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DCAA Audit Services

We help companies prepare for routine DCAA Audits and DCMA Reviews with confidence.

Capital Edge’s DCAA Audit Services support clients in preparing for audits of financial and accounting data, or that are narrowly focused, specialized investigations stemming from a variety of causes.

DCAA audits include reviews of contractors’ financial representations and non-financial assertions designed to assess if contractors’ costs are reasonable, business system and compliance controls are designed and operating effectively and comply with contract terms. We guide our clients by employing our leading expertise, anticipating and meeting the needs for audit services, and facilitating decision making around regulatory compliance needs.

Our signature DCAA Audit Services include: 
  • Analysis, design and documentation of compliance infrastructure
  • Support and liaison with all DCAA audits, DCMA reviews and other non-DoD contract audits/reviews
  • Response to audit and review findings regarding proposed non-compliances and monetary adjustments such as price reductions, cost disallowances, decrements and demands
  • Evaluation and performance of “mock audits” or other monitoring functions covering areas such as:
    • Key business systems
    • Timekeeping and labor distribution
    • Cost estimating and project reporting
    • Identification and implementation of required corrective action plans
    • Subcontractor or supply chain support
  • Preparation, submission, and audit support of the following:
    • Annual incurred cost proposals
    • Termination for convenience settlement proposals
    • Request for equitable adjustment proposals
  • Cost Accounting Standards (CAS) compliance
  • Interpretation and application of the FAR
  • Litigation Support
  • Truth-in-Negotiations Act (defective pricing)

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Fill out the form below or call  (855-227-3343)

DCAA Audit Frequently Asked Questions

What are the different types of DCAA audits?

DCAA audits may be of a financial or non-financial scope and are designed to assess whether contractors’ costs are reasonable and otherwise comply to a variety of regulatory compliance and contract terms. DCAA audits are triggered by a government contracting officer’s request for audit services and are used to assist with making decisions or regulatory compliance needs. The DCAA does not conduct audits requisitioned directly by contractors, rather, audits are performed either as initiated by the DCAA or requested by a federal agency.

DCAA audits may entail a singular audit of a nonrecurring or infrequent nature, or a few or several different audits performed on a concurrent basis.  Actually, there’s a DCAA audit for almost every type of accounting situation, with the more common ones including:

  • Incurred Cost Audits
  • Accounting System Audits
  • Labor Evaluation Audits
  • Estimating System Audits
  • Price Proposal (Pre-Award) Audits
  • Defective Pricing (Post-Award) Audits
  • DCAA Public Voucher Audits
Will DCAA conduct virtual floor checks during the current environment?

Yes. In the current environment with an increase in Work at Home (WAH) employees, DCAA can conduct virtual floor checks

A virtual floor check, (or floor checks by phone), somewhat diminishes DCAA’s approach to floor checks. Floor checks are intended to be unannounced in order to interview an “uncoached” employee. Likely, virtual comprehensive floor check audits under the current increase in WAH activity will be minimal. 

→ Click to read more on DCAA Floor Checks 

 

What do you see contractors doing to prepare for a business system audit?

The main activity we see is the performance of a ‘mock audit’ or other forms of self-assessment prior to the start of the audit.  The purpose of the mock audit or self-assessment is to determine if current internal controls are operating effectively and if compliance gaps may exist.  If gaps are identified, corrective action plans may then be developed and potentially put into action. 

This process demonstrates the monitoring function that is required as an element of a compliant business system and may be an effective portion of the system demonstration provided to the DCAA during the initial phases of the audit.

 

Is the DCAA auditing contractors receiving funds under the CARES Act?
Yes. The DCAA has two newly created audit objectives related to the CARES Act. As the CARES Act and funds received by contractors is a relatively recent thing, these audit objectives and forthcoming procedures are evolving and under development. However, we are seeing the DCAA involved in two main areas. First, the treatment of forgiven loans received under the Paycheck Protection Program (PPP). The DoD’s and DCAA’s position is that forgiven PPP loans are to be treated as credits under FAR 31.201-5. This means that contractors with cost reimbursement contracts may be required to credit to the government applicable portions of the forgiven loan proceeds. Second, the DCAA is currently developing audit procedures related to contractors submitting REAs under Section 3610 of the CARES Act. Contractors will need to provide comprehensive supporting documentation for requests for reimbursement and should follow the published DoD guidance.

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

A few things are primary, and, if performed effectively should enhance the opportunity for a low or medium risk determination. First, timely and thorough responses to DCAA’s initial requests for information. Responses need to specifically address the DCAA requests or questions and demonstrate how the response satisfies the related compliance requirement or audit objective. Second, identification and submission of relevant written documentation demonstrating the use and effectiveness of key controls. Written documentation may be policies, procedures, process flows, or other material. And third, a comprehensive business system demonstration or walkthrough of the processes, procedures, and internal controls applicable to the principal components of the business system.

Why struggle through your DCAA audit prep? 
Contact us today for our full scale DCAA Audit Support Services today.

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CAS Training

TRAINING & EVENTS

We have quite a few upcoming trainings that could benefit you and your team as you navigate the CAS. Check out our existing events or contact us about custom training for your business today!
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About Capital Edge Consulting

Capital Edge government contract consultants support Government Contractors and Federal Grant Recipients. Our consultants specialize in the regulatory compliance matters you need.

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8200 Greensboro Dr #1400
McLean, VA 22102

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