DCAA Takes More Scrutiny from Congress as Incurred Cost Audit Backlog Increases
Congressional scrutiny of the Defense Contract Audit Agency (DCAA) continues. For the last two+ years Congress and the GAO had DCAA under the microscope for its audit quality and its immense backlog of incurred cost audits. This trend continued on February 1, 2011, as the Senate Subcommittee on Contracting Oversight prodded the DCAA to finish more incurred cost audits and decrease its backlog. DCAA’s Director, Patrick Fitzgerald, stated that the backlog of incurred cost audits has quadrupled over the last 10 years, and it was noted that DCAA conducted $34 billion in incurred cost audits in FY 2010, while just two years earlier, DCAA conducted $138 billion in incurred cost audits in FY 2008. This decrease in the dollar amount of the audits completed, and resulting increase in the audit backlog, coincided with DCAA increasing their labor force by 500 new auditors over the last two years. Meanwhile contractors are waiting longer to close-out contracts and are unable to complete contract final billings for extended periods of time. Continue reading »
Prepare for a Decrease in DCAA Audits Thanks to New DoD Standards
The Department of Defense (DoD) announced on October 18, 2010 that as a part of their efforts to appropriately align DCAA audit resources, the DoD was increasing the limit imposed for contracting officers’ to request DCAA audit assistance to Fixed-Price proposals exceeding $10 million and Cost-Type proposals exceeding $100 million. Auditors will complete all in-process price proposal audits that are below the revised thresholds. The revisions of the Procedures, Guidance and Information (PGI) does not impact the requirement for cost or pricing data as that threshold remains at $700,000 as of October 1, 2010.
DCAA Updates the Contract Audit Manual — Changed Sections Require Continued Compliance
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: Continue reading »
Getting out of Gridlock – Resolving Contract Audit Recommendations
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, Continue reading »
Independent Contractor or Employees? Encore free Webinar 6/17/10; Construction Industry Article!
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
Deltek CEO Kevin Parker Has His Finger on the Pulse with Aronson
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!
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 |
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| 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?
A Handy Guide to Navigate the Maze of DCAA
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
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?
Accounting For Government Contractors – Free Breakfast Briefing 2/24/10
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: Continue reading »
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What We Are Writing
- A Marriage of Inconvenience: GSA Schedule Contracts & The Contractor Code of Business Ethics & Conduct Clause
- Emerging Small Businesses: To Grow Your Business, You Must Plan For Growth
- Government Contracting: Look Before You Leap!
- GSA Schedules – Strategies for Success
- New Employee vs. Independent Contractor Considerations
- Pay on Display – Understanding the Executive Compensation and Subcontractor Data Reporting Requirements & Ramifications
- The GSA Schedule: Your Ticket to the Federal Market (May 2010)
- The New FAR Codes of Conduct and Compliance Program Provisions
- The Seven Deadly Sins (of contract compliance)