Chapter 37 Auditing Government Contractors文档格式.docx

资源描述

Chapter 37 Auditing Government Contractors文档格式.docx

《Chapter 37 Auditing Government Contractors文档格式.docx》由会员分享，可在线阅读，更多相关《Chapter 37 Auditing Government Contractors文档格式.docx（17页珍藏版）》请在冰豆网上搜索。

Chapter 37 Auditing Government Contractors文档格式.docx

37.2LAWSANDREGULATIONS

（a）CostPrinciples,

（i）FAR,

（ii）OMBCircularA-122,

（iii）OMBCircularA-21,

（b）CostAccountingStandards,

（c）OtherProvisionsoftheFAR,

（i）TruthinNegotiationsAct,

（ii）LimitationofCost,

（iii）UnilateralChanges,

（iv）ContractTermination,

（d）Oversight,

37.3ACCOUNTINGPRINCIPLESANDPRACTICES

（a）RevenueRecognition,

（b）ContractCosts,

（c）ContractCostEstimates,

（d）ProvisionsforAnticipatedLosses,

（e）Contract-RelatedAssetsandLiabilities,

（f）ResearchandDevelopmentActivities,

37.4RISKFACTORS

（a）RepricingofContracts,

（i）CAS,

（ii）DefectivePricing,

（iii）CostAudits,

（iv）MostFavoredCustomerProvision,

（b）Claims,

（c）Suspension,

（d）Fraud,Waste,andAbuse,

（e）Subcontractors,

37.5INTERNALCONTROL

（a）CodesofEthics,

（b）EstimatingProcess,

（c）ContractCostAccountingPractices,

（d）UnallowableCosts,

（e）JobOrderIntegrity,

（f）ContractRevenueRecognitionPractices,

（g）PendingContractsandModifications,

37.6SUBSTANTIVETESTS

（a）TimelinessofGovernmentAudits,

（b）ContractsinProgress,

37.1OVERVIEWOFTHEINDUSTRY

Varioustypesofentitiesmayenterintocontractswiththefederalgovernment,1forexample,aerospaceorothermanufacturers,professionalservicesfirms,healthcareintermediaries,orresearchuniversities.Mostoftheiressentialbusinessprocessesarethesamewithrespecttotheirgovernmentcontractingactivitiesaswithrespecttotheirprivate-sectorbusiness.Itisnotthenatureofwhatacontractordoesthatpresentsuniqueauditingissues;

rather,itisthecontractor'

srelationshipwithitscustomerwhenthecustomeristhefederalgovernment.

Thatrelationshipisdefinedbyregulationswithwhichfederalgovernmentcontractorsmustcomply.Theseregulationsgiverisetouniquecontingentliabilitiesandotherissuesthatauditorsmustconsider.Forexample,thegovernmentmayhavetherighttorepriceacontract,ormaywithholdorreducecontractpaymentsforanextendedperiodoftime.Suchcontractrightsheldbythegovernmenthavenocounterpartintheprivatesector.

Theregulationswithwhichgovernmentcontractorsmustcomplyarewrittenbythegovernmentandenforcedbyanelaborateoversightnetworkofgovernmentauditorsandcontractadministrators.Theregulations,andthelawsonwhichtheyarebased,areinherentlypoliticalandaresubjecttofrequentchangebyelectedandappointedofficials.Manyrulesarefundamentallyoppositetoprevailingbusinesspracticeintheprivatesector.Forexample,inmanycases,agovernmentcontractorisrequiredtodiscloseeveryaspectofitspricingprocess,includingproprietaryinformation,tothegovernment.Failuretodosomaybepunishableasacriminaloffense.Thiscontrastswithprivate-sectorcontracts,forwhichdisclosureofpricingdetailsishighlyunusual.Thischapterfocusesonidentifyingthecircumstancesthatcangiverisetotheserequirementsandtheattendantrisksthatgovernmentcontractorsface.

37.2LAWSANDREGULATIONS

Thegovernmenthasestablishedcostprinciplesforthepricingofcontracts,subcontracts,andmodificationstocontractsandsubcontracts.Theprinciplesareapplicablewhenevercontractororsubcontractorcostsaresubjecttoanalysis.Inmostinstances,acostanalysisisrequiredonlyifanawardexceeds$500,000andsubmissionofcostorpricingdataisrequiredbytheTruthinNegotiationsAct[seeSection37.2（c）（i）inthisSupplement].Thecostprinciplesalsoapplywheneveracontractclauseincorporatestheprinciplesaspartofthecriteriafordeterminingornegotiatingtheallowabilityofcosts.Theparticularcostprinciplesfollowedwilldependonthenatureofthecontractor.Mostfor-profitcontractorsarecoveredbythecostprinciplesintheFederalAcquisitionRegulation（FAR）.Not-for-profitorganizationsarecoveredbythecostprinciplesinOfficeofManagementandBudget（OMB）CircularA-122;

researchuniversitiesarecoveredbythecostprinciplesinOMBCircularA-21.Whileallcostprincipleshavemuchincommon,thereareimportantdifferencesandtheauditorshouldalwaysunderstandwhichregulationsapplytoacontract.

（a）CostPrinciples

Allnegotiatedgovernmentcontractsexceeding$500,000arecoveredbycostprinciples.Theparticularcostprinciplesfollowedwilldependonthenatureofthecontractor.Mostfor-profitcontractorsarecoveredbythecostprinciplesintheFederalAcquisitionRegulation（FAR）.Not-for-profitorganizationsarecoveredbythecostprinciplesinOfficeofManagementandBudget（OMB）CircularA-122;

（i）FAR.TheFederalAcquisitionRegulationisthegovernment'

scomprehensiveprocurementregulationandappliestoallagencies.AgenciesmaysupplementtheFARwithadditionalregulations,butmustfollowthebasicrulesintheFAR.Inadditiontodefininganddiscussingsuchconceptsasdirectandindirectcosts,Part31oftheFARintroducestheconceptofallowability.Thisisauniquelygovernmentalconceptandestablishesthatthegovernment,asamatterofpolicy,willnotreimburseacontractorforcertaincoststhatarenotreasonable,notallocabletothecontract,orspecificallyprohibitedbythecontract.

Additionally,Part31oftheFARcontainsspecificinstructionsonapproximately50categoriesofcost,rangingfromadvertisingcoststotaxes.Somecostsareexpresslyunallowable,suchasmostadvertising,lobbying,entertainment,interest,andalcoholicbeveragecosts.Othercostsarereimbursable,includingmanytypesofcompensation,depreciation,andresearchanddevelopmentcosts.Theinclusionofcostsdirectlyassociatedwithunallowablecostsisprohibited,suchastravelcostsincurredinsupportoflobbyingactivities.Manyoftheseprohibitionsarerootedinlaw,andchargingunallowablecoststothegovernmentisconsideredaseriousmatter.Theamountsofunallowablecostsareusuallysmallfromamaterialityperspective;

generally,unallowablecostsconstituteonlyalittleover1percentofcontractcosts.Thepotentialramificationsfrombillingunallowablecosts,suchasfines,penalties,repricing,andinextremecasessuspension,arefaroutofproportiontotheamountsofsuchcosts.Mostunallowablecostsarelegitimatebusinesscosts,andtheFARprohibitiondoesnotaffecttheirdeductibilityfortaxpurposes.

（ii）OMBCircularA-122.Thisregulationcoversnot-for-profitcontractors,exceptforcertainresearchinstitutions（approximately30）thathavehadalong-standingrelationshipwiththeDepartmentofDefenseandwhicharecoveredbytheFAR.Thecircularprovidesprinciplestobeappliedinestablishingtheallowabilityofcertaincosts;

italsoestablishesuniformrulesfordeterminingthecostsofgrants,contracts,andotheragreements,andguidelinesonwhethercostsaretobetreatedasdirectorindirect.

（iii）OMBCircularA-21.CircularA-21appliestouniversities,manyofwhicharemajorresearchcontractors,sincemuchofthefundingforresearchactivitiesisprovidedbythegovernment.Someuniversitiesconductgovernmentresearchtotalinghundredsofmillionsofdollars.Theircostprinciplesdifferfromthoseforothergovernmentcontractorsinthattheyaretailoredtotheaccountingsystemsusedbyuniversities,whoseprimaryreportingobjectiveisaccountingforresourcesreceivedandused.Thecostprinciplesareusedindeterminingtheallowablecostsofworkperformedbycollegesanduniversitiesundersponsoredagreementsandalsoundersubgrants,cost-reimbursementsubcontracts,andotherawards.SectionFofthecircularprovidesforidentificationandassignmentofindirectcostssuchasdepreciation,operatingandmaintenanceexpenses,generalandadministrativeexpenses,departmentaladministrationexpenses,libraryexpenses,andstudentadministrationandservices.

（b）CostAccountingStandards

CertainlargecontractsarealsocoveredbyCostAccountingStandards（CAS）.ContractorssubjecttoCASmayberequiredtocomplywithupto19standardsthatspecifythetreatmentofcertaincosts,tosubmitadisclosurestatementthatdescribesaccountingpractices,andtoadheretootherproceduresregardingchangestoaccountingpractices.

Currently,contractorsareexemptfromCAScoverageunlesstheyreceivea"

trigger"

contractorsubcontractworthmorethan$7.5million.TherequirementtoadheretoallCASprovisionsappliestocontractorsreceivingasingleawardofatleast$50millionorcumulativeawardsof$50millioninthepriorfiscalyear.Therelateddisclosurerequirementalsoissetat$50million.CAS-coveredcontractorsthatdonotmeetthe$50millionthresholdaresubjecttoamodifiedformofcoveragethatrequiresadherencetofourofthestandardsandtotheproceduresregardingaccountingchanges.

Firmfixed-pricecontractsareexemptfromCAScoverageiftheyareawardedonthebasisofadequatepricecompetitionwithoutsubmissionofcertifiedcostorpricingdata.Otherexemptionsalsoapply.Forexample,allcontractawardstosmallbusinessesareexemptfromCAScoverage.AgenciescanwaiveCASapplicabilitytocontractsvaluedatlessthan$15millionwithcompaniesthatsellprimarilycommercialitems.TheagenciesalsohaveflexibilitytowaiveCASonhigher-valuedcontracts.

Thedollarthresholdsandexemption

展开阅读全文