Policies and Procedures for Federal Contractors

Transcription

1 Policies and Procedures for Federal Contractors Presented by CohnReznick s Government Contracting Industry Practice Rebecca Kehoe, Esq., Manager & David Black, Partner, Holland & Knight

2 PLEASE READ This presentation has been prepared for information purposes and general guidance only and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and CohnReznick LLP, its members, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it. This presentation and its content are the property of CohnReznick LLP and are protected by applicable copyright laws. Any unauthorized use of the information herein will be considered a violation of CohnReznick LLP s intellectual property rights. Unless stated otherwise herein, no part of this presentation may be copied, distributed, or published, in whole or in part, without the prior written agreement of CohnReznick LLP. 1

3 AGENDA Goals: Corporate vs. Federal What are Policies, Procedures and Controls? Why Do Federal Contractors Need Them? How Do They Help Achieve the Goals? Which Ones are Important to Have? What does the Federal Government Require? What are Best Practices for your Compliance Program? Questions? 2

4 GOALS:CORPORATIONS VS. FEDERAL GOVERNMENT 3

5 WHAT S IN THE OVERLAP? Corporations: Policies Procedures Controls Federal Government: Law, Regulations and Guidance Code of Federal Regulations Federal Acquisition Regulations OMB 4

6 WHAT ARE POLICIES, PROCEDURES AND CONTROLS? Policies: Guidelines by which employees are to conduct themselves and conduct business for their employer Procedures: The steps to be taken by the employee to ensure the Policies are being implemented Controls: The steps taken by the employer to ensure the employees are meeting the requirements of the Policies and Procedures 5

7 WHY DO FEDERAL CONTRACTORS NEED POLICIES, PROCEDURES AND CONTROLS? Pre-2007: Voluntary Compliance & Disclosure 2007: Mandatory Code of Conduct 2008: Mandatory Disclosure 2008: Mandatory Compliance Program 2009: FCA Amendments 2010: Proposed OCI Regs 2010: Proposed PCI Regs 6

8 WHY DO FEDERAL CONTRACTORS NEED POLICIES, PROCEDURES AND CONTROLS? July 2009: DCAA revises audit guidance to review contractor compliance programs Sept 2009: GAO recommends DFARS amendment to authorize DCMA to review compliance programs 7

9 WHY DO FEDERAL CONTRACTORS NEED POLICIES, PROCEDURES AND CONTROLS? Plus, another unique risk when the Government is your customer 8

10 WHY DO FEDERAL CONTRACTORS NEED POLICIES, PROCEDURES AND CONTROLS? 9

11 HOW DO POLICIES, PROCEDURES AND CONTROLS HELP TO ACHIEVE THE GOALS? Corporations: Improved Efficiency Improved Morale Enhance Profit Federal Government: Compliance with Law and Regulations Enhance Efficiency Focus on Mission 10

12 WHAT POLICIES SHOULD FEDERAL CONTRACTORS CONSIDER? 11

13 FINANCIAL MANAGEMENT Accounting Policy FAR Part 30 Cost Accounting Standards (CAS) Administration FAR Part 31 Contract Cost Principles and Procedures Proper segregation of costs-direct vs. Indirect and Job cost Allocation of indirect costs Accumulation of costs under General Ledger control Timekeeping System / Labor Distribution Exclusion of Unallowable Costs Costs by Contract Line Item (when applicable) Policies and Procedures to ensure proper and adequate billings Generally Accepted Accounting Principles (GAAP) compliant 12

14 FINANCIAL MANAGEMENT Purchasing Policy Competition vs. sole source justification Record keeping Prime Contract flowdown clauses and provisions Debarred, suspended, ineligible vendor certification Processing Changes/Modifications Government Property Administration Representations and Certifications Small Business Subcontracting Subcontract Management/Administration/Close-Out 13

15 FINANCIAL MANAGEMENT Estimating Policy FAR Sub-Part 15.4 Contract Pricing Cost Estimate Development Summary of Total Cost by Element Cross-referenced to each line item Breakdown of Labor (FAR , Table 15-2 II.B.) Hours Rates and Costs by Appropriate Category Consolidated Priced Bill of Materials Types, Quantities, Cost FAR , Table 15-2 II.A. Monitoring/Internal Audit and Training 14

16 BUSINESS DEVELOPMENT Restrictions on Requesting Source Selection Information and Contractor Bid & Proposal Information Restrictions on Gratuities and Bribes Restrictions on Employment Discussions with Federal Employees 15

17 BUSINESS DEVELOPMENT Organizational Conflict of Interest: Assessment, Disclosure, and Mitigation Foreign Corrupt Practices Act Subcontractor Kickbacks Restriction on Contingent Fees Limitation on Payments to Influence Certain Federal Transactions 16

18 GSA SCHEDULES Price Reductions Clause Reporting and Compliance Industrial Funding Fee Reporting and Compliance 17

19 CONTRACT PERFORMANCE Timekeeping Quality Assurance Intellectual Property and Data Rights Marking and Protection National Industrial Security Program Operating Manual Export Controls (ITAR) Contractor Past Performance Information 18

20 SOURCING Buy American Act and Trade Agreements Act Compliance Berry Amendment Restrictions Small Business Subcontracting Program Compliance Mandatory FAR Clause Flowdown Requirements Restrictions on Subcontractor/Vendor Gratuities 19

21 HUMAN RESOURCES Applicability of Labor Laws to Federal Acquisitions (FAR Part 22) Safety Personal Facility Information Equal Employment, Nondiscrimination, and Affirmative Action Requirements Child and Convict Labor 20

22 HUMAN RESOURCES Service Contract Act Requirements (if applicable) Employment Eligibility Verification Drug-Free Workplace Requirements Whistleblower Protections for Contractor Employees Post-Federal Employment Restrictions Applicable to Former Federal Employees 21

23 ETHICS POLICY Code of Conduct Business Ethics Awareness and Compliance Program and Internal Control System Hotline Poster Mandatory Disclosure of Certain Violations 22

24 ETHICS POLICY Responding to Government Investigations and Inquiries Civil False Claims Act (applicable to most functional areas and business processes) Personal Conflicts of Interest 23

25 BEST PRACTICES 24

26 COMPLIANCE PROGRAM CONTROL FRAMEWORK Assign overall responsibility at a sufficiently high level Establish roles and responsibilities for key compliance functions Regular up the chain reporting to the Board or Audit Committee Provide sufficient resources to run the program 25

27 COMPLIANCE PROGRAM KEY CONTROL FUNCTIONS Identify key risk areas Establish Policies and procedures in key risk areas Communicate with employees about the program Train employees who face specific risks Identify and Periodically Audit business processes that pose key risks 26

28 COMPLIANCE PROGRAM KEY CONTROL FUNCTIONS Establish Internal reporting of questions and concerns (anonymous hotline) Promptly respond to internal reporting Investigate and discipline violations Timely Mandatory Disclosure to the government Keep good records of the program Periodic review of the program 27

29 QUESTIONS/COMMENTS 28

30 RESOURCES Rebecca Kehoe, Esq., Manager (703) David Black, Partner, Holland & Knight (703) GovCon360 keeps you abreast of the ever-changing regulatory environment that is Government contracting. From reference materials, like searchable pdf copies of the FAR and DCAM, to our past Lunch and Learn seminar slide decks and thought pieces on industry matters, we ve got it covered. Subscribe to our RSS feed to receive short alerts on recent industry changes. It s always been our job to help our clients maintain a competitive advantage by staying ahead of the curve. This website is an extension of the services we ve been providing for over 35 years by putting useful resources and up-to-date information at your fingertips. 29