For government contractors, it is very important to track and maintain their time keeping records that are adequate for audit purposes.
The following is a list of items found in the DCAA Contract Audit Manual - which can be found at: http://www.dcaa.mil/cam/Chapter_05_-_Audit_of_Accounting_and_Management_Systems.pdf
The document is also attached to this article.
If you look in the DCAA Contract Audit Manual Chapter 5 you will find very specific requirements that the DCAA will look for in a timekeeping system (Para 5-908 & 909). This requires procedures for the proper use, controls, preparation of and recording of actual times worked. DCAA auditors will be looking to see that:
- All hours worked for all employees are recorded (this includes all direct and all indirect work)
- The proper job assignments are made by different individuals than are performing the work (to the extent practical)
- Daily recording of time worked by the employee
- An audit trail for any & all changes exists
- Employee review and approval of the time recorded
- Supervisor review and approval of the employee's time recorded
- Evaluation of labor distribution
- Reconciliations between the distribution summary and the labor charges
- Procedures to assure all hours worked (even if they are not billable) are recorded