The Changing Contract Audit Landscape

DCAA’s Auditing More than ICS & Proposals?

Over the last few years, we have often written on the changing landscape of contractor business system audits.  Specifically, the fact that the DCAA has invested considerable resources into the audit of incurred cost proposals and proposals for most of the past decade, which has led to an inability to routinely audit contractor business systems, conduct routine post-award (TINA) defective pricing audits and other audits that should be a routine part of doing business with the government in a flexibly-priced environment.  The change in audit focus has been apparent since the end of 2018, but we are just now starting to see the true impact of the Agency’s adaptation to an audit world without a large volume of incurred cost audits. 

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Topics: DFARS Business Systems, DCAA Audit Support

Indirect Cost Basics for Government Contractors

FAR Subpart 2.1, Definitions, provides the meaning of two general groupings of cost not assignable directly to final cost objectives (i.e., not a direct contract cost):

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Topics: Contracts & Subcontracts Administration, DCAA Audit Support

UPDATE: New SBA FAQs on PPP Loans – Repay Date Extended to May 18

SBA Extends the Repayment Date Again – May 18, 2020

On May 13th the Small Business Administration (SBA) updated its Frequently Asked Questioned (FAQs) – adding Questions 46 and 47.  Question 47 extends the safe harbor (repayment) date to May 18th.  Question 46 is very interesting; it lays out the SBA and Department of Treasury plan to review certifications of the necessity of the loans. 

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Topics: Small Business Compliance, DCAA Audit Support, COVID-19, Paycheck Protection Program (PPP) Loans

Government Contractor Estimating System Requirements and Audits

The FAR establishes that when contracting by negotiation with the Government, the contractor should have an acceptable estimating systemFAR 15.407-5 provides that due to the benefits to both the Government and the contractor in reducing the scope of individual proposal reviews at contractors with an acceptable estimating system, the auditor (likely DCAA) should survey the system and provide a report to all contracting offices and contract administration offices doing substantial pricing activity with the contractor.  This is a very open-ended requirement/expectation; therefore, DoD established a structure in the DFARS.

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Topics: Contracts & Subcontracts Administration, DFARS Business Systems, DCAA Audit Support, Estimating System Compliance

Successfully Navigate Estimating System Audits for Government Contractors

With a renewed focus on DCAA Estimating System Audits, we share some advice on successfully navigating the process.

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Topics: DFARS Business Systems, DCAA Audit Support, Estimating System Compliance

DCAA Audits Won’t Stop During Coronavirus Restrictions

For those of you who may have thought there could be a silver lining to coronavirus restrictions from reduced audit effort, think again! Actual postponement of audits will be rare.

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Topics: DCAA Audit Support, COVID-19

UPDATE: The Rocky Road to COVID-19 Relief – Treasury Looking for Audits

UPDATE:  On May 5th, SBA added FAQ #43 extending the safe harbor to May 14, 2020 and stating “SBA intends to provide additional guidance on how it will review the certification prior to May 14, 2020.

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Topics: DCAA Audit Support, COVID-19

Who is my Government Official Over Cost Issues?

In days gone by, knowing which contract administration office you needed to work with was as easy as finding your local Defense Contract Management Agency (DCMA) Office.  DCMA used to accept and administrate pretty much all contracts, even other Federal Agencies with reimbursement of its services (e.g., NASA contracts).  This is no longer the case; Over the last few years, DCMA has made a significant effort to stay focused on what it refers to as its core business – basically research, development, engineering, test, production, and spares for major acquisition programs.  This leaves the administration of low value/low risk contracts, management and professional services contracts, architect-engineer services contracts, and many others to the buying command that issued them.

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Topics: Contracts & Subcontracts Administration, DCAA Audit Support

DCAA Embraces “Virtual Auditing” to Help Keep Auditors and Contractor Compliance Personnel Employed During COVID-19 Pandemic

Although the COVID-19 Pandemic and its impact on everyone is absolutely serious business, the nature of this “special day” blog is not necessarily serious business.   At times like these we hope that an element of levity will be accepted for what it is and not be misinterpreted as diminishing the serious nature of the pandemic. We also hope that everyone reading this is safe, healthy and adhering to the federal guidelines to limit the spread of COVID-19.

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Topics: Redstone GCI, DCAA Audit Support, COVID-19

Limitation of Cost or Funds – The Burden Falls on You

UPDATED – June 18, 2024

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Topics: Compliant Accounting Infrastructure, Incurred Cost Proposal Submission (ICP/ICE), Contracts & Subcontracts Administration, DCAA Audit Support, Federal Acquisition Regulation (FAR)