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FAC Number: 2022-08
Effective Date: 09/23/2022

Subpart 42.1 - Contract Audit Services

42.101 Contract audit responsibilities.

      (a) The auditor is responsible for-

           (1) Submitting information and advice to the requesting activity, based on the auditor’s analysis of the contractor’s financial and accounting records or other related data as to the acceptability of the contractor’s incurred and estimated costs;

           (2) Reviewing the financial and accounting aspects of the contractor’s cost control systems; and

           (3) Performing other analyses and reviews that require access to the contractor’s financial and accounting records supporting proposed and incurred costs.

      (b) Normally, for contractors other than educational institutions and nonprofit organizations, the Defense Contract Audit Agency (DCAA) is the responsible Government audit agency. However, there may be instances where an agency other than DCAA desires cognizance of a particular contractor. In those instances, the two agencies shall agree on the most efficient and economical approach to meet contract audit requirements. For educational institutions (defined as institutions of higher education in the OMB Uniform Guidance at 2 CFR part 200, subpart A, and 20 U .S.C. 1001) and nonprofit organizations (as defined in the OMB Uniform Guidance at 2 CFR part 200), audit cognizance will be determined according to the provisions of the OMB Uniform Guidance at 2 CFR part 200, subpart F.

42.102 Assignment of contract audit services.

      (a) As provided in agency procedures or interagency agreements, contracting officers may request audit services directly from the responsible audit agency cited in the Directory of Federal Contract Audit Offices. The audit request should include a suspense date and should identify any information needed by the contracting officer.

      (b) The responsible audit agency may decline requests for services on a case-by-case basis, if resources of the audit agency are inadequate to accomplish the tasks. Declinations shall be in writing.

42.103 Contract audit services directory.

      (a) DCAA maintains and distributes the Directory of Federal Contract Audit Offices. The directory identifies cognizant audit offices and the contractors over which they have cognizance. Changes to audit cognizance shall be provided to DCAA so that the directory can be updated.

      (b) Agencies may obtain a copy of the directory or information concerning cognizant audit offices by contacting the-

     Defense Contract Audit Agency ATTN: CMO Publications Officer 8725 John J. Kingman Road Suite 2135 Fort Belvoir, VA 22060-6219.

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