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National 8(a)2016
Winter Conference
DCAA
2016
Initiat i ves
Agenda
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DCAA Responsibility
What DCAA has been doing
What is their plan for 2016
What can you do to prepare
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DCAA
2016
Initiat i ves
DCAA Responsibilities
Pre-award Contract Services
Post-award Contract Services
• Accounting System Surveys
• Incurred Cost Audits
• Proposal Audits
• CAS (Cost Accounting Standards)
• Forward Pricing Rate Proposals
• Claims and Terminations
• Voucher audits
Business System Audits
• Accounting and Billing
• Estimating
• Material Management
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DCAA
2016
Initiat i ves
What has DCAA been doing?
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Proposal / Demand Work
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Accounting System Audits
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Incurred Cost Proposal (ICP) Audits
They are Seriously Behind on Other Responsibilities
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DCAA
2016
Initiat i ves
What is DCAA’s Plan for 2016?
New Focus
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Floor Checks
Business Systems - Estimating System and Material Management (MMAS) reviews
CAS - Disclosure Statement audits
Post award (defective pricing) audits
Provisional billing rates
Continued Activity
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Demand work - proposal audits and forward pricing rates
Incurred costs audits
Billings
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New Audit
Focus
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D C A A
2 0 1 6
I n i t i a t i v e s
What can you do?
Floor Checks
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Be prepared – Select your escort team and train
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Perform your own floor checks, identify problems
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Review you written policy, are you actually complying with it
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Train and Train and Train
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Escorts should document potential interview problems. Be proactive and resolve
miscommunications with the auditor
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D C A A
2 0 1 6
I n i t i a t i v e s
What can you do?
Estimating System Reviews
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Perform a self assessment
• Review DFARS 252.215-7002 and audit guidance
• Review your estimating manual
• Compare manual to requirements
• Test actual proposals for compliance with your written policy
• Take corrective action
Train employees who administer the system
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Manage the audit, maintain copy of records provided to the auditor
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D C A A
2 0 1 6
I n i t i a t i v e s
What can you do?
Material Management System Reviews (MMAS)
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Perform a self assessment
• Is material a significant element of cost
• Review DFARS 252.242-7004 and audit guidance
• Review your written policies for compliance
• Perform a walk through of your system and test for compliance with
your written policy
Take corrective action
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Manage the audit
Don’t wait until you are selected for audit, start your review now!
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DCAA
2016
Initiat i ves
What can you do?
CAS (Cost Accounting Standards) Audits
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Confirm your CAS coverage status
• Are you a small business
• Review your contracts – not all contracts have CAS clauses
• Do you have a requirement for a Disclosure Statement
Audit focus – Unaudited contractor submitted Disclosure Statement
modifications. Do you have any?
Review for adequacy, do they describe your actual practice
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D C A A
2 0 1 6
I n i t i a t i v e s
What can you do?
Post Award (defective pricing) Audits
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Know what defective pricing is
• Did you provide current, accurate and complete information
• Were you required to submit cost or pricing data and certify
Carefully analyze the contract selected for audit to insure that it is
subject to TINA
Do you know what information was provided
• Locate the records
• Are the individuals certifying knowledgeable
• Do you have a sweep process in place
If DCAA has findings, do they meet the standard for defective pricing
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DCAA
2016
Initiat i ves
What can you do?
Provisional Billing Rates
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Submit annual provisional billing rates (PBRs) at the beginning of your
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• DCAA is no longer accepting “same as last year”
• Untimely submission will likely delay payment
Ensure indirect rate forecast supports PBRs
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Continued Audit
Activity
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D C A A
2 0 1 6
I n i t i a t i v e s
What can you do?
Proposal Audits
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Carefully review the solicitation for all proposal requirements
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Use the Proposal Adequacy Checklist (DFARS 252.215-7009) to test your proposal
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Have a system to maintain records used to support proposals
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Assign a point-of-contact for proposal audit
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DCAA
2016
Initiat i ves
What can you do?
Incurred Cost Audits
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Use the DCAA ICP adequacy checklist to review the ICP before
submission
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Manage the audit
• Entrance conference to discuss expectations
• Assign a single point of contact for timely responses
• Keep a record of all DCAA request and information provided
• Resolve open items and issues before the audit is finalized
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Questions?
Let’s Talk.
Contact:
Patricia J. Mensch, CPA, CGFM, CGMA
Partner, Government Contract Consulting
pmensch@mgocpa.com
P: 858.792.2210
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