Redstone Government Consulting Blog | DCAA Audit Support (3)

Implementing the proper human resources information systems (HRIS) brings many benefits to HR teams and the businesses they support. These benefits may include automating processes, efficient talent acquisition, effective employee management, proper time tracking, increased employee engagement, and more. Poor execution of the implementation can create havoc, causing frustration, confusion and a lack of employee engagement. Improper security assignments will cause employees to see the information they shouldn't or managers to be unable to see what they should. In worst cases, employees may not get paid correctly or at all if a system is not setup properly and thoroughly tested. These are just some of the issues that could result from not choosing a partner who is dedicated to knowing your business needs and minimizing the challenges as much as possible. Some complications are expected, but the right partner will find a way to navigate or even avoid them effectively. We utilize the UKG Ready HRIS solution for HR, Payroll, and Timekeeping at Redstone Government Consulting, as we find it can fully meet our clients' needs, not only for our Federal Government Contractor clients but also for any clients looking for a full-suite solution.

Unanet’s project management and general ledger budget features can be an asset when it comes time to develop provisional billing rates for the upcoming year. The information from the project budgets for the upcoming year can provide the data necessary to populate those areas of the general ledger budget so that billing rates can be calculated based on those same assumptions that project managers are using to maintain their project’s performance.

The government can terminate a contract, in whole or in part, through special contract clauses referred to as "termination clauses." Contract termination can happen for reasons such as lack of funding, bid protests, changes in military strategy, technological advancement, federal operations, or national political agenda that change the government's needs. However, what are the different types of termination proposals and forms required? This article will sort out the maze of what needs to be done and submitted.

Current FAR Requirements

Federal Acquisition Regulations (FAR) 42.101 provides that normally, “the Defense Contract Audit Agency (DCAA) is the responsible Government audit agency.” While DCAA’s website states “DCAA provides audit and financial advisory services to DoD and other federal entities responsible for acquisition and contract administration.” DCAA only has appropriated funds to provide services to the Department of Defense (DoD). All other federal agencies must pay for DCAA services. This can make a decision related to the necessity of an audit service a budget-based decision. Today, DCAA is current on the required incurred cost audits of contractors with DoD contracts, but contractors with mostly National Aeronautics and Space Administration (NASA) contracts are years behind in their required incurred cost audits. If, as the FAR states, “DCAA is the responsible Government audit agency,” why is it not a Federal audit agency (dare we say – FCAA)? This would make things much easier for NASA and other federal agencies that need their contracts audited. However, given that this isn’t the case, DCAA is not the only option for federal agencies. Many agencies other than DoD have contracted with third-party CPA firms to get necessary audits performed.

Cost Accounting Standard (CAS) 408 was put in place to provide consistency in the measurement and allocation of vacation, sick leave, holiday, and other compensated personal absences. Today, many contractors refer to all paid time off as “PTO.”

Government regulations can be complex and perhaps even confusing. For those of you experienced in Government contracts and even contract audits, you have heard of the Federal Acquisition Regulation or FAR and, FAR Part 31, Contract Cost Principles and Procedures. The scope of this part describes the applicability of the cost principles and procedures in pricing and accounting for costs on contracts, subcontracts, and modifications whenever cost analysis is needed. There is a lot there, but what’s really important? Well, I will not try to duplicate what can be at least a day course within this blog, but I will highlight three areas that are really important.

Last year, we wrote about the Department of Defense (DoD) proposing a change to the Defense Federal Acquisition Regulation Supplement (DFARS) that would possibly simplify Government property clauses by consolidating four clauses into a single management clause. This became a reality in December 2023 when the DoD issued a final rule consolidating the four clauses into DFARS 252.245-7005, Management and Reporting of Government Property. The new clause had an effective date of January 22, 2024.

If you have Government contracts, you probably heard of the Federal Acquisition Regulation, or FAR, but how much do you know of its parts? Why is it important to know? How could it possibly impact me?

Our friendly DCAA auditors have taken up the government requirement to calculate and publish annually the new compensation cap as provided for in Section 702 of the Bipartisan Budget Act of 2013 (BBA; Pub. L. 113-67), dated December 26, 2013. The 2024 cap amount is $646,000. Below, we have provided the compensation caps going back to 2016.

So, you have a contract with the clause FAR 52.230-2 Cost Accounting Standards, subject to full CAS coverage. If you receive allocations from a home office, the home office must comply with CAS 403, Allocation of home office expenses to segments. A home office has the responsibility for directing or managing two or more segments of an organization and includes intermediate home offices or a corporate office.