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Found 10 results

  1. Hello everyone, I'm at a loss trying to figure out how this situation would be handled. Please bear with me as I lay it out: Parent Company A is the parent company to multiple wholly-owned subsidiaries. This scenario involves two; Subsidiary 1 and Subsidiary 2. Subsidiary 1 holds a GWAC that neither Subsidiary 2 or Parent Company A possess in their name. An opportunity is released on said GWAC that Subsidiary 2 would like to pursue. The opportunity requires DCAA audited accounting system, an approved purchasing system, and relevant past performance. Parent Company A holds the approved purchasing system, Subsidiary 1 holds the DCAA audited accounting system, and Subsidiary 2 holds the relevant past performance. Is it compliant to cherry pick the necessary systems from each company all under one blanket entity? Is there any guidance in the FAR aside from 31.205-26(e), which explains cost vs price in intra-company transfers. Hoping there's more info out there other than "its up to the contracting officer". Thanks y'all.
  2. Hi, With the increase in online T&E solutions, has DCAA established additional guideline related to Original Receipts vs. scanned and digital copies, etc. My question is related to 4.703.(c).3 (see below) "The contractor or subcontractor retains the original records for a minimum of one year after imaging to permit periodic validation of the imaging systems." I have delved deep into the internet and have found no guidance. If we meet (c) 1 and 2 then 3. defeats the purpose of reduction of paperwork, time for scanning and maintaining originals, etc. I have been through DCAA audits where the scanned document was accepted because of policies, procedures, internal audit, approvals, etc. were followed. If a company has an expense policy that covers the process, will DCAA waive 3? If DCAA doesn't accept a scan or electronic copy as "original" why should a company use one of the new online T&E services? Thoughts? As always, thank you for your review, input and guidance Marc 4.703.. . . (c) Nothing in this section shall be construed to preclude a contractor from duplicating or storing original records in electronic form unless they contain significant information not shown on the record copy. Original records need not be maintained or produced in an audit if the contractor or subcontractor provides photographic or electronic images of the original records and meets the following requirements: (1) The contractor or subcontractor has established procedures to ensure that the imaging process preserves accurate images of the original records, including signatures and other written or graphic images, and that the imaging process is reliable and secure so as to maintain the integrity of the records. (2) The contractor or subcontractor maintains an effective indexing system to permit timely and convenient access to the imaged records. (3) The contractor or subcontractor retains the original records for a minimum of one year after imaging to permit periodic validation of the imaging systems. (d) If the information described in paragraph (a) of this section is maintained on a computer, contractors shall retain the computer data on a reliable medium for the time periods prescribed. Contractors may transfer computer data in machine readable form from one reliable computer medium to another. Contractors’ computer data retention and transfer procedures shall maintain the integrity, reliability, and security of the original computer data. Contractors shall also retain an audit trail describing the data transfer. For the record retention time periods prescribed, contractors shall not destroy, discard, delete, or write over such computer data.
  3. Section 102. Wow. "The bill takes aim at incurred-cost, which aides say are slow, time-consuming and do not deliver substantial enough returns for the taxpayer. In 2016, it took 885 days for the Defense Contract Audit Agency to complete these audits, which accounted for “a pretty small percentage of the net savings the DCAA brings to the government,” an aide said. The bill's three-tiered answer would be to: Let contract officers choose either DCAA or outsource to a qualified private sector auditor. Raise the contract-value threshold that requires such audits. Require the audits to be done within a year, so to encourage contractors to focus on high-risk audits."
  4. Hello Wifcon Forum Members, I've recently began reviewing a physically completed T&M/LH for closeout purposes. This particular T&M/LH contract has the following specifications under the heading "Maximum Hours and Cost" for the following two labor categories: Sr. Software Engineer - 656 hours at $/hour Program Manager - 18 Hours at $/hour A review of the contract invoices shows the following amount of Labor Hours billed/charged during the course of the contract: Sr. Software Engineer - 381 hours Program Manager - 38 hours As you can see, the SSE was well under the allotted hours and the PM was slightly over. My main questions concerning this situation are : Given that the PM charged more than the 18 allotted hours, would our company need to issue a refund of the 20 hours paid in excess of the PM allotted hours? Would the fact that we were well under the total amount of allotted hours (SSE & PM allotted total hours) and came in well under the funded amount (DE obligated the excess funding) to finish the job make any difference? I read through FAR 52.232-7 - Payments under Time and Materials and Labor Hour Contracts, specifically the section concerning "Hourly Rates" and more specifically part 3 (see bold below). Would hour allotments fit into the "labor qualification" mentioned below in part 3? "(a) Hourly rate. (1) Hourly rate means the rate(s) prescribed in the contract for payment for labor that meets the labor category qualifications of a labor category specified in the contract that are— (2) The amounts shall be computed by multiplying the appropriate hourly rates prescribed in the Schedule by the number of direct labor hours performed. (3) The hourly rates shall be paid for all labor performed on the contract that meets the labor qualifications specified in the contract. Labor hours incurred to perform tasks for which labor qualifications were specified in the contract will not be paid to the extent the work is performed by employees that do not meet the qualifications specified in the contract, unless specifically authorized by the Contracting Officer. (4) The hourly rates shall include wages, indirect costs, general and administrative expense, and profit. Fractional parts of an hour shall be payable on a prorated basis. (5) Vouchers may be submitted not more than once every two weeks, to the Contracting Officer or authorized representative. A small business concern may receive more frequent payments than every two weeks. The Contractor shall substantiate vouchers (including any subcontractor hours reimbursed at the hourly rate in the schedule) by evidence of actual payment and by— (6) Promptly after receipt of each substantiated voucher, the Government shall, except as otherwise provided in this contract, and subject to the terms of paragraph (e) of this clause, pay the voucher as approved by the Contracting Officer or authorized representative. (7) Unless otherwise prescribed in the Schedule, the Contracting Officer may unilaterally issue a contract modification requiring the Contractor to withhold amounts from its billings until a reserve is set aside in an amount that the Contracting Officer considers necessary to protect the Government’s interests. The Contracting Officer may require a withhold of 5 percent of the amounts due under paragraph (a), but the total amount withheld for the contract shall not exceed $50,000. The amounts withheld shall be retained until the Contractor executes and delivers the release required by paragraph (g) of this clause. (8) Unless the Schedule prescribes otherwise, the hourly rates in the Schedule shall not be varied by virtue of the Contractor having performed work on an overtime basis. If no overtime rates are provided in the Schedule and overtime work is approved in advance by the Contracting Officer, overtime rates shall be negotiated. Failure to agree upon these overtime rates shall be treated as a dispute under the Disputes clause of this contract. If the Schedule provides rates for overtime, the premium portion of those rates will be reimbursable only to the extent the overtime is approved by the Contracting Officer. (i) Performed by the Contractor; (ii) Performed by the Subcontractors; or (iii) Transferred between divisions, subsidiaries, or affiliated of the Contractor under a common control. (i) Individual daily job timekeeping records; (ii) Records that verify the employees meet the qualifications for the labor categories specified in the contract; or (iii) Other substantiation approved by the Contracting Officer." Any guidance/advice would be appreciated. V/r, KR_2016
  5. Hello Wifcon members, I have a situation that I hope one of you can help me with. A subcontractor that worked under one of our Prime Contracts recently sent me their final invoice this month (Sept 2016), their final invoice was a rate adjustment based on their DCAA approved final indirect rates. The Prime Contract they worked under ended in 2014, but still has funding remaining on it. My questions are: Can I bill their Final Rate Adjustment Invoice against the remaining funding left on the prime contract even though the prime contract has already ended? Our prime contract costs for FY 2014 (year the prime contract was physically completed/ended) are currently being audited by the DCAA, would billing out the final invoice in FY2016 cause that cost to show up on the 2016 DCAA ICA? Is there a way to bill this Rate Adjustment Final Invoice without interfering with the DCAA's ICA? I'm somewhat new to this whole process and appreciate any guidance. V/R, KR_2016
  6. Hi All, I work for a small federal contractor (90% of our work is gov't contracts) that does not have a purchasing department. Rather, our engineers do their own purchasing. Needless to say, this is a nightmare for me from a compliance standpoint, and the President of the company (also an engineer) is resistant to change. I've recently discovered that we are issuing POs for direct charge parts and materials where multiple contracts are charged to one PO. However, rather than noting the allocated amount being charged to each contract's project number, we are assigning a percentage value of the cost of each line item that is to be charged. Here's an example: Widget qty 10 unit price $1 total $10 Contract #A 20% Contract #B 35% Contract #C 42.5% IR&D Project 2.5% I've never seen a company do this before. Is this ok, or do we need to show the exact dollar amount allocable to the contract or project to which the items are charged? Thanks in advance for your thoughts!
  7. I was hoping I could pick someone's brain, as I wanted to confirm as to whether or not there is some federal or accounting principle that would prevent the following or if there are any ramifications that I may not be aware of? Long story short, we are a Subcontractor to a contract in which the Prime is requesting to handle all travel for our employees. From making arrangements, to reimbursing and/or paying the employee. The CLIN associated with travel was awarded on a cost reimbursable basis not-to-exceed $350k. Not sure if it's such a big deal but logically it just doesn't make sense to me. My understanding is that should we ever be audited by DCAA, that the question would be raised of why the Prime elected to handle and issue a purchase order strictly for labor. Thank you in advance for your thoughts and expertise. Rae
  8. Hello All, Recently DCAA finished it's audit of our 2008 Incurred Cost Submission. One of the findings we are taking issue with is for a subcontractor who apparently did not file (and has not filed to-date) an incurred cost submission of their own. DCAA affirms that it was our responsibility to make sure the subcontractor filed an ICS. I believe this was the only contract the subcontractor had for the year. This is leaving us with potentially millions in penalty. Does anyone have experience with this type of situation or similar? I am trying to research as much as possible to see what options we have at this point. Any and all feedback is helpful. Thanks!
  9. Good Day All: Is it at all possible to have a private firm or CPA audit and find acceptable an accounting system of a prospective federal contractor? Far Part 42 states " Normally, for contractors other than educational institutions and nonprofit organizations, the Defense Contract Audit Agency (DCAA) is the responsible Government audit agency. However, there may be instances where an agency other than DCAA desires cognizance of a particular contractor. In those instances, the two agencies shall agree on the most efficient and economical approach to meet contract audit requirements. For educational institutions and nonprofit organizations, audit cognizance will be determined according to the provisions of OMB Circular A-133, Audits of Institutions of Higher Education and Other Non-Profit Institutions."
  10. The DoD IG recently published its review of various DCAA audits from 2011-2013: http://www.dodig.mil/pubs/report_summary.cfm?id=5967. I found pages 61-71 about DCAA audit 2701-2012C210... to be very insightful. The issues surrounding this report highlight an apparent difference between the cost analyst and the DCAA auditor. Hypothesis: The primary value of the cost analyst at a prime contractor (or upper-tier subcontractor) is to mitigate time constraints imposed by DCAA requirements (or, stated positively, to provide flexibility in maximizing the value for the customer.) Timeline of Events: Sep'10 - The Joint Strike Fighter (JSF) program office (PMO) asked DCAA Ft. Worth for assistance in anticipation of a proposal for 42 aircraft. Jan'11 - The JSF PMO changed its requirement to only 32 aircraft and asked DCAA to not review subcontractor proposals (see Key Points 1 & 2). Mar'11 - The JSF PMO asked DCAA Ft. Worth to provide "full scope audit assistance" once the proposal was received by DCAA Ft. Worth. Apr-May'11 - DCAA Ft. Worth received the proposal and determined it adequate while waiting for cost/price analysis on $1.7B in subcontracts. Aug'11 - DCAA Ft. Worth asked DCAA Bay States Branch Office (BSBO) to perform and complete an assist audit by the very end of Nov'11. Sep'11 - DCAA BSBO said the subcontract proposal had many inadequacies, but agreed to proceed and give an adverse (bad proposal) opinion. Sep'11 - The JSF PMO asserted in its pre-negotiation memo (not yet approved) that it would rely upon its own cost analyst for the subcontract. Nov'11 - DCAA BSBO gave DCAA Ft. Worth a memo with limited cost information saying its assist audit report should be done by mid-Jan'12. Nov'11 - The JSF PMO pre-negotiation memo (see Sep'11) was approved on the very date the assist audit was originally supposed to be done. Jan'11 - The results of a DCMA technical evaluation were received by DCAA BSBO, but not incorporated into the audit report (issued 7 weeks later). Mar'12 - DCAA BSBO provided its adverse opinion that the proposal was not acceptable for negotiation (just under 4 months after the due date). DoD IG Findings: 1. DCAA should not have started the assist audit if DCAA didn't think it was adequate. And, (apparently...) in the future if the customer still wanted DCAA to continue, then DCAA should report that customer to the DoD IG?! (Different people could reach different conclusions from the DoD IG report.) 2. DCAA should have not have made the judgment call to request the assist audit. The JSF PMO had made it clear that it would take care of all the subcontract proposals on its own and did not need DCAA to help. (This is where the cost analysts at the prime and at the JSF PMO were used.) 3. Once DCAA decided to actually proceed with the assist audit of the subcontract proposal, DCAA should have incorporated the results of the technical evaluation from DCMA. According to the DoD IG, DCAA had "ample time" to incorporate the results (e.g. 7 weeks before audit report issuance.) Key Points: 1. In Jan'11 the JSF PMO stated that it was "willing and open to discuss realistic, creative solutions to the generation and transmission of audit data to seek the greatest benefit to the Government." (That sounds like getting the facts without the report.) 2. In Jan'11 the JSF PMO also communicated there was 'enormous pressure to get...wrapped up by late summer/early fall' and that the JSF PMO would use the price/cost analysis of the prime contractor on the subcontract proposal. 3. In Sep'11 the JSF PMO communicated that its prenegotiation plan relied upon the JSF PMO cost analyst input for this subcontractor and took into account the prime contractor's price/cost and technical analysis of the subcontract proposal. 4. The DoD IG agreed with the JSF PMO that its prenegotiation memo demonstrated "a combination of analytical techniques and procedures used by the contracting officer to establish a fair and reasonable pre-negotiation position" for the subcontract. Outcome: DCAA disagreed with the DoD IG on all three findings and asserted that the new DFARS adequacy checklist would take care of things in the future. The DoD IG agreed that the new DFARS checklist would help and also stated, "Although DCAA did not agree, the management comments are responsive and we do not require additional comments." (This appears to mean the DoD IG decided to just drop the issue.) Conclusion: Whereas DCAA may conclude a proposal is inadequate for audit and should not be used as a basis for negotiations, the program office will find "realistic, creative solutions" to formulate prenegotiation positions and meet schedule expectations.
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