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On February 7, the US Government Accountability Office (GAO) issued its Report to Congressional Committees on Contractor Business Systems (CBS), DOD Needs Better Information to Monitor and Assess Review Process (GAO-19-212).

The report addresses weaknesses in the CBS review process and outlines plans for increased CBS reviews. For contractors, the report should serve as notice that CBS reviews could occur much more frequently and become more stringent, and payment withholds for disapproved contractor business systems could increase. For example, the report indicates a dramatic uptick in the number of CBS reviews planned for fiscal years 2019 through 2022 compared to reviews conducted during fiscal years 2015 through 2018 (see Figure 3 of page 24).

While the report indicates significant issues with the current CBS review process, including lack of CBS review timeliness, payment withholds tracking, and clearly defined audit roles, the report also suggests contractors should be prepared for far more attention to be paid to CBS reviews as compared to in recent past.