One Agency, One Team, One Direction
Real-Time
Labor Evaluations
The views expressed in this presentation are DCAA's views and not
necessarily the views of other DoD organizations
Further information is available in the
Information for Contractors Manual under Enclosure 2, Section 4
One Agency, One Team, One Direction
Real-Time Labor Evaluation
What is a Real-Time Labor Evaluation?
Why does DCAA perform them?
What will you need to provide?
Will you receive advance notification?
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One Agency, One Team, One Direction
What is a Real-Time Labor
Evaluation?
Evaluation includes:
Evaluating timekeeping procedures/internal
controls
Employee interviews
Discussing the nature of work performed
Observations of the employee’s workstation
Analysis of employee timekeeping practices
Reconciliation of labor charges with subsequent
payroll and labor distribution records
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One Agency, One Team, One Direction
Why Does DCAA Perform
Real-Time Labor Evaluations?
To test for compliance with timekeeping controls
Deficiencies addressed on a real-time basis
Analysis of current labor charging and cost
allocation practices
In support of Incurred Cost Audits, performed at a
later date
To determine the accuracy of labor charges to
contracts, indirect accounts, or other cost objectives
Evaluation performed on a real-time basis since
employees are more likely to remember recent events
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One Agency, One Team, One Direction
What Will You Need to Provide?
A current list of employees & their locations
Timekeeping procedures
Procedures for Work at Home program
(telecommuting)
A Point of Contact for employee interviews
Will also need an alternate point of contact
Separate point of contacts for each location
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One Agency, One Team, One Direction
Will You Receive Advance
Notification?
Labor evaluations are unannounced so we
will not call in advance to let you know we are
coming or ask for a convenient time to meet.
The auditor will arrive at your location and
request to meet with the point of contact.
The auditor will request to interview
employees at their assigned workstation.
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One Agency, One Team, One Direction
Impact of Work at Home Program
If employee selected for interview is working at home:
Employee’s supervisor interviewed to verify control
over employee’s work at home schedule
Auditor will speak to employee over the telephone:
Discuss work at home procedures
Discuss specific work being performed
Request charge number(s) for work performed
Auditor may also interview employee during a
follow-up visit
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One Agency, One Team, One Direction
Purpose of Employee Interviews
Verifying employees exist and are at work
Labor charges are to the appropriate cost
objective
Verifying employees are performing in
assigned job classifications
Determine if the recorded labor hour charges
are a fair representation of the work
performed
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One Agency, One Team, One Direction
Examples of Interview Questions
Current job title
Description of current projects
Period of performance for current projects
Charge numbers/accounts used to record
time spent on each project
Percentage of time on each project
Explain the procedure for revising timesheet
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One Agency, One Team, One Direction
DCAA Labor Evaluations
The auditor will ask the employee for a copy of
their timesheet upon arrival at their workstation
or request the employee open their timekeeping
application and input screen
Other items the auditor may request include:
Copies of timekeeping procedures
Written descriptions of current projects
Employee identification number
Authorization for charging current projects
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One Agency, One Team, One Direction
Labor Evaluation Procedures
Auditor may also question management, accounting,
or other personnel to further clarify or confirm the
employee’s statements
The auditor will concentrate on the following:
Employee’s understanding of timekeeping procedures
Procedures for receiving work assignment charge
numbers and descriptions
How often the employee completes their timesheet
Whether the employee incudes all hours worked
Timesheet submission/approval process
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One Agency, One Team, One Direction
Real-Time Labor Evaluations
Other standard audit procedures include:
Performing a follow-up of employees that
were unavailable on the day of the floor
check to verify their existence.
Verifying employee time charges
(observations made during the floor check) to
the labor distribution for the pay period floor
checked.
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One Agency, One Team, One Direction
Real-Time Labor Evaluations
Obtaining explanations promptly concerning
all questionable procedures & practices
observed during the floor check.
If the contractor has multiple locations, the
auditor may coordinate with other DCAA
offices to perform evaluations at off-site
locations.
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One Agency, One Team, One Direction
Contractor Response
Auditor will conduct exit conference to discuss
results of the evaluation
If deficiencies with the DFARS business system
criteria are found, the auditor will furnish a draft
version of findings to be presented in a business
system deficiency report
Contractor is given an opportunity to respond to
findings
Response can be oral or written
Response will be incorporated into the report
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One Agency, One Team, One Direction
Questions/Comments
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