DCAA Relations

The Evidence Seems to Indicate More Honest Contractors then Competent DCAA Auditors

March 18, 2013

I notice an ongoing theme in the recent GAO and DOD OIG reports concerning DCAA. In each of the major reports ALL of the DCAA mistakes appear to benefit the contractor. Reading these reports gives the impression that there is a ‘free lunch’ out there for contractors to take advantage of taxpayers as DCAA dissolves into the blood pudding that is DOD.

All of us realize this is not true. As often, if not more so, DCAA’s mistakes harm contractors causing specific damages. I will elaborate on in a moment.

First, why are GAO and the OIG not documenting mistakes that harm contractors? First, I believe they are and GAO and OIG are deliberately leaving DCAA mistakes that harm contractors out of their reports. As a taxpayer I understand their rationalization for this action.

1)      DCAA is making so many mistakes that reporting those that hurt contractors are unnecessary to documenting DCAA’s problems and could even harm the improvement process.

i.      Really, what is the difference between several hundred mistakes on over a hundred audits as compared to a couple of thousand mistakes on a couple of hundred audits?  We get it, DCAA is having problems and the scope is large enough to generate major concerns. Any other reason aside, kicking someone when they are down is usually a waste of energy.

2)      If contractors thought for a moment that they could solve their DCAA problems by calling their local member of Congress or the OIG, I believe phones would start ringing off the hook at those respective offices. Using the rationalization I espouse in point one: GAO and the OIG can work on DCAA’s problems without opening the floodgates.

3)      One would also hope that while the contractor harming work is not emphasized in the reports, DCAA is aware of this and the rationalizations for not reporting it. I really cannot believe in DCAA auditors who take the position that we only make mistakes that benefit contractors.

On the assumption I have this all wrong and GAO, OIG, and DCAA all believe the mistakes only benefit contractors, let me make a point:

Bad audits hurt everyone to include the contractors who allegedly benefit. A contractor should be able to create and maintain a reasonable understanding of compliance.

In an audit environment where:

  • DCAA can twist the FAR into saying anything they wish,
  • where they fail to comply with their own standards,
  • and where audits are never completed,

a world of chaos is created that adds dramatically to the cost of business.

The more time contractors have to spend figuring out what DCAA is going to screw up next is more costs to the G&A pool, more costs to the contractors, and more cost to taxpayers.

This is not an environment that supports honest contractors. Also, the government (GAO, OIG, and DCAA) is selling itself short to pretend there is no such thing as an honest contractor.

The evidence seems to indicate more honest contractors then competent DCAA auditors.


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