Defense Contract Audit Agency (DCAA)
Also called: DCAA, DCAA compliance, DCAA audit, accounting system adequacy, SF 1408, DCAA compliant accounting
The Defense Contract Audit Agency performs contract audits for DoD and many civilian agencies: pre-award accounting system reviews, proposal audits, incurred cost audits and indirect rate audits on cost-type and other flexibly priced contracts.
DCAA's role appears throughout FAR Part 42 and DFARS Part 242, and its pre-award survey of an accounting system follows the criteria on Standard Form 1408 (FAR 53.209-1(f)). An adequate system segregates direct from indirect costs, accumulates costs by contract, tracks time by employee and job, and excludes unallowable costs under FAR Part 31. Fixed price and T&M work usually needs no DCAA review; cost-reimbursement contracts, SBIR awards and some large proposals do.
What to check: whether the solicitation requires an adequate accounting system (the clause is DFARS 252.242-7006), whether your bookkeeping can produce job cost reports and a timesheet audit trail, and your provisional indirect rates and the incurred cost submission due each year on cost-type contracts (FAR 52.216-7). DCAA publishes its audit manual and a contractor checklist on dcaa.mil.
What it is not: a certification you can buy. DCAA does not certify software or firms; it reviews your system when a contract action requires it.
See also: Cost-reimbursement (cost-plus) contract, Wrap rate, Time-and-materials (T&M) contract, Defense Federal Acquisition Regulation Supplement (DFARS)
Questions that use this term
Search allMy company, a landscaping firm, has only ever done fixed-price contracts for city parks and school grounds. We just got a call from a prime...