There has been a trend in the last 5 years that the DCAA is auditing fewer of the annual Incurred Cost Proposals (ICP's). This is based on the shear backlog as well as the risk factor to the government. Small firms are less risk and therefore fewer of their ICP's are being audited. As we all learned in physics class, for every action there is an equal and opposite reaction. In this case it looks like the reaction means there will be much more scrutiny on invoices and vouchers. We have learned that there has been a recent DCAA wide training relative to how to monitor vouchers and scrutinize them more closely. We have noticed that this is translating into more requests from auditors relative to the vouchers than ever before. Good advice to contractors at this point is to scrutinize the invoice thoroughly prior to submitting it. Math errors will raise a red flag and draw attention. This attention could then uncover other issues. Not only are math errors red flag warnings, but wrong attachments or incomplete attachments can cause a flag to go up. Also, carefully check calculations to make sure they are correct and have the proper basis.Read More
DCAA Compliance Blog
Your Source for DCAA & FAR Compliance News and Discussion
ReliAscent® LLC is the only government contract accounting firm that specializes in all aspects of government contracting compliance. From our DCAA compliant accounting services, to monthly government contract accounting for all government agency awards, contract management & administration, and financial services & planning, our goal is to ensure the success of our clients, and all small business government contractors and grantees.
In our DCAA Blog, we discuss the latest government contracting news from the Federal Government, the DCAA, and DCMA, as well as promotions offered by ReliAscent, and helpful tools and resources for contractors.
We hope you will visit and take part in the discussions on our blog on a regular basis. If you ever have any questions or would like to discuss how our experts can help, do not hesitate to contact us at any time!
Over the last couple of years the DCAA has increased it's focus on auditing Incurred Cost Proposals. This has resulted in some companies getting involved with the DCAA auditing ICP's as much as 6 or 7 years old. I don't know about you but I have a hard time remembering last week, let alone 6 years ago. This certainly causes a problem in contract close-outs since the ICP must be accepted in order to true up the indirect billing rates on a cost type contract. There are some new directives that may help relieve some of this situation for the small business.