DCAA is an acronym of Defense Contract Audit Agency. It is the agency which is responsible for reviewing accounting system of government contractors. While you might be having fixed price contracts but you must have an accounting system that is compliant with DCAA accounting system and would support prime contractors.
Some Activities Taken Up By DCAA
The agency takes care of the accounting reviews to make sure that the awardee can meet the requirements of the federal contracting rule. Then it conducts pre-award surveys, reviews of the financial capabilities, floor checks and the incurred cost audits.
Are FAR Regulations Being Met?
The DCAA carries and audit or pre-award survey of a government contractor, they are taking a look at the contractor’s compliance with Federal Acquisition Regulations (FAR). The FAR system consists of regulations that are issued by the agencies of the federal government to carry on the acquisition process. The FAR outlines the requirements for selling to the government, the terms under which the government obtains the ownership, title, and control of the goods or services purchased. It guides on how to sell to the government, the rules that clarify the specifications, payments and the conduct. It also details on how the bids will be solicited and how the invoices will be paid for.
Importance To Government Contractors
Those contractors who are not compliant with FAR maybe barred from future government contracts. They may even be barred from teaming with other contractors. The DCAA may even suggest to the Contracting Officer to stop all the payments on the work that is in progress. On the suggestions from DCAA may even disallow costs on the completed contracts. It is becoming crucial that the government contractors comply with FAR.
Does This Mean Having A Special Accounting System?
There are many accounting systems prevalent in the market which claims that they can help meet the compliance. But the fact is that you do not need to invest in any new applications to meet the DCAA standards. A professional who can set up your accounts and also has ample knowledge of the DCAA guidelines is very much desired.
In The End
DCAA accounting is must for those contractors who are vying for the government contracts. So they you’ll have to find right people who can help you in meeting the compliances well.
|