Author Archive

Getting out of Gridlock – Resolving Contract Audit Recommendations

Monday, August 2nd, 2010

To keep the process moving forward as quickly as possible and to obtain resolution at the lowest levels possible, the Department of Defense Procurement and Acquisition Policy (DPAP) issued a memorandum on resolving contract audit recommendations in December 2009;  these procedures were furthered clarified in May 2010.

The DPAP memorandum dictates, when the contracting officer has a basis for disagreement with the audit findings, the contracting officer should first attempt to resolve the issues and recommendations identified with the DCAA auditor.  In such cases, (more…)

Live from Deltek Insight 2010 – Find Your Prescription for Success! Part II

Friday, May 21st, 2010

The 2010 Deltek Insight conference was another huge success for all participants.  Deltek’s President and CEO Kevin Parker stopped by the Aronson booth to check out our live Insight blogging and to monitor the “pulse” on Deltek customers’ needs and satisfaction.  The  exchange of ideas, input from users, and new product development  really kept  up  momentum through the end of the conference.

Aronson’s accounting and technology experts Jan Zall, Linda Riesenman, and Nicole Mitchell conducted popular breakout sessions attracting over 300Deltek users  The topics presented included; “Multiple Companies and CostPoint” by Jan Zall , “Surviving DCAA Audits with GCS Premier” by Nicole Mitchell, and “Strategies for Merging Multiple CostPoint Databases” by Linda Riesenman.   The attendees had positive feedback on the sessions and asked informative questions related to the topics.  Feedback focused mainly on the use of technology to increase efficiency and for obtaining accurate timely data to address the compliance requirements heightened by the current administration emphasis on transparency.

Aronson proved to be the “Cure” for government contractors needs.  Aronson again demonstrated our expertise in the areas of systems, compliance, contract administration, GSA Schedule support, assurance, tax, and M&A; truly full service advisors to Federal contractors.

We hope to see you all next year and to meet even more new faces in Nashville, TN, for Insight 2011.  If you missed the conference and would like your own Aronson “diagnosis and prescription” contact Tom Williams at (301) 222-8289 or twilliams@aronsoncompany.com.

A Handy Guide to Navigate the Maze of DCAA

Wednesday, March 10th, 2010

Do you ever feel that dealing with DCAA is like walking through an enormous maze? Once you complete an audit you feel a sense of victory and you vow to NEVER step back into the maze again. Well here is a great resource, published by the seemingly last place you would think to look for assistance www.dcaa.mil- DCAA’s “Information Guide for Contractors”. Although the guide was published in 2005 it still proves to be a great resource today. This guide will help you navigate the maze to be prepared for your next audit.

The guide is designed to address compliance requirements in terms easily understood by contractors and removes a lot of the “legal” language of the Federal Acquisition Regulations. The Information guides the contractors through key areas and identifies DCAA’s major areas of emphasis: Internal Control Systems; Management Policies; Accuracy and Reasonableness of cost representations; Financial Capabilities; and Contractors compliance with contractual provisions.

The most informative chapter for a basic review of government contracting is Chapter 2 Pre-award Surveys of Prospective Contractor Accounting Systems. Take a moment to review the information before your next accounting system review.

Contact Nicole Mitchell (301) 222-8231, nmitchell@aronsoncompany.com the next time you need assistance navigating the maze of DCAA.

Accounting For Government Contractors – Free Breakfast Briefing 2/24/10

Monday, February 8th, 2010

Failure to maintain an adequate accounting system may preclude a contractor from award of a federal contract.  Your next government contract award, as a prime or sub, may be dependent on having a compliant accounting system and small businesses are NOT exempt.  Don’t waste your valuable time and money submitting proposals in pursuit of government contracts if your accounting system isn’t “ready for prime time.”

Join Aronson & Company’s Nicole Mitchell for a complimentary breakfast briefing on February 24th where she will guide you through the world of accounting for federal contracts. Attendees will get a look at basic accounting requirements for federal contractors and what you can expect from an audit. Topics will include: (more…)

DOD Contractor Compliance Crackdown! Payments Could Be Withheld Up to 50%

Tuesday, January 19th, 2010

A proposed rule released by the Department of Defense (DoD) on January 15, 2010 will provide contracting officers the authority to withhold payments on cost reimbursable type and time and materials type contracts as a response to address business system deficiencies.  The draft rule adds a clause to contracts requiring contractors to certify that they have no major defects in their contractor business systems defined as: accounting systems, estimating systems, purchasing systems (CPS), earned value management systems (EVMS), material management and accounting systems (MMAS), and property management systems. This DoD’s proposal to amend the Defense Federal Acquisition Regulation Supplement (DFARS), continues the crack-down on contractors increasing regulations and potential penalties for contractors with deficient business systems.

The draft rule identifies contractor business systems and internal controls as the first line of defense against waste, fraud, and abuse of tax dollars. The objective of the rule is to improve the effectiveness of Defense Contract Management Agency (DCMA) and Defense Contract Audit Agency (DCAA) oversight of contractor business systems. The requirements of the rule will apply to entities contractually required to maintain one or more of the defined contractor business systems listed above. If deficiencies are identified in the systems and the contractor does not implement corrective action within 45 days, the proposed rule allows contracting officers to withhold up to 10% of each of the Contractor’s payments on cost reimbursement, time and materials, and labor hour type contracts for each system up to a maximum of 50%. (more…)

Resolution #1: We Will Avoid Jeopardizing Contract Awards by Getting Our Accounting System Approval–Ready

Monday, January 4th, 2010

Valuable time and money are spent submitting proposals in pursuit of Government contracts.  Those $s may be wasted if your accounting system isn’t “ready for prime time”.  Your next government contract award, as a prime or sub, may be dependent on having a compliant accounting system.  And, small businesses are NOT exempt. Many contractor system requirements are triggered based on the size of a contractor; BUT the requirement for an approved accounting system considers the type of contract awarded, not contractor size. The issuance of time and materials and cost reimbursement contracts typically require contractors to meet prescribed accounting system requirements such as DCAA’s “Preaward Survey of Prospective Contractor Accounting System” (SF 1408).

Don’t miss out on contract awards! Make sure your accounting system adequately performs the following required elements! (more…)

DCAA Audit Director, April Stephenson, Reassigned

Tuesday, October 27th, 2009

On October 26, 2009, the Associated Press reported “The Pentagon’s chief auditor was forced from her post Monday following sharp criticism from lawmakers over failures to hold defense contractors accountable for overcharges and poor performance.”

Robert Hale, Pentagon comptroller, announced Patrick Fitzgerald, Director of the Army Audit Agency to replace Stephenson on November 9, 2009. Hale told DCAA’s employees that Fitzgerald “has an excellent reputation as a successful manager of a large, geographically diverse audit organization. … I believe that Mr. Fitzgerald is particularly well qualified to guide DCAA during this period.” Fitzgerald brings to the position over 30 years of audit experience and has also been heading the oversight committee created by Hale to monitor DCAA. (more…)

DCAA Issues Criteria for Adequate Proposal Pricing

Tuesday, October 13th, 2009

DCAA released a great tool to assess the adequacy of your proposal pricing - available at http://www.dcaa.mil/Adequacy.pdf. A well supported cost proposal reduces effort needed for review and facilitates negotiations. Reviewing your pricing and following the DCAA established criteria for adequacy is a benefit to all!  Aronson & Company advises companies on all government contract, proposal pricing and compliance-related issues, contact Nicole Mitchell (301) 222-8231, nmitchell@aronsoncompany.comor Thomas Marcinko (301) 231-6237, tmarcinko@aronsoncompany.com.

Accounting Seminar for Government Contractors – GCI Oct 27, 2009

Friday, October 9th, 2009

The Howard County Economic Development Authority’s Center for Business and Technology Development, in partnership with TargetGov, presents the Government Contracting Institute seminar Class 601: Accounting for Government Contractors on Tuesday, October 27, 2009, 8:30 a.m. – 12 noon.  Other seminars critical for governments contractors are available at the registration site.

Government contracting requires very specific setup, systems, reports, processes and tracking. Join Jim Fennel and Nicole Mitchell of Aronson & Company to understand government cost accounting standards, pricing strategies, discussion of software applications including QuickBooks and other alternatives and audit preparation.  Who should attend?  Accountants, CPAs, bookkeepers, CFOs, and any business owner who wants to win government contracts, be profitable and satisfy all federal accounting requirements.
Registration Deadline: October 13, 2009. Join Jim Fennel and Nicole Mitchell of Aronson & Company Pre-registration is required.

Location:
The Center for Business and Technology
9250 Bendix Road, North
Columbia , MD 21045

For more information, please contact:
Tasha Taylor
Ph: 410-313-6550
Em: ttaylor@hceda.org

DCAA Audits – Deficient once Again

Wednesday, September 30th, 2009

The latest report on DCAA by the General Accounting Office (GAO) released September 2009 entitled “Widespread Problems with Audit Quality Require Significant Reform” marks an embarrassing moment for DCAA. The GAO found audit quality problems at DCAA offices nationwide including; compromise of auditor independence, insufficient audit testing, and inadequate planning and supervision.Here are just a few of the highlights:

• DCAA auditors spent 530 hours to support an audit of a non-existent billing system and reported adequate controls
• On another billing system audit an auditor told GAO he did not perform detailed tests because “the contractor would not appreciate it”
• On an accounting system audit, the supervisory auditors directed audit staff to delete some audit documents, generate others, and in one case, copy the signature of a prior supervisor onto new documents making it appear that the prior supervisor had approved a revised risk assessment. The supervisor who approved the altered documents was later promoted.

In total DCAA rescinded 80 audits cited in the last two GAO reports. (more…)