The consequences of DCAA noncompliance can be severe.. One of the best ways to help you stay in compliance is electronic timekeeping. Read our article to learn the benefits of electronic timekeeping.
Special rules for electronic timekeeping
For DCAA, there are a few rules that apply to electronic time tracking that don’t apply to paper timecards:
- Passwords: You must require a password at login. Passwords should also change frequently, at least every six months.
- Individual control: Every employee should have control over their own electronic timesheet.
- Audit ability: Digital time tracking software should allow the ability to see all transactions made.
- Track changes feature: Any software used should prompt employees to list any reason that they are making changes to their timesheet.
- Ability to Attach Other Documents - The electronic timekeeping system you use must allow additional documents to be attached to and stored with time cards.
The benefits of an electronic time tracking system
Electronic timekeeping streamlines your time tracking tasks, makes reporting easier, and leaves less room for error.
Here’s how a digital time tracking solution can make timekeeping for government contractors easier:
Electronic time tracking is more accurate
With an electronic timekeeping system you don’t have to worry whether or not your employees can write legibly. You also don’t have to worry about timesheets getting lost or hours being forgotten before they’re written down.
Some time tracking software uses GPS and reminds employees to clock in as soon as they’re on site. This makes it much harder for employees to forget to track their time. And the data is stored instantly.
Digital time tracking eliminates redundant tasks
Software makes record keeping much simpler. There’s no need for supervisors to track down employees and round up paper time cards. There’s no need for office staff to manually enter data from timesheets into bookkeeping software or to create reports.
Instead the data is stored in the cloud and easily accessible to upload into other programs.
Software streamlines many human resource tasks
Timesheet approvals, time off requests, scheduling tasks—you can handle all of that online. And automating these tasks frees up your human resource (HR) office for more important tasks.
Digital records are more secure
Paper timesheets are easy to lose, damage, or falsify. Electronic records are stored safely in the cloud so they won’t get lost or damaged. And they can’t be easily changed or edited without being approved first.
Creating proposals is easier
Accurate labor hours make proposals easier to calculate. And storing time and job costing information electronically makes all the information you need to create proposals more easily accessible.
Staying DCAA compliant is easier
Having an electronic timekeeping system makes following DCAA timekeeping requirements much simpler. Not only can you track time more accurately, but you can create timekeeping and labor reports with the touch of a few buttons.
Consequences for noncompliance
The consequences for non compliance range from mild to severe. Some broken rules might only lead to lost contracts, but others could land you in jail.
Here are a few of the consequences you could face if you aren’t DCAA compliant:
Ineligibility to bid for contracts:
Before you can be a government contractor, you have to prove that you know, understand, and follow DCAA timekeeping requirements. If you aren’t compliant, then you won’t pass the auditing process—making you ineligible to win contracts.
Once you’ve secured a government contract, you can count on being audited by DCAA several times during the course of the project.
If the audit shows you haven’t been acting in the best interests of the government, they can terminate your contract.
If the audit uncovers any of the following, it will show you have gone against the government’s best interests:
- Fraud or attempted fraud
- Low quality work
- Not providing services or delivering goods within the timeline in the contract
- Not meeting the provisions of the contract in any way
If you’re repeatedly found to be noncompliant, you can be permanently disbarred as a government contractor. This means that you would be ineligible to bid on future government contracts because of irresponsible behavior.
Some forms of noncompliance result in civil penalties and fines, especially those in cost reimbursable contracts. Cost-reimbursable contracts contain a penalty clause that states if a disallowed cost is listed in a submission, then the cost will be struck from the contract. And the contractor will be fined for 100 percent of that cost.
Timekeeping irregularities lead to more criminal investigations than any other discrepancies.
If a timecard is found to be fraudulent in any way, then both the employee and supervisor who signed it could face up to five years in prison.
While working government contracts has some risks, it’s easier to stay in compliance with electronic timekeeping. ClockShark is a cloud-based timekeeping and scheduling app. It’s designed to help construction and field service companies save time and money by streamlining the time tracking and scheduling process. The GPS-based time tracking system helps keep timesheets as accurate as possible. And the built-in approval process makes sure timesheets are approved by a designated administrator or supervisor. Check it out by starting a 14-day free trial and see the difference it can make for your business.