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Xpand Corporation is a small information technology consulting firm that received a noncompetitive cost-plus-fixed-fee contract under the U.S. Small Business Administration's "set-aside" program to provide technical support and assistance in re-engineering ETA's Training Technology Resource Center. The OIG audited the CY 1997 costs Xpand claimed for reimbursement, and the CY 1998 direct costs portion of the costs claimed for reimbursement. We questioned $106,757 of the $1,427,426 audited under the DOL contract, primarily because:
• Xpand was unable to provide documentation to support certain consultant fees, communications costs, and purchases of supplies properly; and
• the two principals and owners of the corporation awarded themselves a total of $74,874 in year-end bonuses ($37,437each) without the required prior review and approval by DOL.
The OIG questioned $58,090 of the bonuses, the portion OIG considered to be unreasonable.
(OA Report No. 18-00-001-03-375, issued November 29, 1999)
