The government said Tuesday it will not renew a contract with Titan Corp. (TTN) to provide up to $250 million worth of counseling services for soldiers and their families, citing concerns raised in an audit.

The San Diego-based security and defense information company was given the job of setting up a 24-hour counseling service to help solve a range of problems — from finding a mechanic to marital strife.

The contract, awarded last August and paid for initially out of emergency funds appropriated by Congress for the war in Iraq (search), was good for one year, with an option for four more.

The General Services Administration (search), which awarded the contract on behalf of the Department of Defense (search), will allow the deal to lapse next month, a GSA spokesman said Tuesday.

The GSA cited concerns raised by its own inspector general in an ongoing audit of the Titan contract and others.

"We've had concerns with the way the contract was being used," spokesman Jack Lebo said. He said he could not be more specific until the audit was finished by the end of September.

Titan spokesman Wil Williams said the company has not been notified of the GSA's decision. He declined further comment.

It's the latest setback for Titan, which is also under investigation for allegedly bribing overseas officials. The ongoing probe led Lockheed Martin (LMT) to pull out of a deal to buy Titan for $1.66 billion last month.

The contract was worth between $220 million and $250 million over five years. Titan has billed the GSA slightly more than $13 million for 10 months of work, said spokeswoman Mary Alice Johnson. Titan reported revenues of to $1.78 billion last year.

Under its GSA contract, Titan was responsible for the technical work; a subcontractor, Minneapolis-based Ceridian Corp., took care of the consulting.

The GSA decided there should be separate contracts for consulting and information technology, Johnson said.

Ceridian did not return a message seeking comment.