OIG - SAQMPD08R0247 - 2nd Revision.pdf

SOLICITATION, OFFER, AND AWARD

1. THIS CONTRACT IS A RATED ORDER UNDER DPAS (15 CFR

700)

RATING

2. CONTRACT NUMBER 3. SOLICITATION NUMBER

SAQMMA08R0247 SEALED BID (IFB)

X NEGOTIATED (RFP)

4. TYPE OF SOLICITATION 5. DATE ISSUED

05/28/2008

6. REQUISITION/PURCHASE NUMBER

CODE: LMAQM

OFFICE OF ACQUISITION MANAGEMENT (A/LM/AQM)

PO BOX 9115, ROSSLYN STATION

US DEPARTMENT OF STATE

ARLINGTON, VA 22219

7. ISSUED BY

OFFICE OF ACQUISITION MANAGEMENT (A/LM/AQM)

PO BOX 9115, ROSSLYN STATION

US DEPARTMENT OF STATE

ARLINGTON, VA 22219

8. ADDRESS OFFER TO (If other than Item 7)

NOTE: In sealed bid solicitations "offer" and "offeror" mean "bid" and "bidder".

SOLICITATION

CAUTION - LATE Submissions, Modifications, and Withdrawals: See Section L, Provision No. 52.214-7 or 52.215-1. All offers are subject to all terms and conditions contained in this solicitation.

9. Sealed offers in original and ____ copies for furnishing the supplies or services in the Schedule will be received at the place specified in item 8, or if handcarried, in the depository located in ____ until

____ local time ____

10. FOR

INFORMATION

E-MAIL:

A. NAME

Frederick Washington 703-875-4985

B. TELEPHONE (NO COLLECT

CALLS)

C. E-MAIL ADDRESS

WashingtonFJ@state.gov

11. TABLE OF CONTENTS (See Table of Contents on page 2)

(X) SEC. DESCRIPTION PAGE(S) (X) SEC. DESCRIPTION PAGE(S)

PART I - SCHEDULE PART II - CONTRACT CLAUSES

X A SOLICITATION/CONTRACT FORM 1-4 X I CONTRACT CLAUSES 51-62

X B SUPPLIES OR SERVICES AND PRICES/COSTS 5-13 PART III - LIST OF DOCUMENTS, EXHIBITS AND OTHER ATTACHMENTS

X C DESCRIPTION/SPECS./WORK STATEMENT 14-28 X J LIST OF ATTACHMENTS 63

X D PACKAGING AND MARKING 29 PART IV - REPRESENTATIONS AND INSTRUCTIONS

X E INSPECTION AND ACCEPTANCE 30 X K REPRESENTATIONS CERTIFICATIONS AND OTHER

STATEMENTS OF OFFERORS

64-68

X F DELIVERIES OR PERFORMANCE 31-40

X L INSTRS., CONDS., AND NOTICES TO OFFERORS 69-78X G CONTRACT ADMINISTRATION DATA 41-44

X M EVALUATION FACTORS FOR AWARD 79-82X H SPECIAL CONTRACT REQUIREMENTS 45-50

OFFER (Must be fully completed by offeror)

NOTE: Item 12 does not apply if the solicitation includes the provisions at 52.214-16, Minimum Bid Acceptance Period.

In compliance with the above, the undersigned agrees, if this offer is accepted within __________ calendar days (60 calendar days unless a different period is inserted by the offeror) from the date for receipt of offers specified above, to furnish any or all items upon which prices are offered at the price set opposite each item, delivered at the designated point(s), within the time specified in the schedule.

12.

13. DISCOUNT FOR PROMPT PAYMENT (See Section I, Clause No.

52.232-8)

10 CALENDER DAYS(%)

0.00 %

20 CALENDER DAYS(%)

0.00 %

30 CALENDER DAYS(%)

0.00 %

0 CALENDER DAYS(%)

0.00 %

14. ACKNOWLEDGEMENT OF AMENDMENTS (The offeror acknowledges receipt of amendments to the SOLICITATION for offerors and related documents numbered and dated):

AMENDMENT NO. DATE AMENDMENT NO. DATE

15A. NAME AND

ADDRESS OF

OFFEROR

CONTACT: DUNS: 16. NAME AND TITLE OF PERSON AUTHORIZED TO SIGN OFFER (Type or Print)

15B. TELEPHONE NUMBER

15C. CHECK IF REMITTANCE ADDRESS IS DIFFERENT FROM

ABOVE - ENTER SUCH ADDRESS IN SCHEDULE.

17. SIGNATURE 18. OFFER DATE

AWARD (To be completed by Government)

19. ACCEPTED AS TO ITEMS NUMBERED 20. AMOUNT 21. ACCOUNTING AND APPROPRIATION

10 U.S.C. 2304(c) ( ) 41 U.S.C. 253(c) ( )

22. AUTHORITY FOR USING OTHER THAN FULL AND OPEN COMPETITION: 23. SUBMIT INVOICES TO ADDRESS SHOWN IN (4 copies unless otherwise specified)

ITEM

CODE:24. ADMINISTERED BY (if other than Item 7) CODE: RMGFO

GLOBAL FIN. SVCS (RM/GFS/ADO/FM) CHARLESTON, SOUTH

PO BOX 150008; Fax To: 1-866-483-3436

OFFICE OF CLAIMS (RM/GFS/F/C)

CHARLESTON, SC 29415-5008

25. PAYMENT WILL BE MADE BY

26. NAME OF CONTRACTING OFFICER (Type or print)

Edward J. Baran

(Signature of Contracting Officer)

27. UNITED STATES OF AMERICA 28. DATE

05/28/2008

IMPORTANT - Award will be made on this Form, or on Standard Form 26, or by other authorized official written notice.

AUTHORIZED FOR LOCAL REPRODUCTION

Previous edition is unusable

STANDARD FORM 33 (REV. 9-97)

Prescribed by GSA - FAR (48 CFR) 53.214(c)

SAQMMA08R0247

Table of Contents

Section Description Page Number

B Supplies or Services and Prices/Costs B.1 Supplies or Services and Prices/Costs

C Descriptions/Specifications/Statement of Work C.1 Descriptions

D Packaging and Marking D.1 Packing

E Inspection and Acceptance 52.246-4 Inspection of Services--Fixed-Price (Aug 1996) 52.246-11 Higher-Level Contract Quality Requirement (Feb 1999) 52.246-15 Certificate of Conformance (Apr 1984) Section E Acceptance

F Deliveries or Performance 52.242-17 Government Delay of Work (Apr 1984) F.1 Deliverables 52.242-15 Stop-Work Order (Aug 1989)

G Contract Administration Data 01INV Invoice Instructions 02INV Invoice Instructions - OBO Section G Administration Data

H Special Contract Requirements 652.204-70 Department of State Personal Identification Card Issuance Procedures (AUG 2007) Section H Special Requirements

I Contract Clauses 52.202-1 Definitions 52.203-3 Gratuities (Apr 1984) 52.203-5 Covenant Against Contingent Fees (Apr 1984) 52.203-6 Restrictions On Subcontractor Sales To The Government (Sept 2006) 52.203-7 Anti-Kickback Procedures (Jul 1995) 52.203-8 Cancellation, Rescission, and Recovery of Funds for Illegal or Improper Activity (Jan 1997) 52.203-12 Limitation On Payments To Influence Certain Federal Transactions (Sept 2007) 52.203-13 Contractor Code of Business Ethics and Conduct (Dec 2007) 52.204-2 Security Requirements (Aug 1996) 52.204-4 Printed or Copied Double-Sided on Recycled Paper (Aug 2000) 52.204-7 Central Contractor Registration (July 2006) 52.208-9 Contractor Use of Mandatory Sources of Supply 52.209-6 Protecting the Government's Interest When Subcontracting With Contractors Debarred, Suspended, or Proposed for Debarment (Sept 2006) 52.215-2 Audit and Records--Negotiation (June 1999) 52.215-2 Alt III Audit and Records--Negotiation (Jun 1999)- Alternate III (June 1999) 52.215-8 Order of Precedence--Uniform Contract Format (Oct 1997) 52.215-11 Price Reduction for Defective Cost or Pricing Data--Modifications (Oct 1997) 52.215-12 Subcontractor Cost or Pricing Data (Oct 1997) 52.215-13 Subcontractor Cost or Pricing Data--Modifications (Oct 1997) 52.215-19 Notification of Ownership Changes (Oct 1997) 52.215-21 Requirements for Cost or Pricing Data or Information Other Than Cost or Pricing Data--Modifications (Oct 1997) 52.216-18 Ordering (Oct 1995) 52.216-19 Order Limitations (Oct 1995) 52.216-22 Indefinite Quantity (Oct 1995) 52.217-8 Option to Extend Services (Nov 1999) 52.217-9 Option to Extend the Term of the Contract (Mar 2000) 52.219-4 Notice of Price Evaluation Preference for HUBZone Small Business Concerns (July 2005) 52.219-8 Utilization of Small Business Concerns (May 2004) 52.219-9 Small Business Subcontracting Plan (Nov 2007)

52.219-9 (DEVIATION) SMALL BUSINESS SUBCONTRACTING PLAN (SEPT 2006)

(DEVIATION)

52.219-9 Alt II Small Business Subcontracting Plan (Nov 2007)- Alternate II (Oct 2001)

52.219-23 Notice of Price Evaluation Adjustment for Small Disadvantaged Business Concerns (Sept 2005) 52.219-23 Alt I Notice of Price Evaluation Adjustment for Small Disadvantaged Business Concerns (Sept 2005)- Alternate I (June 2003) 52.219-23 Alt II Notice of Price Evaluation Adjustment for Small Disadvantaged Business Concerns (Sept 2005)- Alternate II (Oct 1998) 52.222-1 Notice to the Government of Labor Disputes (Feb 1997) 52.222-3 Convict Labor (June 2003) 52.222-4 Contract Work Hours and Safety Standards Act - Overtime Compensation (July 2005) 52.222-26 Equal Opportunity (Mar 2007) 52.222-29 Notification of Visa Denial (June 2003) 52.222-35 Equal Opportunity for Special Disabled Veterans, Veterans of the Vietnam Era and Other Eligible Veterans (Sept 2006) 52.222-36 Affirmative Action for Workers with Disabilities (June 1998) 52.222-37 Employment Reports on Special Disabled Veterans, Veterans of the Vietnam Era, and Other Eligible Veterans (Sept 2006) 52.223-2 Affirmative Procurement of Biobased Products Under Service and Construction Contracts.

(Dec 2007) 52.223-5 Pollution Prevention and Right-to-Know Information (Aug 2003) 52.223-6 Drug Free Workplace (May 2001) 52.223-15 Energy Efficiency in Energy-Consuming Products (Dec 2007) 52.224-1 Privacy Act Notification (Apr 1984) 52.224-2 Privacy Act (Apr 1984) 52.225-19 Contractor Personnel in a Designated Operational Area or Supporting a Diplomatic or Consular Mission Outside the United States (Mar 2008) 52.227-1 Authorization and Consent (Dec 2007) 52.227-2 Notice and Assistance Regarding Patent and Copyright Infringement (Dec 2007) 52.227-3 Patent Indemnity (Apr 1984) 52.227-3 Alt I Patent Indemnity (Apr 1984)- Alternate I (Apr 1984) 52.227-3 Alt II Patent Indemnity (Apr 1984)- Alternate II (Apr 1984) 52.227-11 Alt V Patent Rights--Retention by the Contractor (Dec 2007) -- Alternate V (Dec 2007) 52.227-14 Rights in Data--General (Dec 2007) 52.227-16 Additional Data Requirements (June 1987) 52.228-3 Worker's Compensation Insurance (Defense Base Act) (Apr 1984) 52.228-5 Insurance - Work on a Government Installation (Jan 1997) 52.229-3 Federal, State and Local Taxes (Apr 2003) 52.229-5 [Reserved] 52.229-6 Taxes--Foreign Fixed-Price Contracts (June 2003) 52.230-2 Cost Accounting Standards (Apr 1998) 52.230-3 Disclosure And Consistency Of Cost Accounting Practices (Apr 1998) 52.230-6 Administration of Cost Accounting Standards (Mar 2008) 52.232-1 Payments (Apr 1984) 52.232-8 Discounts For Prompt Payment (Feb 2002) 52.232-9 Limitation on Withholding of Payments (Apr 1984) 52.232-11 Extras (Apr 1984) 52.232-17 Interest (June 1996) 52.232-18 Availability Of Funds (Apr 1984) 52.232-19 Availability Of Funds For The Next Fiscal Year (Apr 1984) 52.232-23 Assignment Of Claims (Jan 1986) 52.232-23 Alt I Assignment of Claims (Jan 1986)- Alternate I (Apr 1984) 52.232-25 Prompt Payment (Oct 2003) 52.232-33 Payment by Electronic Funds Transfer--Central Contractor Registration (Oct 2003) 52.233-1 Alt I Disputes (July 2002)- Alternate I (Dec 1991) 52.233-3 Protest after Award (Aug 1996) 52.233-4 Applicable Law for Breach of Contract Claim (Oct 2004) 52.237-2 Protection Of Government Buildings, Equipment, And Vegetation (Apr 1984) 52.237-3 Continuity Of Services (Jan 1991) 52.242-13 Bankruptcy (July 1995) 52.243-1 Alt I Changes--Fixed Price (Aug 1987)- Alternate I (Apr 1984) 52.244-2 Subcontracts (June 2007) 52.244-5 Competition In Subcontracting (Dec 1996) 52.245-1 Alt I Government Property (June 2007)- Alternate I (June 2007)

52.245-2 Government Property Installation Operation Services (June 2007) 52.246-23 Limitation of Liability (Feb 1997) 52.246-25 Limitation of Liability--Services (Feb 1997) 52.247-63 Preference for U.S.-Flag Air Carriers (June 2003) 52.247-68 52.247-68 Report of Shipment (RESHIP) 52.249-2 Termination For Convenience Of The Government (Fixed-Price) 52.249-8 Default (Fixed-Price Supply and Service) (Apr 1984) 52.251-1 Government Supply Sources (Apr 1984) 52.253-1 Computer Generated Forms (Jan 1991) 652.225-71 Section 8(a) of the Export Administration Act of 1979, as Amended

652.216.70 Ordering - Indefinite-Delivery Contract

52.203-10 Price Or Fee Adjustment For Illegal Or Improper Activity (Jan 1997) 52.204-1 Approval of Contract (Dec 1989) 52.219-28 Post-Award Small Business Program Rerepresentation (June 2007) 52.222-39 Notification of Emlpoyee Rights Concerning Payment of Union Dues or Fees (Dec 2004) 52.225-13 Restrictions on Certain Foreign Purchases (Feb 2006) 52.243-1 Changes--Fixed Price (Aug 1987) 52.243-7 Notification of Changes (Apr 1984) 52.244-6 Subcontracts for Commercial Items (Mar 2007) 52.252-2 Clauses Incorporated by Reference (Feb 1998) 52.252-4 Alterations in Contract (Apr 1984) 52.252-6 Authorized Deviations in Clauses (Apr 1984)

J List of Attachments K Representations, Certifications, and Other Statements of Offerors or Respondents

52.204-8 Annual Representations and Certifications (Jan 2006) 52.230-1 Cost Accounting Standards Notices And Certification (June 2000) 652.225-70 Arab League Boycott of Israel Section K Certifications

L Instructions, Conditions, and Notices to Offerors and Respondents 52.214-35 Submission of Offers in U.S. Currency (Apr 1991) 52.215-1 Instructions to Offerors--Competitive Acquisition (Jan 2004) 52.215-5 Facsimile Proposals (Oct 1997) 52.216-27 Single or Multiple Awards (Oct 1995) 52.237-10 Identification of Uncompensated Overtime (Oct 1997) 52.232-28 Invitation to Propose Performance-Based Payments (Mar 2000) 52.232-28 Alt I Invitation to Propose Performance-Based Payments (Mar 2000)- Alternate I (Mar 2000) 52.233-2 Service of Protest (Sept 2006) 52.252-1 Solicitation Provisions Incorporated by Reference (Feb 1998) 52.252-3 Alterations in Solicitation (Apr 1984) 52.252-5 Authorized Deviations in Provisions (Apr 1984) 652.206-70 Competition Advocate/Ombudsman Section L Instructions

M Evaluation Factors for Award 52.217-4 Evaluation of Options Exercised at the Time of Contract Award (June 1988) 52.217-5 Evaluation of Options (July 1990) Section M Factors for Evaluation

001 0.00 Doc Ref No:

Delivery Date FOB:

B.1 Supplies or Services and Prices/Costs

B.1.1 MINIMUM AND MAXIMUM CONTRACT AMOUNTS--INDEFINITE QUANTITY

CONTRACT (05/95)

(a) Per FAR 52.216-22 "INDEFINITE QUANTITY," the minimum for this indefinite quantity contract shall be any quantity or combination of supplies and services equal to the amount(s) set forth below. If this contract contains options, the minimum for each option shall apply separately and independently to that option.

Base $120,000.00

Option 1 $120,000.00

Option 2 $120,000.00

Option 3 $120,000.00

Option 4 $120,000.00

(b) The maximum for this indefinite quantity contract (including options) shall be any quantity or combination of supplies and services equal (amount to be determined at time of award).

B.2 TYPE OF CONTRACT (05/95)

This is a Fixed Price, Indefinite Delivery/Indefinite Quantity Labor hour type contract.

B.3 DESCRIPTION OF SERVICES

The contractor will conduct a full scope financial audit of the Department's Consolidated Balance Sheets, Consolidated Statements of Net Cost, Consolidated Statements of Changes in Net Position, Combined Statements of Budgetary Resources, and Consolidated Statements of Financing as of, and for the years ended, September 30, 2009 and 2008 (collectively the Annual Financial Statements). And, as and if the government exercises the option years for the years ended, September 30, 2010, 2011, 2012 and 2013. The Performance and Accountability Report will include MD and A, the overview of the reporting entity, principal statements, notes to the financial statements, and required supplemental information. OIG anticipates that the Department will present the FY 2009 financial statements in comparative form, together with other information in its Performance and Accountability Report for FY 2009.

The audit shall be performed according to:

• GAO's Government Auditing Standards, 2003 Revision (or any amendments)

• OMB Bulletin 07-04, Audit Requirements for Federal Financial Statements, and any updated versions of this Bulletin. This Bulletin governs the conduct of Federal financial statement audits.

• OMB memorandum Revised Implementation Guidance for the Federal Financial Management Improvement Act, dated January 4, 2001, or any updated versions of this guidance.

• GAO's Federal Information System Controls Audit Manual (FISCAM).

• The Treasury Financial Manual (TFM).

• The joint PCIE/GAO Financial Audit Manual (FAM), which provides a standardized approach to performing financial statement audits.

SAQMMA08R0247

Line Item Summary

Solicitation Number:

SAQMMA08R0247

Contract Number: Title: FY09 Financial Audit Statement

Date of Solicitation:

05/28/2008

Line Item No. Description Quantity Unit Unit Price Total Cost

The contractor shall meet all applicable audit requirements, including any that might arise during the term of this assignment from revisions in audit requirements or guidance for federal government audits.

Annual Financial Statements

The contractor will develop an audit plan for auditing the Department's FY 2009 financial statements. The plan should be of sufficient detail to set forth the nature, timing, and extent of auditing procedures to be performed, develop the key planning documents to record and track analysis and decisions, and ensure that audit objectives are met. As part of the planning process for this audit, the contractor will need to develop a methodology for appropriately auditing internal controls and transactions in locations outside of Washington, D.C., and choose locations to perform this work.

The contractor will need to obtain an understanding and perform the testing for internal control, including controls related to budget execution, and compliance with laws and regulations, perform an assessment to determine whether the Department is in compliance with FFMIA, review MD and A, the overview, and other supplemental information in the Performance and Accountability Report for FY 2009 to determine if it is materially consistent with the FY 2009 Financial Statements and compliant with OMB guidance.

Information System Control Environment Review

As part of the audit of the Department's Annual Financial Statements for FY 2009, the contractor shall design and perform procedures to assess the effectiveness of the information system control environment. The contractor will develop an audit plan for this work. The procedures will focus on evaluating the adequacy of information systems controls over the following GAO FISCAM general control areas:

• entity-wide security program planning and management;

• access controls;

• segregation of duties;

• application software development and change control;

• system software controls and modifications; and

• service continuity.

This work should include a vulnerability assessment of the systems under review performed by someone knowledgeable in computer security.

Because the Department uses a number of systems to obtain information for financial statement preparation, the contractor may determine that it would be more cost beneficial to review the Department's financial management systems on a cyclical basis. If the contractor determines that this approach is more appropriate, the contractor will develop a 5-year plan that addresses the advantages/disadvantages of performing the work cyclically, identifies the systems that will be reviewed each year, and provides a justification (including risk factors) for the choice of systems.

In addition, the contractor will design and perform appropriate audit steps to determine the status of the internal control weakness related to information system security.

This work may be utilized by other OIG assignments, especially with respect to the FISMA requirements.

Thus, the information system control environment review performed under this task order shall be coordinated with the OIG auditors.

AUP Report for OPM

The contractor shall issue a separate report on AUPs performed on the Department's payroll office.

Specifically, the report should address retirement, health benefits, and life insurance withholdings/contributions and supplemental semiannual headcount reports submitted to OPM. The report shall be prepared in accordance with Attestation Standards contained in GAS, standards issued by the AICPA, and guidance provided by OMB.

The specific procedures shall be provided by OPM and/or OMB.

Year-End Closing Package

A report on the year-end closing package is required. The Department of the Treasury's closing package methodology and requirements for compiling the Governmentwide Financial Report (FR) are contained in Section 4705 of the TFM. The Closing Package (also known as the Special-Purpose Financial Statements) will provide a direct link between the Department's audited financial statements and the FR. The Department is required to prepare the Closing Package at the Department level, which includes providing selected audited financial statements (Balance Sheet, Statement of Net cost, and Statement of Changes in Net Position), crosswalking these statements to the governmentwide statements, identifying intragovernmental partners and balances, and preparing notes and other data.

The contractor will be responsible for performing the audit as required by OMB Bulletin 07-04 (and successor bulletins and technical amendments), which states that the audit will be performed in accordance with GAS and the provisions of the OMB Bulletin, and provide an opinion as to whether the Department's closing package is presented fairly in all material respects in conformity with generally accepted accounting principles and the presentation pursuant to the requirements of TFM Chapter 4700.

The contractor shall work with the Department's OIG to ensure that OIG meets requirements and the due dates for 2009. OIG anticipates that the report on Special-Purpose Financial Statements will be due no later than November 17, 2009.

AUP Report for Intra-governmental Activities and Balances

The contractor shall perform steps enumerated in TFM Volume I, Chapter 4700 related to Intra-governmental Activity and Balances. The contractor shall work with OIG to ensure that the work meets requirements and the due dates for this work for 2009.

Agency Financial Report (AFR)

The contractor shall determine whether information presented in the AFR is materially consistent with the Department's consolidated annual financial statements. The PAR will include the annual financial statements of the Department. The PAR is due to OMB by November 15, 2009.

Overall Conclusions

Overall conclusions are not to be discussed with any Department personnel without prior approval. Any potential issues are not to be discussed with Department personnel without the approval of the task monitor.

Furthermore, all contractor reports (both draft and final) shall be submitted only to the Department OIG, unless OIG authorizes the release.

B.4 PRICING

BASIC YEAR

Offerors are to provide prices for CLIN's 0001 to 0006 and 0008 to 0010 in the spaces below:

CLIN Estimated Hourly Total

Number Labor Category Hours Rates Amounts

0001 Partner/Principal * 2,700 $_______$________

0002 Audit Manager * 6,000 $_______$________

0003 Supervisor * 3,000 $_______$________

0004 Senior Accountant/Auditor 3,000 $_______$________

0005 Staff Accountant/Auditor 6,500 $_______$________

0006 Intern Accountant/Auditor 6,500 $_______$________

0007 Non-Audit Specialists** 2,000 $25,000.00

0008 EDP Project Manager * 2,000 $_______$________

0009 EDP Senior Auditor 2,000 $_______$________

0010 EDP Auditor 2,000 $_______$________

0011 Reimbursable Travel $100,000.00

Total Estimated Amount Base Year $_________

* Key Personnel (See Section C.4)

** This rate will be competed on individual delivery orders.

Option Year One Offerors are to provide prices for CLIN's 1001 to 1006 and 1008 to 1010 in the spaces below:

CLIN Estimated Hourly Total

Number Labor Category Hours Rates Amounts

1001 Partner/Principal * 1,400 $_______$________

1002 Audit Manager * 3,000 $_______$________

1003 Supervisor * 1,500 $_______$________

1004 Senior Accountant/Auditor 1,500 $_______$________

1005 Staff Accountant/Auditor 3,250 $_______$________

1006 Intern Accountant/Auditor 3,250 $_______$________

1007 Non-Audit Specialists ** 1,500 $50,000.00

1008 EDP Project Manager * 1,000 $_______$________

1009 EDP Senior Auditor 1,000 $_______$________

1010 EDP Auditor 1,000 $_______$_______

1011 Reimbursable Travel $100,000.00

Total Estimated Amount Option Year One $_________

* Key Personnel (See Section C.4)

** This rate will be competed on individual delivery orders.

Option Year Two Offerors are to provide prices for CLIN's 2001 to 2006 and 2008 to 2010 in the spaces below:

CLIN Estimated Hourly Total

Number Labor Category Hours Rates Amounts

2001 Partner/Principal * 1,400 $_______$________

2002 Audit Manager * 3,000 $_______$________

2003 Supervisor * 1,500 $_______$________

2004 Senior Accountant/Auditor 1,500 $_______$________

2005 Staff Accountant/Auditor 3,250 $_______$________

2006 Intern Accountant/Auditor 3,250 $_______$________

2007 Non-Audit Specialists** 1,500 $50,000.00

2008 EDP Project Manager * 1,000 $_______$________

2009 EDP Senior Auditor 1,000 $_______$________

2010 EDP Auditor 1,000 $_______$________

2011 Reimbursable Travel $100,000.00

Total Estimated Amount Option Year Two $_________

* Key Personnel (See Section C.4)

** This rate will be competed on individual orders.

Option Year Three Offerors are to provide prices for CLIN's 3001 to 3006 and 3008 to 3010 in the spaces below:

CLIN Estimated Hourly Total

Number Labor Category Hours Rates Amounts

3001 Partner/Principal * 1,400 $_______$________

3002 Audit Manager * 3,000 $_______$________

3003 Supervisor * 1,500 $_______$________

3004 Senior Accountant/Auditor 1,500 $_______$________

3005 Staff Accountant/Auditor 3,250 $_______$________

3006 Intern Accountant/Auditor 3,250 $_______$________

3007 Non-Audit Specialists ** 1,500 $50,000.00

3008 EDP Project Manager * 1,000 $_______$________

3009 EDP Senior Auditor 1,000 $_______$________

3010 EDP Auditor 1,000 $_______$________

3011 Reimbursable Travel $100,000.00

Total Estimated Amount Option Year Three $_________

* Key Personnel (See Section C.4)

** This rate will be competed on individual delivery orders.

Option Year Four Offerors are to provide prices for CLIN's 4001 to 4006 and 4008 to 4010 in the spaces below:

CLIN Estimated Hourly Total

Number Labor Category Hours Rates Amounts

4001 Partner/Principal * 1,400 $_______$________

4002 Audit Manager * 3,000 $_______$________

4003 Supervisor * 1,500 $_______$________

4004 Senior Accountant/Auditor 1,500 $_______$________

4005 Staff Accountant/Auditor 3,250 $_______$________

4006 Intern Accountant/Auditor 3,250 $_______$________

4007 Non-Audit Specialists** 1,500 $50,000.00

4008 EDP Project Manager * 1,000 $_______$________

4009 EDP Senior Auditor 1,000 $_______$________

4010 EDP Auditor 1,000 $_______$________

4011 Reimbursable Travel $100,000.00

Total Estimated Amount Option Year Four $_________

* Key Personnel (See Section C.4)

** This rate will be competed on individual delivery orders.

B-5. GRAND SUMMARY BASE YEAR AND 4 OPTION YEARS FOR OFFER EVALUATION.

Offerors are to provide prices in the spaces below for the base year, for each of the 4 option years, and the total amount for the base year and 4 option years.

Total amount for base year $_________

Total amount for option year 1 $_________

Total amount for option year 2 $_________

Total amount for option year 3 $_________

Total amount for option year 4 $_________

TOTAL BASE YEAR AND 4 OPTION YEARS $_________

B.6 Travel. The contractor shall keep complete and accurate records to support all invoices for travel expenses under this contract.

Travel expenses incurred by the contractor shall be in accordance with the Standard Government Travel Regulations, Joint Travel Regulations, or the Federal Travel Regulation's in effect at the time of each trip, and not exceed the following:

(a) Contractor employees may make one weekend trip at Government expense to home base in accordance with per diem rates in effect at the time of travel, for each three weeks in continuous travel status. This policy applies to Washington, D.C. area contractor employees in the conterminous United States. Other trips away from a job site for personal reasons shall be during off duty hours.

(b) Cost of air travel by the most direct route. Air Coach and air tourist accommodations constitute the normal class or airfare that shall be utilized. First class airfare shall not be authorized or allowed under this contract.

(c) The contractor shall not be reimbursed for labor-hours utilized while in travel status for travel performed after 5 p.m. Monday through Friday, or any time on Saturdays, Sundays, or holidays including foreign post local holidays.

(d) Travel by motor vehicle including rented automobile shall be reimbursed on a reasonable actual expense basis, or at the contractor's option on a mileage basis at a rate in effect at the time of travel plus any toll and ferry charges.

The above travel expense shall be reimbursed on actual cost basis in accordance with the Federal Travel Regulations.

PAYMENT

Compensations

The contractor shall provide information on rates for all major categories of staffing and estimate a number of hours for each labor category by phase of the audit (planning, internal control, testing, and reporting). This information will be included in the final contract.

Travel

The contractor and OIG must agree on travel plans. The contractor will prepare a cost estimate of the travel plans, which will be approved by the COR and task monitors.

Section C - Descriptions/Specifications/Statement of Work

C.1 Descriptions

C.1.1 INCORPORATION OF CONTRACTOR'S TECHNICAL PROPOSAL (05/95)

(a) The contractor shall perform this contract in accordance with its technical proposal dated ______ and any revisions thereto submitted in response to Solicitation No. S-AQMMA-08-R-0247.

(b) The contractor's technical proposal is incorporated by reference and hereby made subject to the provisions of the "ORDER OF PRECEDENCE" clause in SECTION I of this contract. Under the "ORDER OF PRECEDENCE" clause, the contractor's technical proposal shall follow "the specifications" in the order of precedence.

C.2 SCOPE

The scope of this contract is the U.S. Department of State's financial statements for FY 2009, and if and as the government exercises option years, the Department's financial statements for FYs 2010, 2011,2012 and 2013.

I. The overall objective of this statement of work is to obtain an auditor's opinion on the U.S. Department of State's (Department's) financial statements for FY 2009. The work under this task will be used to: (1) meet the requirements of the Chief Financial Officers (CFO) Act of 1990, as amended, as defined by the Office of Management and Budget (OMB) Bulletin 07-04, Audit Requirements for Federal Financial Statements, as amended, or the most current guidance, (2) provide a basis for the Government Accountability Office (GAO) to determine the extent to which it can use the audit work performed under this statement of work in support of GAO's annual audit of the U.S. government-wide financial report of which the Department is a component, (3) assist Department management in assessing the effectiveness of internal controls and compliance with laws and regulations, and (4) assist Department and Office of Inspector General (OIG) management in determining the effectiveness of information technology (IT) related internal controls and compliance with the Federal Financial Management Improvement Act of 1996 (FFMIA).

Additional requirements include: evaluating and reporting on internal control and the internal control environment; reviewing the information system control environment; performing tests of appropriate laws and regulations; rendering an opinion on the Department's Closing Package; performing agreed-upon procedures (AUP) for retirement, health, and life insurance withholdings/contributions, and employee headcount information; and performing AUP or other required steps on intra-governmental activities and balances.

II. Any audits conducted under this statement of work shall be performed in accordance with generally accepted government auditing standards (GAGAS), as specified in the current version of the GAO Government Auditing Standards (GAS), and additional OMB audit requirements. Audit methodology, at a minimum, shall be consistent with the most current version of the GAO/President's Council on Integrity and Efficiency (PCIE) Financial Audit Manual (FAM). The contractor must provide documentation demonstrating how any inconsistent methodology satisfies the requirements of the FAM.

The contractor shall perform procedures in accordance with GAO's Federal Information System Controls Audit Manual (FISCAM) to assess the effectiveness of the agency's system control environment.

III. Pricing Format The government intends to award an indefinite delivery/indefinite quantity, labor hour contract with not to exceed amounts for a base year and four one year options.

The contractor shall propose the specific labor categories and quantities for each of the four phases of the audit (planning, internal control, testing, and reporting) consistent with the contract and the technical approach described in this Statement of Work.

IV. Deliverables shall include a staffing list; an independence/quality control assurance statement; detailed audit planning documents; audit programs, Notification of Findings and Recommendations; Summary of Unadjusted Audit Differences; Financial Statement Audit Completion Checklist (FAM 1003); report on the audit of the Annual Financial Statements, and Management Letter. Furthermore, a report on the information system control environment review, a report on the special-purpose financial statements (year-end closing package), and reports for AUPs for the Office of Personnel Management and intra-governmental transactions are required.

See the statement of work Section F Deliverables for further detail.

V. Submit monthly invoices and progress reports to OIG by the tenth calendar day of each month. The contractor will send an original and three copies of invoices to the contracting officer's representative. It will also send a copy of invoices to the contracting officer.

VI. Submission Dates

For the consolidated audit, the draft reports for the FY 2009 statements shall be submitted no later than November 1, 2009; and the final reports shall be submitted no later than November 10, 2009.

C.3 STATEMENT OF WORK

I. OBJECTIVES

The objectives of the work under this statement of work are to:

1. Determine and report on whether the financial statements and related notes present fairly, in all material respects, the assets, liabilities, and net position; net costs, changes in net position, and budgetary resources, in conformity with the accounting principles generally accepted in the United States.

2. Perform appropriate procedures consistent with AICPA Auditing Standard AU Section 558, "Required Supplementary Information," on all Required Supplementary Information included in the Department's FY 2009 consolidated financial statements.

3. Determine whether risk-assumed information (including projections of pensions) is presented fairly in all material respects, in accordance with the requirements of the Statement of Federal Financial Accounting Standards (SFFAS) No. 5, and any subsequent revisions. If a specialist is used for this work, the auditor shall comply with guidance in AU Section 336, "Using the Work of a Specialist."

4. Assess whether the other accompanying information, or its manner of presentation, is materially consistent with the information in the Annual Statements.

5. Evaluate and report on internal control and the internal control environment related to the FY 2009 consolidated financial statements for the Department. This should include, but not be limited to, obtaining an understanding of the components of internal control and assessing the level of control risk relevant to the assertions embodied in the classes of transactions, account balances, and disclosures components of the financial statements.

6. Review information system general and application controls in the Department's applications that are significant to the financial statements to the extent necessary to (1) conclude whether general controls are properly designed and operating effectively, (2) consider application controls as part of the internal control assessment in the financial statement audit, and (3) support the Federal Financial Management Improvement Act (FFMIA) assessment.

7. Obtain an understanding of the process by which the agency identifies and evaluates weaknesses required to be reported under Federal Managers' Financial Integrity Act (FMFIA) and related agency implementing procedures. Compare material weaknesses disclosed during the audit with those material weaknesses reported in the agency's FMFIA report that relate to the financial statements. If material weaknesses were disclosed during the audit that were not reported in the Department's FMFIA report, auditor will determine whether the failure to detect and report material weaknesses constitutes a reportable condition or material weakness in the entity's internal control.

8. Perform tests of compliance with laws and regulations that could have a direct and material effect on the Department's FY 2009 consolidated financial statements, including FFMIA.

9. For allocation transfers, coordinate early with "child" agencies to ensure that adequate audit coverage will be provided.

10.Determine whether the special-purpose financial statements and accompanying notes are presented fairly, in all material respects, in conformity with the accounting principles generally accepted in the United States of America and the presentation requirements set forth in the Treasury Financial Manual (TFM), Chapter 4700.

11.Obtain an understanding of internal control over the financial reporting process for the closing package financial statements and perform tests of those controls. Consider the internal control steps performed during the audit of the general purpose financial statements.

12.Perform tests of compliance with TFM Chapter 4700. Consider the testing related to compliance with laws and regulations performed during the audit of the general purpose financial statements.

13.Assess the reasonableness of FY 2009 retirement, health, and life insurance withholdings/contributions, and employee headcount information provided to the Office of Personnel Management (OPM), as required by OMB Bulletin 07-04, as amended. Comply with any additional guidance issued by either OPM or OMB during FY 2009.

II. ENTITY TO BE AUDITED

Background/Organization

Mission The Department is the lead institution for the conduct of American diplomacy; its mission is based on the Secretary of State's role as the President's principal foreign policy advisor.

The Department's overall mission is to create a more secure, democratic, and prosperous world for the benefit of the American people and the international community. It advances U.S. objectives and interests in the world through its primary role in developing and implementing the President's foreign policy and provides an array of important services to U.S. citizens abroad and to foreigners seeking to visit or immigrate to the U.S.

For more details on the Department's mission, please see http://www.state.gov/s/d/rm/rls/dosstrat/2004/23503.htm

History Under Article II of the Constitution of the United States ratified in 1789, the President has the power to conduct the nation's foreign relations, including making treaties--as long two-thirds of the Senate concurs--and to nominate ambassadors, public ministers, and consuls with the advice and consent of the Senate.

On May 19, 1789, then Representative James Madison of New York introduced a bill to create an executive Department of Foreign Affairs. On July 27, 1789, President Washington signed legislation to that effect, making it the first federal agency to be created under the new Constitution. This legislation remains the basic law of the Department.

Congress passed another law giving certain additional responsibilities to the new Department and changing its name to the Department of State; and Washington approved this act on September 15, 1789.

On September 29, 1789, Thomas Jefferson was appointed to be the first U.S. Secretary of State.

See http://www.state.gov/r/pa/ho/time/ for additional information on the history of the Department.

Organizational Structure/Management/Organizational Chart

The Department has embassies, consulates, and other posts in over 260 locations. The Department's workforce consists of employees in the civil service and foreign service, and foreign service nationals.

Organizational Structure in Washington, DC - At its headquarters in Washington, DC, the Department's mission is carried out through six regional bureaus, each of which is responsible for a specific geographic region of the world, the Bureau of International Organization Affairs, and numerous functional and management bureaus. These bureaus provide policy guidance, program management, administrative support, and in-depth expertise in matters such as law enforcement, economics, the environment, intelligence, arms control, human rights, counter-narcotics, counterterrorism, public diplomacy, humanitarian assistance, security, nonproliferation, consular services, and other areas.

Organizational Structure at Embassies - In each Embassy, the Chief of Mission (usually an Ambassador) is responsible for executing U.S. foreign policy goals and coordinating and managing all U.S. Government functions in the host country. The President appoints each Ambassador, whom the Senate confirms. Chiefs of Mission report directly to the President through the Secretary.

Please see http://www.state.gov/r/pa/ei/rls/dos/54734.htm for the Department's organization chart.

Other Pertinent Information

The Department also operates national passport centers in Portsmouth, New Hampshire, and Charleston, South Carolina; a national visa center in Portsmouth, New Hampshire, and a consular center in Williamsburg, Kentucky; two foreign press centers; one reception center; 13 passport agencies; five offices that provide logistics support for overseas operations; 20 security offices; and two financial service centers in Charleston, South Carolina, and Bangkok, Thailand.

Funding

Overall Funding For 2006, the Department received approximately $26.4 billion in budgetary resources, primarily consisting of:

direct or related appropriations ($16.1 billion), authority financed from trust funds ($1.3 billion), spending authority from providing goods and services ($4.4 billion), and unobligated balances (4.3 billion).

Department Financial Management Organization

The Assistant Secretary for Resource Management is also the Department's Chief Financial Officer. The Assistant Secretary administers the development of the Department's internal planning, budgeting, and accounting functions. He assists foreign affairs agency heads with developing policies, plans, and programs to achieve foreign policy goals and directs the coordination of resource requirements to enable the Secretary of State to present integrated International Affairs resources submissions to OMB and to the Congress.

The Bureau of Resource Management (RM) employs over 1200 people across the globe. With five major divisions (Global Financial Services; International Cooperative Administrative Support Services; Strategic and Performance Planning; State Programs, Operations, and Budgets; and the Executive Office), the Bureau oversees all strategy and performance planning, state operations and foreign assistance budgeting and resource management, global accounting, disbursing and payroll, and issuance of the financial statements and "annual report" of the Department.

Accounting Systems

Internal The Department uses many systems to gather information for financial statement preparation. The following list includes the major systems that are used. However, there are other, less significant systems that are also used.

Global Financial Management System - Domestic accounting system.

Regional Financial Management System - Overseas accounting system.

Consolidated American Payroll Processing System - American employee payroll system.

Domestic Accounts Receivable Tracking System - Domestic accounts receivable system.

Foreign Affairs Retirement and Disability System - Foreign service officers pension system.

FSN Payroll System - Foreign service national payroll system.

Hyperion - Financial reporting application.

Integrated Logistics Management System - Logistics management (Property management module).

International Cooperative Administrative Support System - Allocates costs of overseas posts to other agencies.

Momentum Fixed Assets - Consolidated property system.

Project Cost Accounting System - Capital improvement and construction projects.

Government-wide/Outside Systems

The Department of Labor calculates the Department's payments for FECA.

The Office of Personnel Management calculates the Department's payments for CSRS, FERS, FEHBP, and

FEGLI.

The Department uses information from the Bureau of Public Debt to report its investments.

The Department uses the Department of Health and Human Services, Payment Management System, to make payments to certain grantees.

Accounting Records

The Department's accounting records are decentralized. Although RM is ultimately responsible for financial management issues, the Department has more than 260 locations, all of which perform accounting transactions.

Most of the locations are overseas.

RM has three locations to process accounting transactions. The majority of accounting processing is in Charleston, South Carolina. However, some processing is done in Bangkok, Thailand, and in Washington, D.C.

Financial Statement Preparation

Who Prepares the Financial Statements

The Deputy Chief Financial Officer takes the lead on preparing the financial statements. He has a staff dedicated to this effort in the Directorate of Financial Planning, Reporting, and Analysis. In addition to full-time staff, this office also utilizes external contractors for certain financial statement compilation efforts.

However, much of the information included on the financial statements is originated by Financial Management Officers overseas or Executive Offices in domestic bureaus.

Detailed Guidance

The Department maintains General Funds, Special Funds, Revolving Funds, Trust Funds, and Deposit Funds.

• General and Special Funds are used to record financial transactions under Congressional appropriations or other authorization for spending general revenues.

• Revolving Funds are established by law to finance a continuing cycle of operations. Receipts derived from such operations are usually available in their entirety for the Funds to use without further action by Congress.

• Trust Funds are credited with receipts that are generated by the terms of a trust agreement or statute. At the point of collection, these receipts are either available immediately or unavailable depending upon statutory requirements. The largest trust fund is the Foreign Service Retirement and Disability Fund (FSRDF).

• Deposit Funds are established for: (1) amounts received for which the Department is acting as a fiscal agent or custodian; (2) unidentified remittances; (3) monies withheld from payments for goods and services received; and (4) monies held awaiting distribution on the basis of a legal determination.

The Department prepares its statements as required by the Chief Financial Officers Act, as amended, and presented in accordance with form and content requirements contained in Form and Content of Agency Financial Statements, which is part of OMB Circular A-136. The statements are prepared in accordance with the Department's accounting policies and follow accounting principles generally accepted in the United States of America (GAAP).

Basis of Accounting - Transactions are recorded on both an accrual and budgetary basis. Under the accrual basis, exchange revenues are recognized when earned, and expenses are recognized when a liability is incurred.

Budgetary accounting facilitates compliance with legal constraints and controls over the use of Federal funds.

Revenues and Other Financing Sources - Department operations are financed through appropriations, reimbursement for the provision of goods or services to other Federal agencies, proceeds from the sale of property, certain consular-related and other fees, and donations. In addition, the Department collects passport, visa, and other consular fees that are not retained by the Department but are deposited directly to a Treasury account. The passport and visa fees are reported as earned revenues on the Statement of Net Cost and as a transfer-out of financing sources on the Statement of Changes in Net Position.

For financial statement purposes, appropriations are recorded as a financing source (i.e., Appropriations Used) and reported on the Statement of Changes in Net Position at the time they are recognized as expenditures.

Appropriations expended for capitalized property and equipment are recognized when the asset is purchased.

The applicable depreciation expense for real and personal property is recorded over the asset's useful life as described below in Property and Equipment.

Work performed for other Federal agencies under reimbursable agreements is initially financed through the account providing the service and is subsequently reimbursed. Reimbursements are recognized as revenue when earned, i.e., goods have been delivered or services rendered, and the associated costs have been incurred.

Administrative support services at overseas posts are provided to other Federal agencies through the International Cooperative Administrative Support Services (ICASS). ICASS bills for the services it provides to agencies at overseas posts. These billings are recorded as revenue to ICASS and must cover all overhead costs, operating expenses, and replacement costs for capital assets needed to carry on the operation.

Proceeds from the sale of real property, vehicles, and other personal property are recognized as revenue when the proceeds are credited to the account from which the asset was funded. For non-capitalized property, the full amount realized is recognized as revenue. For capitalized property, revenue or loss is determined by whether the proceeds received were more or less than the net book value of the asset sold. The Department retains proceeds of sale, which are available for purchase of the same or similar category of property.

The Department is authorized to collect and retain specific user fees for machine-readable visas, expedited passport processing, and fingerprint checks on immigrant visa applicants.