Report Materials
EXECUTIVE SUMMARY:
The objective of our review was to determine the allowability of the Supplemental Executive Retirement Plan (SERP) costs claimed by First Cost Service Options (FCSO) for Medicare reimbursement for fiscal years (FYs) 2003–2005. We found that FCSO claimed unallowable SERP costs for FYs 2003–2005. During this period, the allowable SERP costs were $332,880. However, FCSO claimed SERP costs of $414,300 for Medicare reimbursement. FCSO did not claim SERP costs in accordance with the Federal Acquisition Regulations (FAR) and the Cost Accounting Standards (CAS). As a result, FCSO claimed $81,420 of unallowable SERP costs. We recommended that FCSO revise its Final Administrative Cost Proposals for FYs 2003–2005 to reduce its claimed SERP costs by $81,420. We also recommend that FCSO claim future SERP costs in accordance with the FAR and the CAS. In written comments on our draft report report, FCSO disagreed with the compensation benchmarks used in our calculations to establish and limit the reasonableness of SERP costs. However, FCSO stated that it would revise claims for FYs 2003–2005 to reduce claimed SERP costs by $81,420.
Notice
This report may be subject to section 5274 of the National Defense Authorization Act Fiscal Year 2023, 117 Pub. L. 263.