How to Choose a Government Contractor CPA (DCAA Accounting)

A government contractor CPA builds and maintains an accounting system that can stand up to a DCAA audit. For cost-reimbursable work, the requirements come from DFARS 252.242-7006 and the cost principles in FAR Part 31.

• Accounting system setup: job costing by contract, segregation of direct and indirect costs, and timekeeping controls, tested against DCAA’s Pre-award Accounting System Adequacy Checklist.
• Indirect rates: fringe, overhead and G&A pools, allocation bases and provisional billing rates.
• Unallowable costs: identifying and excluding costs that FAR 31.205 does not allow.
• Submissions: incurred cost submissions, forward pricing rate proposals and support during DCAA audits.

See our government contractor accounting services and government contractor audit pages.

1. Check the license. Search the CPA or firm on NASBA CPAverify. If the state does not participate, use the state board through NASBA’s state board directory.
2. Check peer review for audit work. If the firm will audit your financial statements or perform other attest work, look up its latest report in the AICPA Peer Review public file.
3. Ignore “DCAA certified.” DCAA audits contractors at a contracting officer’s request. Its contractor FAQ says it neither recommends nor approves accounting software. Licenses come from state boards.

1. Have you prepared contractors for a pre-award accounting system review against DCAA’s checklist?
2. How do you design indirect cost pools and allocation bases, and compute provisional billing rates?
3. Do you prepare incurred cost submissions using DCAA’s ICE model, and do you support clients during the audit?
4. How do you screen unallowable costs under FAR 31.205 in the general ledger?
5. What timekeeping controls do you expect, and how do you test them?
6. Which accounting and timekeeping systems do you work with?

• The CPA or a software seller claims to be “DCAA certified” or “DCAA approved.”
• No discussion of timekeeping controls, which DCAA tests closely.
• Unfamiliar with FAR Part 31 unallowable costs or how to segregate them.
• Has never supported a client through a DCAA audit or incurred cost submission.
• Suggests buying software as the whole answer to “DCAA compliance.”

Not sure where you stand? Try our DCAA readiness assessment.

• A licensed CPA firm working with government contractors nationwide, virtually.
• Services across the contract life cycle: accounting system setup, incurred cost, forward pricing rates, FAR 31 compliance, CAS compliance, SBA 8(a) audits and government contractor tax.
• Transparent fees quoted upfront, in writing.
• A free initial consultation before any work starts.

Best for: small and mid-size contractors moving into cost-type or T&M work, and contractors facing a DCAA review or an incurred cost deadline.

1. Free initial consultation. Tell us your contract types, agencies, systems and deadlines.
2. Fees quoted upfront, in writing. An engagement letter before work starts.
3. Readiness review. We test your system against DCAA’s pre-award checklist and FAR Part 31.
4. Fixes. Chart of accounts, indirect rates, timekeeping procedures and written policies.
5. Ongoing support. Rate monitoring, incurred cost submissions and audit support.