Posts Tagged ‘audit’

DCAA Updates the Contract Audit Manual — Changed Sections Require Continued Compliance

Wednesday, September 8th, 2010

DCAA has updated sections of the Contract Audit Manual (CAM) through September 1, 2010.  The CAM provides technical assistance and procedures that are followed by the DCAA, for audits of government contractors. The CAM is available to assist contractors with requirements and procedures that should be implemented to meet DCAA audit standards.  The following areas of the CAM have changed: (more…)

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…)

Independent Contractor or Employees? Encore free Webinar 6/17/10; Construction Industry Article!

Wednesday, June 2nd, 2010

On June 17th, Aronson will offer our popular free seminar “Independent Contractor or Employee: Classification is the Elephant in the Room!“  focused on the issue of worker classification.  This is one of those tricky compliance issues that everybody knows about, but nobody wants to talk about. With more and more states passing legislation to penalize employers who misclassify workers, audits are a valid concern for all businesses. Don’t be intimidated by this important topic – instead, be informed! Join Aronson & Company and FosterThomas for this insightful event on June 17th at FosterThomas’ Corporate Office that addresses how your company can prepare for audits and reduce liability.

Interested in the specific impact on the construction industry?  See recently republished article,  “New Employee vs. Independent Contractor Considerations – What You Need to Know Today and for the Future“  by Tim Cummins, Officer of Aronson and Company’s Construction Industry Services. This article was republished in the March 2010 edition of the Washington Building Congress (WBC) Bulletin available for download via the following link: https://www.wbcnet.org/Bulletin/Bulletin-March-2010-FNL.pdf.

Don’t forget, on June 17th, Aronson & Company’s tax experts will help you gain an understanding of the issue, the costs to your business of noncompliance, and steps you can take toward compliance. Seats are limited, so register today!

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.

Encore Seminar on 5/13! Independent Contractor or Employee: Classification is the Elephant in the Room!

Friday, April 16th, 2010

Worker classification is one of those tricky compliance issues that everybody knows about, but nobody wants to talk about. With more and more states passing legislation to penalize employers who misclassify workers, audits are a valid concern for all businesses. Don’t be intimidated by this important topic – instead, be informed! Join Aronson & Company and Helios HR for this encore event on May 13th at the Tower Club that addresses how your company can prepare for audits and reduce liability.

Additional information and FREE registration is available via the following link:

Starts:	Thursday May 13, 2010, 08:00AM
Ends:	Thursday May 13, 2010, 10:30AM
Event Type:	Training/Seminar
Location:	The Tower Club 8000 Towers Crescent Dr #1700 Vienna, VA 22182 US
Price:	Complimentary
Website:	http://www.aronsoncompany.com/events/events-calendar/icalrepeat.detail/2010/05/13/41/33|32|28|30|27/OTFjZTI1ZmRmMjRkMjAzM2U1OGE0OTQyNDk3YTVlMzk=.html
Industry:	accounting
Keywords:	Independent contractor misclassification; Worker misclassification; IRS
Intended For:	HR Managers, CEOS, CFOS
Organization:	Aronson & Company and Helios HR

Did you know that:

• The IRS has begun randomly selecting 2,000 taxpayers each year for the next three years for a comprehensive employment tax law compliance audit?
• Independent contractor misclassification is now more likely than ever before to result in heavy fines and penalties?
• Worker misclassification invites trouble with the IRS, Department of Labor, and state and local governments?
• All companies are vulnerable, but construction and government contracting businesses are being targeted in particular?

(more…)

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.

Independent Contractor or Employee: Misclassification Could Be Very Costly! Attend Aronson’s Free Seminar 3/3/10

Monday, February 15th, 2010

Worker classification is one of those tricky compliance issues that everybody knows about, but nobody wants to talk about. With more and more states passing legislation to penalize employers who misclassify workers and independent contractors, audits are a valid concern for all businesses. Don’t be intimidated by this important topic – instead, be informed! Join Aronson & Company on March 3rd for a unique seminar that addresses how your company can prepare for audits and reduce liability.

Did you know that:

• The IRS has begun randomly selecting 2,000 taxpayers each year for the next three years for a comprehensive employment tax law compliance audit?
• Independent contractor misclassification is now more likely than ever before to result in heavy fines and penalties?
• Worker misclassification invites trouble with the IRS, Department of Labor, and state and local governments?
• All companies are vulnerable, but construction and government contracting businesses are being targeted in particular?

(more…)

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…)

Resolution #9: We Will Document Our Bonus Plans

Thursday, January 14th, 2010

Employee bonuses have always been on DCAA’s radar but even more so under current conditions. Contractors are encouraged to not rely on a long standing history of awarding bonuses as a basis for considering it as an allowable cost.
Written bonus plans where the criteria for award are clearly understood by the employees are the best assurance that a contractor has for acceptance of such payments as allowable cost. Today bonuses are expected to be performance related and therefore not generally considered part of the fringe package as in previous years. There is a place in the fringe pool for spot awards, if defined in the bonus plan, however, generally the expense should follow the person being awarded the bonus. Casual/beneficial guidelines would indicate the overhead pool for direct and full time overhead personnel and G&A for employees that generally charge G&A.

Care must be taken to show that the bonus award is determined by performance. This may be as simple as using annual evaluation rating for the rank and file, but more specific criteria would be used for management personnel, specifically something they have control over such as maintaining direct labor, client feedback on performance, maintaining budgets and resulting indirect rates, etc.

Executive bonuses may be more specific and include maintaining financial ratios, achieving new business goals as well as contractor specific goals. Under no circumstances should profit be an evaluation criteria as it might be seen as a distribution of profits and therefore unallowable. Bonuses for owners of the company must be explicitly measurable so as to be allowable and be reasonable.

Contractors are reminded to periodically review the DCAA Contract Audit Manual for current evaluation and audit procedures for all costs recorded on their books.  Still not sure, Aronson can help. For assistance contact Nicole Mitchell at (301) 222-8231 or nmitchell@aronsoncompany.com.

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…)