Benefits

Prepare like the government evaluates

Get ahead with assessments, mock audits, and reviews consistent with Defense Contract Audit Agency (DCAA) and Defense Contract Management Agency (DCMA) processes, led by a team that’s been on both sides of the table.

  • Gap analysis
  • Pre-audit or review corrective actions
  • Mock audits or reviews

Set the tone, reduce the scope

Position your team as the benchmark in entrance briefings to limit subsequent scope and questioning.

  • Entrance briefing preparation
  • System demonstration

Find calm in audit storms

Remove guesswork and stress with real-time support during DCAA, DCMA, and third-party audits or reviews — helping you respond confidently, strengthen your position, and manage risk.

  • Real-time liaison
  • Data call response support

Close findings, prove accountability

Design and implement corrective action plans that resolve findings efficiently and meet government expectations in under 30 days.

  • Corrective action plan development
  • Corrective action plan implementation
Internal view of machinery.

Capital Edge has full-time, established employees with experience out of DCMA and DCAA. They have a roster and infrastructure. With alternatives, there has been inconsistent access to resources. This has never been an issue with Capital Edge.

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Take a deeper dive and discover how we’ve helped clients with DCAA Audits & DCMA Reviews.

FAQs

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What is a DCAA audit?

A DCAA audit is a review of a contractor’s financial representations to determine whether costs are reasonable and comply with contract terms, FAR Part 31 cost principles, and applicable government regulations. These audits are typically initiated by a contracting officer or an administrative contractor who requires audit services to support decision-making or meet regulatory compliance needs. Importantly, the DCAA does not conduct audits requested by contractors themselves. Instead, a DCAA audit is only performed when a federal agency requests it or there is a demonstrated need for audit services.

What are the different types of DCAA audits?

In the world of government contracting, a DCAA audit is not a one-size-fits-all process. There are several types of audits designed to address various accounting scenarios that contractors might encounter. Each DCAA audit is tailored to specific circumstances, ensuring compliance with government regulations. Some of the most common DCAA audits include:

Will DCAA conduct virtual floor checks in work at home environments?

Yes, in response to the increase in Work at Home (WAH) employees, the DCAA is conducting virtual floor checks. A virtual floor check (or floor check by phone) slightly alters the traditional DCAA approach. Typically, floor checks are meant to be unannounced in order to interview employees in an “uncoached” manner. However, with the rise in WAH activity, it is likely that comprehensive virtual floor check audits will be scoped relative to the contractor’s hybrid and remote workforce environment. Learn more about DCAA floor checks here.

What are contractors doing to prepare for a business system audit or review?

A key activity contractors are engaging in to prepare for a business system audit or review under the DFARS business system rule is conducting a mock audit or performing other forms of self-assessment before the actual audit begins. The goal of a mock audit or self-assessment is to evaluate whether the current internal controls are functioning effectively and to identify any compliance gaps.

When gaps are discovered, contractors can develop and implement corrective action plans. This preparation process also demonstrates the required monitoring function that is part of a compliant business system and may serve as an effective element of the system demonstration provided to the DCAA or DCMA during the early stages of the audit.

During a business system audit or review, what steps can a contractor take to assist the DCAA or DCMA with their pre-audit risk assessment process?

To assist the DCAA or DCMA with their pre-audit risk assessment, contractors can take several key steps that may increase the likelihood of a low or medium risk determination:

  1. Provide timely and thorough responses: Ensure that responses to the DCAA or DCMA’s initial requests for information are both timely and thorough. Responses should directly address the DCAA or DCMA’s specific questions or requests, demonstrating how the information satisfies the relevant compliance requirement or audit objective.
  2. Submit relevant written documentation: Contractors should identify and submit written documentation that illustrates the use and effectiveness of key internal controls. This may include policies, procedures, process flows, or other relevant materials.
  3. Demonstrate business system processes: Offer a comprehensive business system demonstration or walkthrough. This should cover the processes, procedures, and internal controls that apply to the main components of the business system.

What is the difference between DCAA and DCMA?

In simple terms, the DMCA is responsible for contract management, while the DCAA focuses on accounting and financial oversight. The DCMA ensures that government contracts are executed in accordance with terms and conditions, monitoring contractor performance, quality assurance, and delivery timelines under DFARS 242.7503 and related business system oversight requirements. On the other hand, the DCAA performs audits to ensure that costs and expenditures submitted by contractors comply with government regulations and contract requirements.

Approach your next audit with peace-of-mind

Get support from former government auditors to prepare, respond, and remediate — so you can move through audits and reviews with minimal disruption.

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