Common Errors in Timekeeping for DCAA Contracts – Part I

One of the key areas of a DCAA compliance audit is timekeeping.  Small government contractors typically fail compliance audits as a result of inadequate timekeeping procedures.  Most small government contractors lack sufficient documentation of timekeeping procedures.

For government contracts, DCAA and other federal contracting regulatory bodies require contractors to formally document timekeeping policies and procedures in a manual distributed to all employees.  Here are a few of the common policies required in the timekeeping procedures manual:

1. Time must be recorded daily, not in advance or after the fact.  For manual systems, time sheets  and time sheet corrections must be in ink.
2. Time must be recorded to contracts, where applicable, or indirect cost categories, when an employee is not working on a contract.
3. Employes must make their own corrections to time records, which must then be authorized by supervisors.
4. For electronic time keeping systems, employees should only have access to contract codes, where they are authorized to charge time.

This is just a brief list of some of the requirements.  There are more.  Also, contractors must document the delivery and availability of the procedures manual to employees.

Employees must also receive annual time keeping training.  The regulations require that the training can be either formal or informal, but we recommend documenting when each employee is trained in personnel files.

Total Accounting Care offers federal time keeping compliance as a core part of the service.  If you have any questions or for a review of your system, please contact Michelle Evans at mevans@TotalAccountingCare.com or (703) 818-8284.  Please visit our web site at www.TotalAccountingCare.com

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