Post by Veronica Eyenga, contributing Women On Business writer
Before work can begin on a contract, contracting officers can request a DCAA Pre-award Survey of Prospective Contractor Accounting System. The goal is simple: the contracting officer needs to understand your account system and determine whether or not that system is adequate to fulfill the contract.
Companies that have been awarded their first federal government contract may be surprised: even a company that has been judged squeaky clean by the IRS on Monday can fail a DCAA audit on Tuesday. Even worse: where previously DCAA offered suggestions for improvement, now the DCAA works on a simple pass-fail system.
Any accounting system – Peachtree, Quickbooks, SAP – can be set up to pass a DCAA Preaward Survey Audit. The key is preparing for the audit, and knowing the criteria DCAA uses to complete what is termed the survey form, which is SF 1408:
- Does the company follow GAAP (Generally Accepted Accounting Principles?
- Are direct and indirect costs properly segregated, allocated and detailed?
- Are accounts reconcilable and posted to the general ledger?
- Are labor costs correctly charged, verified and reconcilable?
- Are costs posted at least monthly?
- Are costs correctly defined as allowable and unallowable?
- Are costs adequately detailed?
- Are costs internally monitored and reviewed?
- Does the contractor have internal controls to ensure costs and billing are in compliance with the contract?
- Does the company provide reporting in compliance with the contract?
Full audit requirements are listed in SF 1408.Remember, when contracting with the Government preparation is key. The pre-award survey is your opportunity to show you are able to fulfill the term of your contract, so be sure all aspects of your business meet the necessary compliance requirements.
Susan Gunelius
Susan Gunelius is the Founder and Editor-in-Chief of Women on Business. She is a 30-year veteran of the marketing field and has authored a dozen books about marketing, branding, and social media, including the highly popular Ultimate Guide to Email Marketing, 30-Minute Social Media Marketing, Content Marketing for Dummies, Blogging All-in-One for Dummies and Kick-ass Copywriting in 10 Easy Steps. Susan’s marketing-related content can be found on Entrepreneur.com, Forbes.com, MSNBC.com, BusinessWeek.com, and more. Susan is President & CEO of KeySplash Creative, Inc., a marketing communications company. She has worked in corporate marketing roles and through client relationships with AT&T, HSBC, Citibank, Intuit, The New York Times, Cox Communications, and many more large and small companies around the world. Susan also speaks about marketing, branding and social media at events around the world and is frequently interviewed by television, online, radio, and print media organizations about these topics. She holds an MBA in Management and Strategy and a Bachelor of Science degree in Marketing and is a Certified Professional Career Coach (CPCC).
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