Keeping accurate records as a GSA contractor is crucial for compliance and maintaining your federal contract. This article highlights seven common record-keeping mistakes that can lead to audits, penalties, or even contract termination. Here’s a quick breakdown:

• Missed Sales Reporting Deadlines: Late or inaccurate sales reports can trigger audits and financial penalties.
• Incomplete Contract Modification Documentation: Missing paperwork slows approvals and disrupts operations.
• Omitting GSA Contract Numbers on Quotes: Leads to lost opportunities and buyer confusion.
• Incorrect Order Level Materials (OLMs) Tracking: Mislabeling or exceeding limits risks compliance issues.
• Poor Record Retention: Missing records during audits can result in severe consequences.
• Lack of Standard Operating Procedures (SOPs): Inconsistent processes increase errors and compliance risks.
• Slow Responses to Contracting Officers: Delays can damage relationships and stall projects.

Each mistake has unique risks, but poor record retention stands out as the most severe. By implementing clear processes, training your team, and staying organized, you can avoid these pitfalls and protect your contract.

Scope of Contract Training for MAS Vendors

1. Missing Sales Report Deadlines and Accuracy Requirements

Meeting sales reporting deadlines is not optional – it’s a critical requirement that can directly impact your GSA contract. Yet, many contractors struggle with this, facing repercussions far more serious than just a late fee.

Under the TDR program, MAS contractors must report monthly, while Schedule contractors report quarterly. These reports are submitted through the FAS Sales Reporting Portal and must be completed within 30 days after the end of the reporting period. Missing this deadline results in a delinquency notification.

Here’s why it matters: GSA’s Federal Acquisition Service (FAS) is funded by a 0.75% Industrial Funding Fee (IFF) applied to your contract sales. Timely and accurate reporting ensures proper IFF payments and helps you avoid audits or penalties.

What’s Required? Contractors must report 16 specific transactional data elements within the 30-day window. These go beyond basic dollar amounts – you’ll need to track sales by Special Item Number (SIN), maintain detailed transaction records, and ensure your IFF payments match your reported sales.

How to Stay on Track

• Get Familiar with the Tools: Register for a FAS ID and learn how to use the Sales Reporting Portal, especially the Adjust Sales feature.
• Set Reminders: Automate alerts for quarterly IFF filing deadlines – January 30, April 30, July 30, and October 30.
• Reconcile Regularly: Review sales monthly to identify and address discrepancies early.
• Train Your Team: Educate your sales and accounting teams on identifying GSA-eligible sales. Using a GSA flag or specific naming conventions in your accounting system can simplify the process.

If you miss a reporting period, you’ll need to submit data for all prior periods before filing the current one. For assistance, reach out to the Vendor Support Center (VSC) Helpdesk at 877-495-4849 or vendor.support@gsa.gov.

Non-compliance isn’t just a paperwork issue – it can lead to penalties, audits, or even the cancellation of your contract. By implementing the right systems and maintaining attention to detail, you can prevent these problems altogether.

2. Poor Documentation for Contract Modifications

In the world of GSA contracting, contract modifications are bound to happen. They might seem routine, but if the documentation isn’t up to par, they can lead to frustrating delays. Incomplete or inaccurate paperwork not only slows down approvals but can also disrupt ongoing operations.

Modifications can range from adding new products or services to updating prices, revising terms and conditions, or handling administrative updates like changing contact information or key personnel. Every single change requires thorough and precise documentation to avoid the hassle of resubmissions and unnecessary delays.

But the impact of bad documentation goes beyond just slowing things down. Errors in solicitation documents can create significant bottlenecks, throwing a wrench into the entire process.

Essential Documentation Requirements

When preparing for any contract modification, certain documentation is non-negotiable. This includes technical data, detailed cost breakdowns, and justifications for pricing changes. GSA provides specific templates for different types of modifications, and using these templates is critical to ensuring your submission meets their standards.

For example, if you’re adding products to your contract, you may need a letter of supply – especially if the manufacturer isn’t part of the Verified Products Portal, you’re working with commercial off-the-shelf (COTS) products, or you’re introducing a new manufacturer to your contract. Administrative changes, on the other hand, require entirely different paperwork, such as change of name or novation agreement templates when applicable.

Every amendment must be documented in writing, with signed and dated confirmations. To avoid confusion, always reference the original contract’s title, the parties involved, and the signing date. Instead of vaguely describing the changes, it’s better to restate the entire section or paragraph with the updated language. This ensures there’s no ambiguity about what governs the contract moving forward.

Streamlining Your Documentation Process

While following the required documentation standards is essential, proactive planning can make the entire process smoother and faster. Start by submitting modification requests as early as possible to factor in GSA’s lengthy review times. Always use the latest templates and guidance from GSA’s MAS Modification Guidance to avoid automatic rejections. For price-related modifications, include detailed explanations and robust supporting documentation to speed up the review.

Maintaining open communication with your GSA Contracting Officer (CO) throughout the process is equally important. If you’re dealing with a time-sensitive modification – like one tied to a pending Task Order or an expiring Request for Quote – notify your CO immediately and provide evidence of the urgency. Whenever possible, consolidate multiple changes under a single modification request to streamline processing.

Regularly reviewing your contract can also help you stay ahead of potential modifications. Keeping your documentation up to date and staying informed about regulatory updates ensures you’re always prepared. What might seem like a bureaucratic challenge can actually become an opportunity to improve your competitive edge.

For OASIS+ contracts, all modification requests and supporting documents must be submitted through FedConnect. Whether you’re dealing with option exercises, cancellations, novations, or simple administrative updates, proper preparation and attention to detail can save you weeks of back-and-forth communication.

3. Leaving GSA Contract Numbers Off Quotes

When it comes to proper quoting practices, one essential detail can’t be overlooked: including your GSA contract number. This isn’t just a formality – it’s a key identifier that signals to government buyers that you’re an approved vendor. Leaving it off your quotes can create confusion and even cost you valuable opportunities.

Your GSA contract number, also known as your MAS Schedule contract number, is awarded as part of your GSA contract. It’s a crucial piece of information that establishes your compliance and legitimacy in the eyes of federal buyers.

Why Your GSA Contract Number Matters to Government Buyers

Federal agencies favor purchasing from MAS Schedule contract holders because it ensures they’re getting pre-approved products and services. By including your GSA contract number on every quote, you make it clear that you’re part of this trusted network. It also reinforces that GSA has already negotiated the best price and value, giving you a competitive edge.

On the flip side, if your quote doesn’t display your GSA contract number, buyers might not realize you’re a qualified GSA vendor. They could mistake you for a regular commercial supplier, which might lead to disqualification or require them to jump through extra procurement hoops.

Creating a Consistent Quoting Process

The best way to avoid this oversight? Build consistency into your quoting process. This starts with clear roles and responsibilities within your contract management system to ensure nothing slips through the cracks.

Investing in contract management software can also help. These tools allow you to set reminders and alerts for key contract-related tasks. Standardized quote templates are another simple but effective solution. By designing templates that automatically include your GSA contract number in a prominent spot, you reduce the chances of human error. Additionally, a contract playbook can provide your team with clear instructions on where and how to display your contract number across quotes, proposals, and invoices.

Automating Safeguards for Accuracy

To further reduce errors, consider implementing automated workflows through contract management software. These workflows can flag quotes missing a GSA contract number before they’re sent out, ensuring compliance at every step.

Regular compliance training is equally important. Make sure your team understands the regulatory requirements and their role in upholding them. Contract compliance isn’t just the responsibility of one person – it’s a shared commitment across your entire organization.

4. Wrong Coding and Tracking of Order Level Materials (OLMs)

Accurate tracking of Order Level Materials (OLMs) is essential for maintaining compliance with GSA requirements. These materials, which can account for up to 33.33% of your total contract value, require meticulous coding and documentation to meet regulatory standards. Missteps in this area not only disrupt compliance but can also lead to costly errors.

One common mistake is mislabeling OLMs as open market items. This creates reporting inaccuracies since OLM sales must be reported as GSA Schedule sales under the Trade Agreements Act (TAA), unlike open market items.

Per GSA guidelines:

"All items sold through the OLM SIN must be reported as GSA Schedule sales. Contractors should distinctly label OLM items as GSA items rather than open market items to avoid confusion and ensure proper reporting."

Another frequent violation involves quoting OLMs without proper authorization. The GSA explicitly states:

"A contractor that quotes OLMs without having the OLMs SIN awarded under its contract is in violation of the terms and conditions of its MAS contract."

Setting Up Proper Tracking Systems

To stay compliant, real-time tracking systems are a must. Automated tools can monitor OLM values against your total contract amount and send alerts as you approach the 33.33% cap. Relying on manual tracking for federal orders is risky and often insufficient.

Your system should also flag when OLMs exceed the Simplified Acquisition Threshold (SAT). At that point, you’re required to obtain at least three competitive quotes and maintain detailed records justifying your pricing decisions. Failure to meet these requirements during a GSA audit can result in serious compliance issues.

Documentation Standards That Pass Audits

Clear and accurate documentation is the backbone of audit preparation. Every invoice should be clearly labeled, using specific line items or codes to identify OLMs for both internal teams and government buyers. This step minimizes errors and ensures proper sales reporting.

For high-value OLMs, maintain detailed records, including competitive quotes, pricing justifications, and explanations for any deviations, such as why obtaining three quotes wasn’t feasible. These documents should be stored in a centralized digital repository for easy access during audits or inquiries.

Avoiding Common Compliance Traps

One often-overlooked requirement is updating your Authorized Federal Supply Schedule Price List immediately after adding the OLMs SIN to your contract. This administrative step is mandatory and will be checked by GSA contracting officers during procurement reviews.

Regular internal audits can help catch and prevent OLM-related violations. These reviews should ensure your team follows established procedures, maintains thorough documentation, and adheres to usage limits. Mock audits can also be a great way to test your readiness and identify any weaknesses in your processes.

The key to managing OLMs effectively lies in integrating them into your broader compliance strategy. When your team understands the requirements and follows consistent procedures, you reduce the risk of errors that could jeopardize your GSA contract. By treating OLM management as a critical part of your overall approach, you’ll be better positioned to avoid compliance pitfalls.

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5. Poor Record Retention Practices

Keeping accurate and accessible records isn’t just a good habit – it’s a legal requirement for staying compliant with GSA contracts. Unfortunately, many contractors underestimate just how complex GSA record-keeping rules can be, and this oversight can lead to serious consequences, including contract cancellations.

If you’re a GSA contractor, subcontractor, or part of an organization that handles GSA-controlled information, you’re bound by the GSA Records Management Program. This means you’re legally required to maintain records that support every stage of contract management, from negotiation to audits. Let’s take a closer look at the retention periods and requirements you need to meet.

Understanding GSA Retention Requirements

Not all records are created equal – different types have different retention timelines. For instance:

• Electronic records for GSA SmartPay transactions: Keep these for six years after the final contract payment.
• GPC transaction documentation: Also requires a six-year retention, as outlined in FAR 4.805.

Financial records come with their own rules:

• Accounts receivable and accounts payable records: Retain these for four years.
• Labor cost distribution cards and petty cash records: Only need to be kept for two years.
• Equipment records and maintenance work orders: Fall under a four-year retention period.

Failing to stick to these guidelines can lead to fines, legal trouble, and even harm your reputation.

The Real Cost of Poor Retention Practices

Once you understand the requirements, it’s clear that neglecting them can be costly. Poor record retention doesn’t just mean missing paperwork – it can snowball into a series of compliance failures. If your documentation isn’t available during audits or investigations, it’s seen as noncompliance. This can result in fines, legal actions, and even damage your standing in federal contracting.

Beyond compliance risks, poor retention practices can open the door to data breaches, disrupt operations, and lead to unexpected expenses. And with GSA’s plans to “rightsize” the Multiple Award Schedule (MAS) program, non-compliance could mean losing your schedule altogether.

Building a Compliant Storage System

To avoid these pitfalls, start with a solid record retention system. Federal employees are required to create proper documentation of their work, and your organization should follow suit. This means setting up clear guidelines for organizing and electronically storing records. Any copies kept on alternate media must be accurate and clear representations of the originals.

Avoiding Retention Pitfalls

It’s not just about keeping records – it’s also about disposing of them correctly when the time comes. Adhering to disposition instructions and agency policies for record destruction is a crucial but often overlooked step. Records should be well-organized and easily accessible to authorized personnel, ensuring smooth audits or daily operations. To make sure everyone’s on the same page, integrate records management training into your team’s routine.

6. Missing Standard Operating Procedures (SOPs) for Documentation

When clear SOPs are absent, employees often interpret GSA record-keeping requirements in their own ways. This inconsistency can lead to serious compliance issues. Without a unified approach, problems like incorrect contract modifications, outdated pricing, disorganized invoicing, and inaccurate sales reporting can quickly arise.

SOPs act as a safety net, ensuring that tasks are performed consistently and correctly. They take the guesswork out of processes, reducing the risk of costly mistakes. Beyond that, standardized procedures are essential for staying compliant and avoiding contract violations in critical areas.

Building Effective GSA Documentation SOPs

SOPs should be practical and written with end-users in mind, not just for management approval. Use straightforward, step-by-step instructions that leave no room for misinterpretation. Be cautious with words like "may", "must", and "should", as they carry specific legal implications in federal contracting.

Every SOP should include these critical components:

Start by targeting high-priority areas. For example, create SOPs for managing Order Level Materials (OLMs), including steps for retrieving quotes and maintaining records for OLMs that exceed the Simplified Acquisition Threshold. Additionally, develop a compliance checklist to cover key requirements like labeling, tracking, and documentation standards.

Implementation and Maintenance

Once your SOPs are in place, focus on training your team. Use workshops, one-on-one sessions, or e-learning modules to ensure everyone understands their responsibilities within the SOP framework.

Regular updates are essential. Test and revise your SOPs as needed to keep them relevant and effective. Use an Electronic Data Management System to distribute updated versions promptly, and require employees to acknowledge receipt and understanding.

In September 2022, the U.S. Department of Defense set a strong example by establishing standardized SOPs for their Records and Information Management program. These guidelines help Designated Federal Officers and committee staff clearly understand their roles in creating, maintaining, and archiving federal records. The framework also includes instructions for developing file plans and conducting training.

To ensure long-term compliance, conduct regular internal audits. These audits can help identify non-compliance issues, improve processes, and enhance overall efficiency.

7. Slow or Incomplete Responses to GSA Contracting Officers

When GSA contracting officers reach out with questions, requests for information, or clarifications, how you respond can directly impact your contract relationship. Delays or incomplete answers can stall decision-making and lead to costly disputes.

Ineffective communication can cause delays in contract administration, disrupt project timelines, slow down payment processing, and strain relationships where smooth collaboration is essential. For instance, in January 2025, Tillit Law PLLC highlighted a case (ASBCA 63325) where delayed responses escalated to formal legal proceedings, underscoring the severe consequences of communication breakdowns.

"The CO’s final decision on a claim is a good indicator of the government’s position and basis for denial. It is also the parties’ last chance to avoid appeals litigation."

Building a Responsive Communication System

To avoid these pitfalls, put a responsive communication system in place. Use alerts to monitor incoming messages and create internal protocols to ensure every inquiry gets addressed promptly. Having pre-prepared templates and key documents ready can help you respond quickly without sacrificing quality.

Timeliness and clarity are essential. Contracting officers often manage multiple contracts and face numerous administrative challenges. Maintaining professionalism and a positive tone – even in frustrating situations – can go a long way toward building trust and cooperation.

Pay close attention to instructions. Review them carefully and seek clarification immediately if anything is unclear. An incomplete or delayed response can create unnecessary complications.

Establishing Clear Communication Protocols

Beyond responsiveness, clear communication protocols ensure your team consistently meets GSA requirements. These protocols might include identifying preferred communication channels, setting specific response times, and establishing escalation procedures for urgent matters. Such measures help your organization maintain effective communication and avoid missteps.

Documenting all communications is equally important. Even during periods of limited interaction, detailed records demonstrate your commitment to compliance and can serve as valuable evidence if disputes arise.

Building strong relationships with contracting officers also provides an advantage. Regularly check in to stay updated on potential opportunities and share any insights or resources that might benefit their agencies. However, always adhere to proper communication etiquette and avoid actions that could compromise fair competition or create ethical concerns.

Finally, consider using proposal management or CRM tools to track correspondence and set follow-up reminders. These systems can help you maintain a complete record of all interactions, ensuring nothing slips through the cracks.

Comparison Table

The seven record-keeping mistakes discussed earlier each bring their own set of compliance risks and potential financial setbacks. To effectively prioritize compliance efforts, it’s crucial to understand how these issues differ in impact and severity.

This table highlights where compliance risks and financial exposure are most concentrated. With the GSA Schedule market valued at over $45 billion annually, maintaining compliance is essential to staying competitive. Research indicates that nearly 20% of GSA contracts reviewed show pricing discrepancies, underscoring how widespread these issues are.

Among these mistakes, record retention problems stand out as the most severe. Without proper documentation, even small errors can spiral into significant compliance violations during audits.

Sales reporting errors, on the other hand, can immediately draw GSA oversight. The Office of Inspector General (OIG) emphasizes this in its findings:

"The OIG has flagged CSP issues as a top finding in GSA contract audits. Avoiding this starts with clean internal records and proactive transparency."

While delayed communication with contracting officers may seem less critical, it often compounds existing compliance issues. Poor responsiveness can lead to heightened scrutiny in other areas.

The financial repercussions of non-compliance are substantial. For example, in March 2023, a technology company lost a lucrative GSA contract after failing to disclose a 15% discount offered to a commercial client, violating the MFC policy. Similarly, a construction services firm faced contract termination when an audit revealed stagnant pricing over five years, despite significant market changes. These cases illustrate how costly even seemingly minor compliance lapses can be.

Conclusion

Keeping accurate and organized records for your GSA contract is about more than just staying compliant – it’s a critical step in securing your business’s future in federal contracting. The seven mistakes discussed earlier can turn promising opportunities into costly setbacks, with issues like audits, pricing disputes, and penalties of 0.75% of your GSA contract sales looming over poor record-keeping practices.

As the PSI Team emphasized, staying compliant and competitive requires a proactive approach. This means putting robust document retention policies in place, performing regular internal audits, and maintaining detailed logs of all transactions, modifications, and communications tied to your GSA contract. These practices not only shield your business from potential risks but also foster the level of transparency and trust that government agencies expect.

If you’re looking for expert support, GSA Focus offers tailored services to help small businesses secure and manage GSA Schedule Contracts. From document preparation to compliance assurance and negotiation, their team has a proven track record – with a 98% success rate – to help you sidestep common pitfalls and strengthen your position in federal contracting.

FAQs

What problems can GSA contractors face from poor record-keeping, and how can they prevent them?

Poor record-keeping can lead to serious consequences, including disallowed costs, legal penalties, contract cancellations, fines, and even harm to your business’s reputation. These risks often stem from failing to comply with federal record-keeping standards or neglecting critical compliance requirements.

To steer clear of these pitfalls, consider the following steps:

• Adhere to federal record-keeping guidelines and retention schedules to ensure compliance.
• Leverage reliable digital tools to efficiently organize and manage your records.
• Conduct regular audits to verify the accuracy and compliance of your documentation.

By staying organized and proactive, GSA contractors can safeguard their contracts and maintain a positive relationship with federal agencies.

What steps can GSA contractors take to ensure accurate sales reporting and avoid penalties?

To keep your sales reporting accurate and avoid penalties, GSA contractors need to prioritize timely submissions and well-organized record-keeping. Make use of the FAS Sales Reporting Portal (SRP) to submit sales regularly, and double-check all data for accuracy before sending it in. Keeping detailed and clear sales records is essential, along with following GSA’s compliance guidelines.

Incorporating these habits into your routine can help minimize mistakes, reduce the chances of audits, and avoid potential penalties, all while ensuring you meet GSA requirements.

How can I improve communication with GSA Contracting Officers to avoid delays in managing my contract?

To ensure smooth collaboration with GSA Contracting Officers and avoid unnecessary delays, it’s crucial to set up clear and reliable communication channels right from the beginning. Make it a priority to respond to their questions and notices quickly and ensure you fully grasp the key deadlines and expectations tied to your contract. Stay on top of any updates or changes to the contract requirements by checking regularly. Keeping communication open and addressing potential concerns early can make the entire process more efficient and help sidestep avoidable setbacks.

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• Common GSA Audit Issues and How to Avoid Them
• 5 Financial Risks in GSA Contracts (and How to Avoid Them)