DCAA Audit Issues

Brief

HKA experts have performed numerous engagements analyzing and rebutting the findings of US Government auditors, including the Defense Contract Audit Agency (“DCAA”). In one instance, our experts were retained to rebut DCAA audit findings that questioned US$125 million of over $1 billion in proposed costs on a Department of Defense contract.  The costs were questioned for a variety of reasons spanning all five criteria of allowability in FAR Part 31: (1) allocability, (2) reasonableness, (3) terms of the contract, (4) CAS compliance, and (5) other limitations on allowability set forth in FAR Part 31.

What we did

HKA experts reviewed DCAA’s audit workpapers and analyzed every questioned transaction, totaling over 2,000 individual line items.  Our experts compiled and analyzed supporting documents for every questioned transaction, resulting in a decrease to the questioned costs from US$125 million to US$8 million. HKA experts then prepared an expert report detailing our findings and presented those findings and support to the Contracting Officer and DCAA.

Outcomes

The U.S. Government’s Contracting Officer accepted all of our rebuttal positions, and the matter settled at the value HKA recommended in our expert report.