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DOCUMENT RESUME
02619 - [A17126891
[Department of Defense Procedures to Determine Contractor
Compliance with Cost Accounting Standards]. PSAD-77-125;
B-39995. June 8, 1977. 5 pp.
Report to Frederick Neuman, Director, Detense Contract Audit
Agency; by Richard W. Gutmann, Director, Procurement and Systems
Acquisition Div.
Issue Irea: Federal Procurement of Goods and Services:
Bea onablencss of Prices Under Negotiated Contracts and
SubcontraAts (1904); Accounting and Financial Reporting
(2800).
Contact: Prcurement and Systems Acquisition Div.
Bu&ge't Fuv',tion: National Defense: Military Assistance (052);
miscellaneous: Financial Management and Information Systems
(1O07 .
A limited evaluation of the adeqiacy cf Department of
Defense procedures to determine contractor compliance with cost
accounting standards and regulations disclosed numerous
instancas of contractor noncompliance. Findings/Conclusions:
The evaluation was directed toward the work of the Defense
ContT:act Audit Agency, which has basic responsibility for
ensuring contractor compliance. In addition to numcouus
identified i:tances of noncompliance, some have goue undetectel
because the Agency does not have adequate controls to ensure
that all significant provisions of the standards hate been
included in the reviews of contractor compliance. The Agency is
considering a control schedule for compliance reviews which
would i4entify cost accounting standard provisions significant
to a particular contractor based on potential for impact on
contrict costs, and which would signif-4cantly improve the
planning of iompliance revieus. Recommendations: The Agency
should proceed with the further development and implementation
of the controls needed to assure that sufficient audit coverage
is given to contractor compliance with cost accounting
standards, rules, and regulations. (DJm)](ViewImageLocal?handle=hein.gao/gaobaackf0001&div=1&collection=&method=preview&ext=.png&size=3)