DEMONSTRATION PROGRAM TO IDENTIFY OVERPAYMENTS MADE TO VENDORS.

SEC. 354. DEMONSTRATION PROGRAM TO IDENTIFY OVERPAYMENTS MADE TO VENDORS. (a) In General.— The Secretary of Defense shall conduct a demonstration program to evaluate the feasibility of using private contractors to audit accounting and procurement records of the Department of Defense in order to identify overpayments made to vendors by the Department. The demonstration program shall be conducted for the Defense Logistics Agency and include the Defense Personnel Support Center. (b) Program Requirements.— (1) Under the demonstration program, the Secretary shall, by contract, provide for one or more persons to audit the accounting and procurement records of the 110 STAT. 269Defense Logistics Agency that relate to (at least) fiscal years 1993, 1994, and 1995. The Secretary may enter into more than one contract under the program. (2) A contract under the demonstration program shall require the contractor to use data processing techniques that are generally used in audits of private-sector records similar to the records audited under the contract. (c) Audit Requirements.— In conducting an audit under the demonstration program, a contractor shall compare Department of Defense purchase agreements (and related documents) with invoices submitted by vendors under the purchase agreements. A purpose of the comparison is to identify, in the case of each audited purchase agreement, the following: (1) Any payments to the vendor for costs that are not allowable under the terms of the purchase agreement or by law. (2) Any amounts not deducted from the total amount paid to the vendor under the purchase agreement that should have been deducted from that amount on account of goods and services provided to the vendor by the Department. (3) Duplicate payments. (4) Unauthorized charges. (5) Other discrepancies between the amount paid to the vendor and the amount actually due the vendor under the purchase agreement. (d) Bonus Payment.— To the extent provided for in a contract under the demonstration program, the Secretary may pay the contractor a bonus in addition to any other amount paid for performance of the contract. The amount of such bonus may not exceed the amount that is equal to 25 percent of all amounts recovered by the United States on the basis of information obtained as a result of the audit performed under the contract. Any such bonus shall be paid out of amounts made available pursuant to subsection (e). (e) Availability of Funds.— Of the amount authorized to be appropriated pursuant to section 301(5), not more than $5,000,000 shall be available for the demonstration program.