, and operational efficiencies of Nonappropriated Fund operations.

The Air Force Services Center Financial Management, Strategic Policy & Financial Operations Branch (AFSVC/VFSF) exercises central program oversight to ensure compliance with annual statutory audit requirements under Department of Defense Instruction (DoDI) 7600.06, Audit of Nonappropriated Fund Instrumentalities and Related Activities, ensuring adequate audit coverage is provided across the enterprise for Nonappropriated Fund Instrumentalities (NAFIs) Services activities.

The term "Activities" refers to operational and revenue-generating entities within the Air Force structure. Audit engagements under this Special Audits contract specifically include financial statement audits and performance audits covering:

• Accounting practices and transactional compliance;

• Internal control environments and segregation of duties;

• Cash management, vault operations, and electronic banking;

• Fixed asset accountability, tracking, and depreciation;

• Inventory valuation, spoilage controls, and physical counts;

• Food and beverage operations and food service portfolios;

• Centralized shared service center processing;

• Venture gaming and electronic slot machine operations;

• Supplemental mission dining operations; and

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• Agreed-upon procedures and special interest compliance reviews.

Specific Focus Areas for the PACA Special Audits Program:

• A. Shared Service Center (SSC): Conduct performance audits of the Shared Service Center (SSC) at the Air Force Services Center (AFSVC) located in San Antonio, TX.

The primary objective of the performance audit is to address economy, efficiency, and operational effectiveness. The scope includes core accounting transaction workflows, inter-entity cost allocation methodologies, compliance with Service Level Agreements (SLAs), operational metrics, and the adequacy of financial management technology system controls. Further details will be outlined in specific delivery order project assignments.

• B. Department of the Air Force (DAF) Venture Gaming Program: The DAF Venture Gaming Program operates electronic gaming and slot machine activities at authorized overseas military installations. The program serves as an important nonappropriated revenue generator utilized directly to support and enhance Morale, Welfare, and Recreation (MWR) programs across all Air Force installations.

Authorized by DoDI 1015.10 and centrally managed by AFSVC in San Antonio, TX, slot machine operations present unique risks due to regulatory complexities, high cash volumes, and potential for manipulation. Scope includes electronic gaming data systems, meter reconciliations, cash drop and count controls, payout authorizations, jackpot disbursements, internal control safeguards against manipulation or theft, and compliance with federal tax reporting requirements (including IRS Form W-2G processing).

• C. Air Force Cadet Dining Fund: The Cadet Dining Fund is a Supplemental Mission Nonappropriated Fund Instrumentality (NAFI) operated by the 10th Force Support Squadron (10th FSS) located at the United States Air Force Academy (USAFA), Colorado. Supplemental Mission NAFIs receive nonappropriated funds generated from installation mission programs (training, food service, education, security). While congressionally appropriated funds (APF) cover civilian management, custodial services, and facility upkeep, nonappropriated funds are utilized strictly for food purchases and the operational maintenance of cadet meal operations. The fund provides daily dining support for over 4,400 cadets. The Contractor shall perform comprehensive financial statement and operational compliance audits examining food supply procurement, inventory receiving and storage controls, cost-per-meal accounting, meal card verifications, and financial statement accuracy in accordance with USAFAI 34-104 and applicable NAF regulations.

• D. Commander’s Special Interest Audits: To address immediate, unplanned operational needs, the Government requires the capacity to execute ad hoc, targeted investigations known as Commander’s Special Interest Audits. These audits may be

November 3, 2026 requested at any given time by Installation Commanders, the AFSVC Commander, or higher headquarters to address immediate operational concerns, suspected material control failures, or strategic risk areas. These ad hoc engagements may encompass any Air Force Installation, NAF Activity, or fund within the scope of this contract, and will be ordered and executed as individual, consolidated performance audit task orders in accordance with the established deliverables and pricing schedules.

1.3 Scope

Air Force Services Center requires the audit services of licensed Certified Public Accountants (CPAs) or CPA firms to perform financial statement audits of Air Force Nonappropriated Fund Instrumentalities (NAFIs) financial statements and performance audits of Nonappropriated Fund Instrumentality (NAFI) Services activities, with particular emphasis on high-risk areas identified through preliminary risk assessments and annual selection matrices.

SECTION II – PROBLEM STATEMENT & OBJECTIVES

2.0 Problem Statement

AFSVC requires objective, professional, and independent public accounting reviews to evaluate whether financial statements fairly reflect operational results, whether internal control environments safeguard nonappropriated assets, and whether specialized programs achieve required operational economy and efficiency.

2.1 Objectives

The primary objectives of this contract are as follows:

• 2.1.1 Comprehensive Audits: Conduct comprehensive audits of financial statements, transactions, and internal controls of Nonappropriated Fund (NAF) Air Force Shared Services Center (SSC), Air Force Venture Gaming, Air Force Cadet Dining, and Commander’s Special Interest Audits. AFSVC is contracting an audit firm for a 5-year ordering period, structured with a base year and four (4) subsequent option years. AFSVC intends to issue initial Base Year task orders requiring dual-year financial statement audits encompassing two distinct historical fiscal years as designated in individual task orders (e.g., FY24 and FY25). While financial statement audits examine specific historical fiscal years, performance audits will be conducted on an as-needed basis with the specific scope defined in individual task orders.

• 2.1.2 Discrepancies & Compliance: Identify discrepancies, inefficiencies, waste, fraud, and non-compliance with relevant governing regulations.

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• 2.1.3 Internal Control Assessment: Assess the adequacy of internal controls within Nonappropriated Fund (NAF) operations, identify weaknesses, and provide practical, actionable recommendations to improve internal controls, financial management, and operational processes.

• 2.1.4 Gaming Operations: Conduct audits of gaming operations (e.g., slot machines) to ensure strict compliance with gaming regulations, cash security, and internal control guardrails.

• 2.1.5 Regulatory Framework: Ensure that Nonappropriated Fund (NAF) activities comply with all applicable Department of Defense, Air Force, and federal policy directives and statutory guidelines.

• 2.1.6 Operational Area Assessments: Conduct comprehensive evaluations across key functional areas:

• 2.1.6.1 Financial Audits: Conduct audits of financial statements, including balance sheets, income statements, and cash flow statements. Review financial transactions for accuracy and compliance with NAF policies. Identify irregularities, fraud, or potential mismanagement of funds, and review transactions in high-risk areas (unapproved disbursements, irregular journal entries, cash flow reports). Perform detailed internal control testing and issue an official audit opinion and Management Letter.

• 2.1.6.2 Performance and Operational Audits: Conduct performance audits in accordance with Government Auditing Standards (GAGAS) to assess whether NAF activities are achieving economy, efficiency, and effectiveness. Evaluate operational processes, resource allocation, staffing levels, and service delivery methods. Conduct root-cause analyses and issue final performance audit reports with actionable recommendations.

• 2.1.6.3 Internal Control Evaluations: Evaluate the design and operational effectiveness of internal controls established to safeguard NAF assets and prevent fraud, waste, and abuse. Focus on segregation of duties, management approval thresholds, physical security over inventory and cash vaults, and logical system access rights.

• 2.1.6.4 Compliance Reviews: Evaluate adherence to Department of Defense instructions, local policies, and applicable financial regulations (including DoD 7000.14-R, AFMAN 34-209, and program-specific manuals).

• 2.1.6.5 Reporting: Prepare detailed, evidence-based audit reports providing clear, actionable insights. Quantify operational and financial impacts, identify root causes, and present risk-mitigation strategies.

• 2.1.6.6 Technology Systems: As part of the general financial and performance audit scope (and not as a standalone IT audit), evaluate the effectiveness and efficiency of utilized IT resources, focusing on logical access security, physical

November 3, 2026 server controls, POS system controls, data backup/recovery, and emergency contingency procedures.

• 2.1.6.7 Prior Audit Resolution: Review prior PACA reports to independently verify whether previously identified weaknesses and recommendations have been remediated and closed. Document the status of prior findings and explicitly highlight recurring or unmitigated "repeat findings."

2.2 Final Outcome & Required Audit Scope

• 2.2.1 Regulatory Mandates: The Contractor shall verify compliance with Air Force Instruction 65-301 (Audit Reporting Procedures), Air Force Instruction 65-403 (Follow-up on Internal Air Force Audit Reports), DoDI 7600.06 (Audit of Nonappropriated Fund Instrumentalities and Related Activities), GAGAS (Comptroller General Yellow Book), GAAS, DoD 7000.14-R (DoD Financial Management Regulation), DAFMAN 34-201 (Use of Nonappropriated Funds), DAFI 34-101 (MWR Programs and Use Eligibility), DAFMAN 34-151 (Gaming Operating Procedures), USAFAI 34-104 (Operating the Cadet Dining Facility), AFMAN 34- 209 (NAF Financial Management and Accounting), and AFMAN 34-202 (Procedures for Protecting Nonappropriated Funds Assets). Ensure all gaming and payroll tax reporting mandates (e.g., IRS Form W-2G) are met.

• 2.2.2 Independent Professional Judgment: This document is not intended to be a comprehensive manual of audit procedures, nor is it intended to replace the auditor’s professional judgment as to the work required to accomplish audit objectives. The Contractor shall provide all labor, management, tools, and supervision.

• 2.2.3 Audit Opinion: Express an independent opinion on whether the financial statements fairly present the financial position, operational results, and cash flows in conformity with GAAP/GAGAS.

• 2.2.4 Compliance Opinion: Express formal conclusions on compliance with statutory mandates and directives having a material effect on financial presentations.

• 2.2.5 Evidence Gathering: Gather sufficient, appropriate audit evidence to obtain reasonable assurance for expressed opinions.

• 2.2.6 General IT Controls: Review general controls surrounding financial data processing systems to determine whether controls meet legal mandates and operate effectively to ensure data reliability and security.

• 2.2.7 Working Capital & Investments: Determine whether cash management and short-term investments align with sound working capital guidelines and regulations.

• 2.2.8 Asset Safeguarding: Determine whether cash, vaults, bank accounts, and physical assets are properly controlled and safeguarded.

• 2.2.9 Related-Party Transactions: Evaluate related-party transactions and fund interrelationships.

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• 2.2.10 Transaction Classification: Ensure proper accounting treatment and classification of assets, liabilities, revenues, and expenses.

• 2.2.11 Revenue Controls: Verify accurate recording and adequate internal controls over revenues and receivables.

• 2.2.12 Expense Reasonableness: Verify that expenses are properly supported, approved, and reasonable compared to budgets and historical periods.

• 2.2.13 Fixed Asset Depreciation: Verify physical existence, valuation, tagging, and depreciation reasonableness for fixed capital assets.

• 2.2.14 Liabilities & Equity: Verify complete recording of liabilities and proper presentation of equity accounts.

• 2.2.15 Inventory Controls: Verify physical inventory counts, inventory valuations, and spoilage/loss controls.

• 2.2.16 Contracts & Agreements: Review procurement contracts and vendor agreements to confirm goods/services received align with payments made under contract terms.

• 2.2.17 Internal Control Structure: Assess overall reliance on the internal control environment to safeguard nonappropriated assets.

SECTION III – CONTRACTOR QUALIFICATIONS

3.0 Contractor Qualifications

The Contractor must provide a team of qualified personnel possessing the collective professional expertise, education, and security capabilities required to successfully execute the objectives outlined in this Statement of Objectives (SOO).

3.1 Team Lead / Project Manager

The Team Lead must be a licensed Certified Public Accountant (CPA) in good standing with a state board of accountancy, possessing a minimum of six (6) years of public accounting audit experience. This experience must include conducting financial statement, performance, and compliance audits for activities similar in nature to Air Force Nonappropriated Fund Instrumentalities (NAFIs) (e.g., food and beverage, hospitality, recreation, retail, shared service operations, or government entities).

3.2 Staff Education

All professional staff assigned to perform audit procedures must possess, at a minimum, a Bachelor’s degree in Accounting, Finance, or Business Administration from an accredited institution, to include at least twenty-four (24) semester credit hours in accounting coursework.

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3.3 Staff Experience

Audit staff assigned to the contract must possess a minimum of two (2) years of professional audit experience. Collectively, the audit team must demonstrate experience auditing hospitality, retail, recreation, or service-industry operations similar to those described in this SOO.

3.4 Audit Standards & Peer Review

The contracting firm must be a licensed Certified Public Accountant (CPA) firm in good standing with its respective State Board of Accountancy. The firm must have received a rating of "Pass" on its most recent independent external peer review conducted under Generally Accepted Government Auditing Standards (GAGAS / Yellow Book).

3.5 Information Security and Data Handling

The Contractor shall utilize a secure, DoD-compliant file repository and data transfer protocol capable of securing Controlled Unclassified Information (CUI) and Personally Identifiable Information (PII) in compliance with NIST SP 800-171 standards.

3.6 Subcontracting Prohibition (Mandatory Prime Direct Performance)

SUBCONTRACTING, TEAMING ARRANGEMENTS, JOINT VENTURES, AND

THE ENGAGEMENT OF INDEPENDENT 1099 CONSULTANTS ARE STRICTLY

PROHIBITED UNDER THIS CONTRACT.

• All audit planning, on-site fieldwork, sampling, testing, managerial review, out-briefings, and report writing must be executed exclusively by direct, bona fide W-2 employees of the Prime CPA firm.

• Proposals containing subcontractor arrangements, third-party labor, or teaming partners shall be rated Technically Unacceptable and eliminated from award consideration.

• Any violation of this requirement during contract performance shall constitute a material breach of contract, resulting in immediate termination for default/cause without NAFI liability.

SECTION IV – DELIVERABLES, MILESTONE SCHEDULE, & ACCEPTANCE

CRITERIA

4.0 Deliverables, Milestone Schedule, and Acceptance Criteria

The Contractor will provide deliverables in formats fully compatible with Microsoft Office and Adobe Acrobat Pro (.pdf). All reports will be provided in electronic file

November 3, 2026 format in addition to one bound hard copy of the final audit report delivered to the audited activity POC and the AFSVC COR.

All deliverables must receive written approval from the Contracting Officer’s Representative (COR) and designated AFSVC representative prior to acceptance and invoice authorization. A comprehensive audit plan outlining methodology, approach, and timeline will be submitted prior to beginning any audit engagement. Regular and recurring updates on audit progress, findings, and issues will be provided. The preliminary draft report will outline initial findings, recommendations, and management concerns. The final audit report will incorporate verified management feedback and present complete findings, recommendations, and conclusions. Formal in-brief and out-brief presentations will be afforded to audited activity leadership.

4.1 Applicability of Deliverables

The deliverables outlined below apply to both Financial Statement Audits and Performance Audits across all ordering periods:

• 4.1.1 Financial Statement Audits: Each individual deliverable bundle applies to an individual fund audit engagement.

• 4.1.2 Performance Audits: Each individual deliverable bundle applies to a consolidated audit engagement encompassing designated activities on an installation during a single site visit.

4.2 Financial Statement Audit Deliverables (Base Year & Option Years 1–4)

(Auditing Designated Historical Fiscal Year(s), up to a Dual-Year, as defined in individual Task/Delivery Orders)

4.2.1 Audit Plan & Project Schedule

• 4.2.1.1 Audit Plan: Within ten (10) business days following the formal kick-off meeting, the Contractor shall provide a detailed audit plan. The plan shall include a preliminary itinerary with approximate fieldwork dates, a list of audit team members (indicating the on-site team lead for each location), and any projected blackout dates.

Fieldwork duration shall not exceed four (4) weeks per engagement and will be performed during regular operating hours of the audited activity. The plan must detail the nature, timing, and extent of substantive and analytical procedures, communication channels, and report delivery schedules. Fieldwork must be performed at the respective sites where records are maintained.

• 4.2.1.2 Detailed Project Plan: The Contractor shall provide a realistic, detailed master project work breakdown structure outlining tasks and subtasks for both the Air

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Force and the Contractor. Once approved by the COR, delivery must follow the approved schedule.

• 4.2.1.3 Delay Reporting: All forecasted or unexpected schedule delays must be reported to the COR in writing within one (1) business day of discovery, including reasons for the delay and proposed corrective actions submitted no later than 1600 Central Standard Time (CST) the same day.

• 4.2.1.4 Contractor Error Delays: If a delay results from Contractor error or staffing issues, the Contractor shall submit a revised operational schedule to the COR for review and approval within two (2) workdays of discovery.

4.2.2 Provided by Client (PBC) List and Audit In-Brief

The Contractor shall submit the initial Provided by Client (PBC) document request list to designated installation Points of Contact (POCs) no later than fifteen (15) calendar days prior to arriving on-site. On the first day of on-site fieldwork, the Contractor shall conduct a formal on-site In-Brief meeting with installation leadership and designated POCs outlining the audit scope, methodology, schedule, communication plan, and status of PBC requests. Fieldwork begins on the day of or the business day immediately following the In-Brief.

4.2.3 Audit Out-Brief

All on-site fieldwork must be fully completed within four (4) weeks of the In-Brief. On the final day of on-site fieldwork, the Contractor shall conduct a formal on-site Out-Brief meeting with installation leadership and designated POCs. The briefing will present preliminary findings, identify high-risk vulnerabilities, and ensure mutual understanding of initial outcomes prior to the team departing the installation.

4.2.4 Preliminary Draft Audit Report

Within four (4) weeks of the completion of on-site fieldwork, the Contractor shall submit a Preliminary Draft Audit Report to the COR and audited activity POC. The package must include the draft Independent Auditor’s Report, proposed financial adjustments, and a preliminary Management Letter detailing initial internal control findings. Submission initiates a thirty (30) calendar day management review and comment cycle.

4.2.5 Formal Draft Audit Report

Within ten (10) business days of receiving the government’s written review comments on the preliminary draft, the Contractor shall submit a Formal Draft Financial Audit Report.

This report will incorporate accepted management feedback, resolve proposed adjustments, and include the updated draft Independent Auditor’s Report and updated Management Letter.

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4.2.6 Final Audit Report Package

Within ten (10) business days of receiving final government approval of the draft, the Contractor shall issue the finalized audit report package. The package must include the signed, dated Independent Auditor’s Report (audit opinion) bound to the audited comparative financial statements and footnotes, along with the final Management Letter detailing identified internal control deficiencies.

4.2.7 Progress and Summary Reports

• 4.2.7.1 Weekly Status Reports: Submit weekly status reports (IAW Appendix 8.2 format) detailing completed milestones, percentage completion of active tasks, upcoming planned activities, and identified project risks.

• 4.2.7.2 Monthly Contract Progress Reports: Submit monthly contract progress reports with monthly invoices (IAW Appendix 8.3 format), consistent with submitted and COR-approved weekly status reports.

• 4.2.7.3 Monthly Interim Summary Reports: Provide a monthly summary progress report containing an executive summary of audit findings and a cross-feed matrix reporting systemic weaknesses and recurring deficiencies across audited entities.

4.3 Performance Audit Deliverables (Base Year & Option Years 1–4)

(Performance Audits: Ordered As-Needed across Base and Option Periods)

4.3.1 Audit Plan & Performance Project Schedule

• 4.3.1.1 Performance Audit Plan: Within ten (10) business days of the kick-off meeting, the Contractor shall provide a detailed audit plan including preliminary itinerary, approximate fieldwork dates, audit team roster (designating the on-site lead), and projected resource availability. Fieldwork will not exceed four (4) weeks and must be performed during regular operating hours at the location where the audited records and activities operate. The plan must detail the nature, timing, and extent of analytical, observational, and interview procedures.

• 4.3.1.2 Detailed Project Plan: The Contractor shall provide a realistic, detailed master project work breakdown structure outlining tasks and subtasks for both the Air Force and the Contractor. Once approved by the COR, delivery must follow the approved schedule.

• 4.3.1.3 Delay Reporting: Forecasted or unexpected delays must be reported to the COR in writing within one (1) business day of discovery, with written causes and proposed solutions submitted NLT 1600 CST the same day.

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• 4.3.1.4 Contractor Error Delays: Delays resulting from Contractor error require submission of a revised recovery schedule to the COR within two (2) workdays for review and approval.

4.3.2 PBC List and Performance Audit In-Brief

Submit the initial PBC document request list to designated installation POCs no later than fifteen (15) calendar days prior to arriving on-site. Prepare and conduct a formal on-site In-Brief meeting with installation leadership ,activity managers, and designated POCs outlining audit scope, evaluation methodology, communication channels, and document fulfillment status. Fieldwork begins on the business day immediately following the In- Brief.

4.3.3 Performance Audit Out-Brief

All on-site fieldwork must be fully completed within four (4) weeks of the In-Brief. On the final day of fieldwork, conduct a formal on-site Out-Brief meeting with installation leadership and POCs presenting preliminary findings, immediate operational risks, and initial recommendations prior to departing the installation.

4.3.4 Preliminary Draft Performance Audit Report

Within four (4) weeks of fieldwork completion, submit a Preliminary Draft Performance Audit Report to the COR and installation POC outlining preliminary operational findings, non-compliance issues, and initial control gaps. Initiates the thirty (30) calendar day management review and comment cycle.

4.3.5 Formal Draft Performance Audit Report

Within ten (10) business days of receiving government review comments, submit a Formal Draft Performance Audit Report incorporating accepted management feedback, clearly articulating findings, root-cause analyses, quantified impacts, and actionable recommendations to optimize resources and operational performance.

4.3.6 Final Performance Audit Report

Within ten (10) business days of approved draft report acceptance, issue the Final Performance Audit Report containing a detailed breakdown of operational findings, root causes, quantified financial/operational impacts, and specific recommendations to improve economy, efficiency, and program effectiveness.

4.3.7 Progress and Summary Reports

• 4.3.7.1 Weekly Status Reports: Submit weekly status reports (IAW Appendix 8.2) detailing completed tasks, task completion percentages, upcoming tasks, and project risks.

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• 4.3.7.2 Monthly Contract Progress Reports: Submit monthly progress reports with invoices (IAW Appendix 8.3), matching COR-approved weekly reporting.

• 4.3.7.3 Monthly Interim Summary Reports: Provide a monthly summary report with an executive summary and cross-feed matrix detailing systemic operational weaknesses and efficiency trends.

SECTION V – CONTRACT ADMINISTRATION

5.0 Contract Administration

5.1 Meetings

• 5.1.1 Kick-Off Meeting: A formal kick-off meeting will be held virtually (via Microsoft Teams) or in person at Air Force Services Center on a date and time mutually agreed upon no later than fifteen (15) business days after contract award.

The Contractor will designate a primary POC and identify the Team Lead. The kick-off will cover statement of work requirements, project timeline, audit approach, scope, and stakeholder expectations. The Team Lead will remain available for consultation with the COR during normal duty hours on an as-needed basis.

• 5.1.2 Entrance and Exit Briefs: Once audits are assigned and schedules approved, the Contractor will coordinate with designated government POCs to schedule and conduct formal on-site Entrance (In-Brief) and Exit (Out-Brief) briefings at the respective activity being audited.

• 5.1.3 Status Meetings: The frequency, duration, and format of status meetings will be determined collaboratively by the COR and Contractor after contract award.

5.2 Communication

• 5.2.1 COR Inclusion: The Contracting Officer’s Representative (COR) will be included in all communications, including meetings, briefings, teleconferences, and email correspondence.

• 5.2.2 Contracting Office Authority: The Contracting Office will be included in all issues and questions related to delivery, deliverables, scope, and price.

5.3 Confidentiality

All information obtained during audit engagements will be treated as strictly confidential and will not be disclosed to any third party without prior written consent from the Contracting Office.

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SECTION VI – GENERAL INFORMATION

6.0 General Information

6.1 Contracting Officer’s Representative (COR) Responsibilities

• 6.1.1 Designation: The COR is appointed in writing by the Contracting Officer to perform specific technical and administrative functions. The COR is NOT authorized to make commitments or changes affecting price, quality, quantity, delivery, or other terms and conditions.

• 6.1.2 Appointment: The Contracting Officer designates the individual serving as the

COR.

• 6.1.3 Administration: The COR is responsible for administering technical performance. In no event will understandings, agreements, change orders, or deviations be binding unless formalized in writing by the Contracting Officer prior to contract completion.

• 6.1.4 Term of Appointment: The COR designation remains effective for the life of the contract unless terminated sooner in writing or due to reassignment.

• 6.1.5 Primary Duties: The COR performs post-award administration, maintains deliverable tracking records and acceptance statuses, archives transmittal correspondence, provides baseline prior audit information to contractors, and processes invoice receiving reports.

• 6.1.6 Vacancy: If the COR vacates the position or is absent, designated AFSVC team members may correspond on invoicing and travel matters.

• 6.1.7 Surveillance & Inspections: The COR verifies technical contract compliance, conducts inspections of deliverables, maintains liaison with the Contractor and Functional Program Manager, initiates gatekeeper coordination for base POC appointment, processes travel order requests, and performs unannounced periodic site visits to monitor performance. Deficiencies will be recorded in Monthly Activity Reports.

6.2 Installation Point of Contact (POC) Responsibilities

• 6.2.1 PBC Coordination: Upon receipt of the PBC list (15 calendar days prior to fieldwork), the installation POC makes every reasonable effort to provide requested files on or before Day One of the In-Brief.

• 6.2.2 Briefing Arrangements: The POC coordinates and schedules on-site In-Brief and Out-Brief meetings with FSS Commanders, Resource Managers, Financial Analysts (NAFFA), and relevant activity managers.

• 6.2.3 On-Site Logistics: The POC assists with on-base lodging reservations, base passes, desk/workspaces, telephone access (DSN and commercial), and standard internet connectivity.

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• 6.2.4 Liaison: The POC maintains direct contact with the COR and the Contractor’s on-site team lead.

• 6.2.5 Deliverable Review: The POC participates in deliverable review. The POC and audited activity leadership have thirty (30) calendar days to compile official management responses to the Preliminary Draft Report, and ten (10) business days following Formal Draft submission to verify comment integration.

• 6.2.6 Performance Monitoring: The POC monitors daily on-site performance and reports any incidents of non-conformance, conduct issues, or delays directly to the

COR.

6.3 Place of Performance

All audit fieldwork, entrance briefings, and exit briefings will be conducted on-site at the respective installation or activity being audited. On-site fieldwork will not exceed a maximum duration of four (4) weeks per audit. Remote work is authorized only for audit preparation, data analysis, and report drafting at the Contractor’s office facilities.

6.4 Travel

All travel must be mutually coordinated and reimbursed by Air Force Services Center in accordance with the Federal Travel Regulations (FTR) and Clause 29 of the NAF Standard Clauses.

6.5 Privacy Act

The Contractor shall safeguard and comply with all agency rules and regulations issued under Public Law 110-53 (42 U.S.C. § 2000ee-1) Section 803; AFPD 33-3; DoDD 5400.11; DoD 5400.11-R; DoDI 5400.16; DoDI 1000.30; DoDI 1000.29; Privacy Act of 1974 (5 U.S.C. § 552a); E-Government Act of 2002 (44 U.S.C. § 3601); and AFI 33-332.

Penalties and civil remedies apply for unauthorized disclosure or misuse of Personally Identifiable Information (PII).

6.6 Security Clearances

• 6.6.1 Cybersecurity Compliance: Personnel requiring access to AFSVC information systems or data must maintain current cybersecurity qualifications in accordance with DoDM 8140.03.

• 6.6.2 Clearance Guardrails: Comply with DoDI 5200.02, AFMAN 16-1405, AFM 33-152, DoDD 8500.01, AFI 17-130, and DoDM 8140.03. Contractor personnel shall NOT be assigned duties within IAT-II or IAT-III requiring "Limited Privileged Access" (such as system or database administration rights) to any NAFI application or network.

• 6.6.3 Background Investigations: Tier 1 requests use SF 85; Tier 3 requests use SF 86, routed through the installation Information Protection Office and verified via the

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Defense Information System for Security (DISS). All CAC holders must have favorable FBI fingerprint checks.

• 6.6.4 System Access Adjudication: Personnel requiring system access must be adjudicated with a Favorable determination in DISS and execute a non-disclosure agreement.

• 6.6.5 Security Inquiries: Contractor personnel must respond to AFSVC Security Manager inquiries within three (3) business days (not to exceed 72 hours). Non-response constitutes grounds for termination.

SECTION VII – PERSONNEL SECURITY

7.0 Personnel Security

7.1 Base Access

The Contractor shall obtain installation entry and vehicle passes for all personnel visiting or performing work on Air Force installations.

• 7.1.1 REAL ID Compliance: A "Wants and Warrants" check is conducted for every visitor before passes are issued. In accordance with the REAL ID Act of 2005 and DoDM 5200.08 Vol 3, federal installations require visitors seeking base access to present a REAL ID-compliant credential bearing DHS star markings or enhanced designations. Unmarked state licenses are not accepted.

• 7.1.2 DBIDS Registration: Contractor personnel will report to the Visitor Reception Center on start date of work to obtain Defense Biometric Identification System (DBIDS) passes. Badges will be signed out on AF Form 1297 and returned to the COR or base POC upon contract completion.

7.2 Non-Disclosure Agreement

Prior to commencement of work, Contractor personnel will execute standard Non- Disclosure Agreements (NDAs).

7.3 Intellectual Property

All materials, working papers, spreadsheets, and reports generated using Air Force information are the exclusive property of the Air Force. Information will not be shared with third parties.

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7.4 Information Security

The Contractor will protect all unclassified Air Force information in accordance with DoDI 8582.01, Security of Unclassified Department of Defense (DoD) Information on Non-DoD Information Systems.

7.5 Personnel Security Compliance

Comply with DoDM 5200.02 (DoD Personnel Security Program) and AFI 31-501 (Personnel Security Program Management).

7.6 Background Investigation

Contractor personnel are subject to background investigations based on assigned duties and will in-process with the AFSVC Security Manager prior to performance.

SECTION VIII – APPENDICES

8.0 Appendix

8.1 Definitions & Abbreviations

• CO: Contracting Officer. The duly appointed Government agent authorized to enter into, administer, or terminate contracts and legally obligate the NAFI.

• COR: Contracting Officer’s Representative. Designated in writing to monitor technical performance.

• SOO: Statement of Objectives.

• AF: Air Force

• AFSVC: Air Force Services Center

• AFMAN: Air Force Manual

• AFI: Air Force Instruction

• APF: Appropriated Funds

• DAFMAN: Department of the Air Force Manual

• DAFI: Department of the Air Force Instruction

• DoD: Department of Defense

• DoDI: Department of Defense Instruction

• FSS: Force Support Squadron

• MWR: Morale, Welfare, and Recreation

• NAF: Nonappropriated Funds

• NAFI: Nonappropriated Fund Instrumentality

• SSC: Shared Service Center

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• USAFAI: United States Air Force Academy Instruction

8.2 Sample Weekly Status Report

(Format to be submitted weekly by Prime Contractor Team Lead)

Action Items Status (Not Started, In Progress, Complete)

Start Date Finish Date Notes / Details

Deliverable 1 Tasks

Task 1.1: PBC Document Review

Task 1.2:

Entrance Conference Prep

Deliverable 2

Task 2.1: On- Site Fieldwork Execution

Task 2.2:

Substantive Sample Testing

Deliverable 3

Task 3.1: Draft Management Letter Drafting

Additional Work Items This Week: 1. 2.

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Work Planned for Upcoming Week: 1. 2.

Other Issues / Concerns / Identified Risks / Resolutions: 1. 2.

Tentative Schedule / Staff Vacation / Off Days: 1. 2.

8.3 Sample Contract Progress Report

(Submitted monthly with invoice)

CONTRACT PROGRESS REPORT

• Contractor Name: __________________________________

• Contract / NPA Number: ___________________________

• Invoice Number: __________________________________

• Period Covered: From: ____________ To: ____________

• Completion Date: _________________________________

Line No. Work Element / Milestone

% of Total Job

% Completed This Period

% Completed Cumulative

0001 Milestone 1:

Audit Plan & In-Brief

15%

0002 Milestone 2:

Fieldwork & Out-Brief

35%

0003 Milestone 3:

Preliminary Draft Report

15%

0004 Milestone 4:

Formal Draft Report

15%

0005 Milestone 5:

Final Report & Closeout

20%

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At the Contracting Officer's discretion and according to the payments clause of the contract, the information provided on this form may be used for computing progress payments.

PROGRESS OR COMPLETION CERTIFICATE

I hereby certify that we have satisfactorily completed the indicated percentage of the contract per contract specifications.

• Submitted by (Contractor Certification):

• Name and Title: _____________________________________

• Signature: _______________________ Date: _____________

• Reviewed by Contracting Officer’s Representative (COR):

• Performance: [ ] HAS [ ] HAS NOT satisfactorily completed the indicated percentages of the contract as stated above.

• Remarks: ___________________________________________

• Name and Title: _____________________________________

• Signature: _______________________ Date: _____________

8.4 NAFI Observed Federal Holidays

The Contractor shall observe all official federal holidays established by federal law:

Observed Federal Holiday

New Year’s Day

Birthday of Martin Luther King, Jr.

Washington’s Birthday (Presidents' Day)

Memorial Day

Juneteenth National Independence Day

Independence Day

Labor Day

Columbus Day

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Veterans Day

Thanksgiving Day

Christmas Day

(Any other day specifically designated by Federal Statute or Executive Order)