Letters, numbers, acronyms, and more. It’s like a GovCon fairytale minus the lions, tigers, and bears. Oh my!
Today we’re discussing SF1408. What is it and why is it something you should be familiar with?
A 1408 assessment is the Pre-Award Accounting System Survey (SF1408). The Accounting System Survey is sometimes referred to as a “pre-award audit” and it is necessary for the award of any Cost Type contract.
A few points to note:
• This comes BEFORE contract award.
Imagine losing a bid because you didn’t have your act together in your financials!
• This is not an audit.
They (DCAA) focus on your accounting system’s ability to be compliant if you were to receive the award. It is simply a review to determine if your system is set up and operating in accordance with the criteria on page 2 of Standard Form 1408.
• This is where policies and procedures rule (Here’s a tip: an accounting system is not just the software being utilized).
DCAA is looking for you to document what your system does – think segregation of indirect vs. direct costs and unallowables (our favorite); how are costs captured and classified?; how and where do you charge your time?
If you plan on priming this year on a Cost Type contract or are awarded a cost type subcontract (looking at you DOD peeps!), make sure you are prepared with documented policies and a compliant accounting system.
Note that this is different than an Accounting System Audit! An audit of your accounting system is much more in-depth and includes tests of internal controls (e.g., segregation of duties, etc.). Know what you need when you read through the RFP. If you have a question, ask the COR during the Q&A time – the difference between the two is huge!
Do you still have questions or want to discuss this as it pertains to your business specifically? Contact us here.