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Stop Stressing Over DCAA Compliance

Sep 24, 2019 | By Steven Burns, FAIA | 0 Comments

Topics: Engineers, Best Practices, Accounting, Business

The Defense Contract Audit Agency (DCAA) provides accounting and financial advisory services to components of the Department of Defense (DoD) that handle procurement and contract administration. The DCAA sets several guidelines, policies and procedures that ensure the systems their contractors use are up to code to ensure that the funding is being spent efficiently and effectively for the taxpayers.

Contractors hired by the DoD and other government agencies that require DCAA compliance must follow those parameters, which requires detailed labor and cost center tracking.

What are the benefits of DCAA compliance?

Making sure that your company follows these guidelines can open your business up to more potential business opportunities.

The federal government recently posted over 37,100 openings. All of these potential jobs would require the contractor to conform with DCAA guidelines. Doing so will set your business up for success in procuring and keeping these potential contracts. Plus, following them will keep your business well run, organized and professional. Using DCAA compliant software keeps you nimble and able to account for updated policies you may otherwise miss.

How do I become DCAA compliant?

The best way to ensure that your business is DCAA compliant and stays DCAA compliant is to invest in DCAA compliance software. There is no certificate that labels a company as DCAA compliant. Instead, you are considered DCAA compliant if you meet their regulations and guidelines. The Federal Acquisition Regulations are a set of regulations put in place for government procurement. This outlines the requirements for contractors when selling to the government.

Using DCAA compliant software streamlines the process of becoming DCAA compliant and makes it easy for a business to be ready for audits and adjust to any changing policies or procedures set by the DCAA or as mentioned in the DCAA audit manual. In addition to expanding the number of government agencies you can work with, DCAA compliance can provide additional security to your system, streamline your procedures for labor approvals and correction records and offer effective procedures for labor cost accounting.

How could my system work for me?

A good DCAA compliance software will effortlessly combine with your business model to simplify your systems while following DCAA requirements.

DFARS 252.242-7006(a)(1) defines an acceptable accounting system as one that provides reasonable assurance that applicable laws and regulations are complied with, the accounting system and cost data are reliable, risk of misallocations and mischarges are minimized and that contract allocations and charges are consistent with billing procedures.

Using DCAA compliance software eliminates any worries a potential government contractor may have about following all the policies and procedures required for DCAA compliance, including what is found in the DCAA audit manual.

Click here for a detailed list of some of the DCAA’s requirements and some solutions that DCAA compliant software has offered. Software has proven to offer solutions that simplify employee awareness programs, labor distribution, labor authorization and approval, cost accounting, security, defining rates, time card preparation and separation of responsibilities, all of which are in DCAA compliance.

Whether being audited for incurred cost, CAS, business systems, claim/terminations, forward pricing or something else, having your information in an organized record-keeping system that matches your business model will help you respond to audits quickly and effectively. This can be used as an investment in the long run and save your organization valuable time and money.

The Author

Steven Burns, FAIA

Steven Burns, FAIA, spent 14 years managing his firm Burns + Beyerl Architects. After creating ArchiOffice®, the smart office and project management solution for architectural firms, Steve brought his management expertise to BQE Software, where he is perfecting the business strategy and product development.

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