The government requires submittal of your Incurred Cost Proposal (ICP) six months after your fiscal year ends. Extensions may be granted, but only by securing a written agreement of your Contracting Officer. (FAR 52.216-7(d)(2))
Once the ICP is complete, we advise you submit a PDF version to your Contracting Officer (CO) and Administrative Contracting Officer (ACO) found on your contract. Submit the Excel version directly to the DCAA office that audits your operation.
DCAA Notification of Inadequacy
Many times the DCAA will respond with a notification of inadequacy which asks for clarity or corrections to the submitted proposal. We find auditors are very open about discussing what these issues are and their source of confusion. Typically they comment on financial information that is not reconciling between schedules, i.e. worksheets in the Excel model, or simple format changes or the depiction of data.
Submitting ICP Updates
It may take years after you first submit your ICP before the DCAA audits the claim. Should changes occur that affect the report within that time(cost treatments, billing information...) you'll need to decide if you should resubmit the ICP. A good rule of thumb is materiality. If the changes dramatically change the calculated indirect rates, a resubmission is likely warranted. Bear in mind even if the rates change by a percentage point, you must re-sign the Schedule N certification.
It’s never too early to get a head start! There are a number of ways you can be proactive!
- Call Tech BizSolutions today at 303-867-8125, for a free evaluation!
- Download and review any of our free Incurred Cost checklists on this and other related pages.
- Send us an email that includes some basic information: your company's size, number of employees,number of government jobs and type of contracts, the type of accounting software you use, whether or not you did provisional rates last year, and the type of rate structure you've used in the past (1, 2 or 3 rate system).
For additional guidance, go to:
DCAA looking to reduce ICP backlog in 2012
How to prepare your ICP
Preparing for a DCAA ICP audit