Best practices to ensure your DCAA Compliant Timekeeping Checklist is Complete
Timekeeping continues to be a hot item for government contractors including DCAA Compliance. Adequate timekeeping practices are crucial to successfully securing or maintaining a government contract accounting system. Often deficient timekeeping is the reason for failing a DCAA (defense contract audit agency) audits. Hour Timesheet can help you check off all the items on your DCAA Compliant Timekeeping Checklist today!
The timekeeping system or procedures must be documented in a timekeeping policy or procedure provided to all employees.
All of the key elements of an adequate timekeeping and compliant accounting system must be addressed.
Every employee must record their time daily.
Recording time in advance or days after the fact such as at the end of the week is not acceptable.
All time must be charged
Time must be charged by day and by project and/or indirect accounts. This includes direct labor cost, indirect labor cost and uncompensated overtime.
Employees must record all indirect time.
Hours not identifiable to a given project must be charged to a proper indirect cost account.
All employee leave time must be recorded.
Employees must record all vacation, sick, holiday and other leave time to the proper accounts.
Job codes that appear in the system should be initiated by finance or the system administrator.
Job codes must be provided to employees authorized to work on a given project.
Under no circumstance may personnel work on one project and record time to a different project.
Under no circumstance may personnel work on indirect tasks and record time as direct costs to a project or vice versa.
Corrections are approved by the employee’s supervisor.
Under unusual circumstances where the employee cannot make the changes to timesheet, the accountant or administrator may make such changes with the employee’s consent.
All employee time must be signed by the employee.
All employee time must be approved by the employee’s supervisor.
All employees should be provided at least documented time keeping training awareness.
Periodic monitoring of compliance with time tracking requirements should be conducted by “practice” DCAA audits or floor checks.
Time sheets and all corrections must be maintained for a period of at least 2 years.
However, project records under a government contract must be maintained for audit purposes for a period of three years after final payment. The requirements for record retention are contained in FAR Subpart 4.7.
Check out more about DCAA Compliant Timekeeping @ Edward D. Moore, CPA dcaaConsulting LLC
Hour Timesheet includes all the features for a DCAA compliant time tracking software for both small businesses and large. Employee timesheets are in the cloud are available real time with an online approval timesheet process for supervisors. We can review your requirements together to make sure your DCAA Compliance Timekeeping Checklist is complete