In this episode Jenny Clark talks about DCAA Pre-Award Survey SF1408.
DCAA Pre-Award Survey SF1408
Must Be Requested by Contracting Officer
- To Pass it, you must be able to show how you compute your Indirect Rates
- If you cannot compute your indirect rates from your Income Statement, then you don’t have accurate information to price your jobs
- How do you know whether you’re making a profit when you bid?
DOES YOUR PROFIT AND LOSS LOOK LIKE THIS?
Usually Monthly Billings
DIRECT COSTS (AKA Billable Costs)
Direct Labor of Employees Working on Contracts
Direct Travel for trips taken for contract purposes
INDIRECT COSTS (Support Costs, Shared Costs, “Overhead”)
Fringe (Payroll Taxes, Leave, Benefits)
Overhead (Support cost for technical workforce)
General and Administrative (Corporate)
Interest, Entertainment, Advertising, Sponsorships, etc
If it doesn’t, then I cannot compute your indirect rates, and you will NOT PASS a DCAA Audit.
WWW.DCAA.MIL Information for Contractors
1.Follows Generally Accepted Accounting Principles (GAAP).
2.Proper Segregation of direct costs from indirect costs.
3.Identification and accumulation of costs by contract.
4.Indirect Rate calculations and allocations.
5.Uses General Ledger Accounts and controls.
6.Timesheets show employee recording hours to contracts, indirect labor and leave.
7.Labor Distribution system charges employee labor cost to contracts, indirect labor and leave.
8.Monthly Closing process.
9.Exclusion of Unallowable costs.
10.Tracking by Contract Line Item (CLIN), Task, etc.
11.Segregation of preproduction costs from production costs.
12.Tracking against Contract Funding.
13.Ability to support requests for progress payments.
14.Adequate, reliable data for pricing follow-on acquisitions.
15.System in full operation
QBO is TOO SIMPLIFIED to pass a DCAA Audit.
People get it because they want ONLINE access.
SO GET IT HOSTED INSTEAD!
▶QuickBooks Desktop Premier https://quickbooks.intuit.com/desktop/premier/
▶Have it Hosted
▶Recommend that you use INTUIT payroll because others are not truly integrated.
▶Timesheets must show AUDIT Trail – Hours and COSTS by Job
More User Security
If you already have QuickBooks but it’s not set up to be DCAA Compliant:
– Change the Account Structure & Reclassify Transactions
– Break out your Gross Payroll Hours and Pay by Employee & Job
– Method and Process for setting up Item Codes and Customer: Jobs
– Review and Correct items that are coded incorrectly
– Written Process and Training
– Training for your staff, including Excel and advanced Reporting
This may be why your Banker doesn’t take you seriously…
– Items on the Balance Sheet that need to be on Income Statement, which means your PROFIT is wrong
– Negatives where there should be positives
– Large numbers that don’t make sense
– Items called by archaic names
– Old Invoices on the Accounts Receivable Aging that you’ll never collect
– Profit and Loss by Job Report shows huge profit swings
– Profit and Loss by Month report shows a roller coaster of revenue and profit
Complexity, Timing, Qualified Personnel
Set up a FREE Evaluation Meeting with Solvability today
What would it mean to KNOW where you are making money?
How would accurate information help you win more contracts and grow faster and more profitably?
How would you invest in your company and yourself if you had more cash flow?
What risk are you taking by NOT having the right answers?
Why should you be doing this all ALONE?
To contact Jenny W Clark
CEO, Solvability, Inc
- Self Study
- Hand to Hold
- Prime Focus