Payment for Goods in Advance of Notification of Receipt

The Assistant Administrator, Office of Plans, Program, and Financial Management, Office of the Administrator, General Services Administration (GSA), requested GAO's opinion concerning GSA's practice of paying direct delivery invoices from vendors prior to receiving a notification of receipt of goods from the consignee. While we have previously sanctioned this practice under certain conditions in order to assure prompt payment to vendors, recent events have raised doubts within GSA that this is still an acceptable practice and caused GSA to question whether additional safeguards are required to protect the Government against fraud.