What action should a contracting officer take when there are unliquidated progress payments?

When dealing with unliquidated progress payments, the contracting officer should adjust the liquidation rate. This action is crucial because unliquidated progress payments indicate that the amount already paid to the contractor exceeds the work that has been completed and accepted. By adjusting the liquidation rate, the contracting officer can ensure that future payments are more closely aligned with the actual progress made on the contract. This helps in maintaining proper control over contract funds and mitigating the financial risk to the government, ensuring that payments reflect the value of work completed.

Adjusting the liquidation rate is an effective way to manage cash flow and ensure that the contractor is incentivized to complete the remaining work while minimizing the potential for overpayment based on incomplete or unsatisfactory progress. This action aligns with good fiscal management and accountability in government contracting practices.