There isn’t a word that sucks the life out of a party more than “compliance.” It’s especially true if that party is the one being thrown by your team after securing that lucrative DoD (Department of Defence) contract. Here’s what you need to know about timekeeping and DCAA (Defense Contract Audit Agency).

Yay! You did it! You secured that government contract!

Now, you need to comply! Ohhh

The party is over, it’s time to get down to work. With DoD contracts come guidelines to ensure that every hour worked falls in line with the expectations of the agreement. After all, it’s understandable. There are taxpayer dollars in play, and everyone has to be held accountable. These checks on labor charges are where DCAA timekeeping compliance comes in.

Timekeeping is what it is -it’s not glamorous, it’s functional. But here are some DCAA rules and guidelines around labor charging that you may not be aware.

Make sure everyone knows what’s going on.

Unlike material costs which are physically easier to prove, labor costs have to be tracked meticulously. Labor charge documentation is a pretty big deal with the DCAA.

Here’s where office transparency comes in handy.

You have to ensure that each employee involved with a DoD contract knows that they must submit their time, accurately and daily. Supervisors and managers cannot enter employees time. Employees must sign off on their time by submitting it for approval from an approving manager or supervisor.

According to DCAA, it’s crucial that everyone involved knows the timekeeping policies and procedures surrounding DoD contracts. Document each policy and procedure and have it readily available for each employee.

Employees working hard on their assigned tasks are in their flow so timekeeping can easily slip their mind. Having a timesheet system that has automated daily reminders will help ensure timekeeping engagement.

Prepare a detailed and rock-solid timesheet

Along with policies and procedures, DCAA requires specific timekeeping data for all labor charges. Here are essential timekeeping elements that must be included on every timesheet:

  • Full name of the employee reporting the work,
  • Time spent performing the work, and
  • Project code, contract code or other identifiers

Furthermore, employees should have access to reference material that clearly explains which project codes link to the work that they are performing.

Additionally, employees must submit ALL of their time. This includes any unpaid hours. An example of which would be salaried employees overtime hours. Labor charges are based on the total hours worked, regardless of how the employee is paid.

Oh, and here is one more thing you may not be aware. The DCAA requires documentation of all timesheet changes, complete with previous values and codes. Choose a timekeeping system that tracks all of this for you, it will save a ton of administrative work.

Establish a timekeeping hierarchy for approvals

Managers or supervisors are responsible for approving (or rejecting) and cosign all employee timesheets. Approvals ensure that all timesheet data is accurate and in compliance with DCAA guidelines. Remember, all employees are responsible to enter their own time, timesheet approvers cannot do this.

Be alert, and prepare yourself with a timekeeping system complete with automated approval notifications. It will go a long way in reducing approval backlogs.

Be prepared for labor floor checks or interviews

Periodically, DCAA auditors may visit your work areas and interview employees to determine if:

  • Employees are actually at work,
  • Employees are performing their assigned job, and
  • Employee time is charged to the appropriate job and contract

Additionally, DCAA auditors may also perform accuracy check-ups on your timekeeping system. These checks will validate that any labor charges are in line with the company’s timekeeping.

Ideally, having a timekeeping system with DCAA compliant audit reporting will instantly prepare you in the event of a labor floor check. Imagine the panic and frustration if all timekeeping was kept on paper!

Compliance doesn’t have to be a complete party stopper!

Finally, with a compliant timekeeping system in place liked Dovico Timesheet and your dream team informed and onboard, DCAA audits should never cause you much grief. Just do the work, enter your time, and you’ll always be prepared.

Here are some key features that Dovico Timesheet has that makes it a DCAA compliance shoo-in:

  • Enter time anywhere with mobile apps or a connected web browser.
  • Manager timesheet approvals.
  • Manual time entry.
  • Time lockouts.
  • Timesheet notifications to enter time or approve time.
  • Comprehensive DCAA compliant audit trail reporting.
  • Custom fields to capture additional DoD contract information.
  • Time entry descriptions.

Download Dovico’s DCAA Compliance Checklist


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About the Author

Jeff Nagle is our wordsmith and blogger. When he’s not cooped up in his office with the door closed writing, he’s working out at the gym, reading, or training for a marathon. Sometimes he attempts to do all three at the same time!

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