INQUIRY: I was given your address by our President. We are in the middle of writing a proposal to FEMA, and in the RFP, it’s requesting : “copies of our most recent audited Indirect Rate Agreement.” Are they speaking of our last Financial Audit, and proof how we arrived at the G&A rate, or is it actually the rate that a gov’t official signed off on?
RESPONSE:
They are most likely talking about a DCAA or other Government audit of your Indirect Rates. Typically, you would know if you had this audit. It is not your Financial Audit by a CPA or Tax person.
It is an audit of how you arrive at your Indirect Rates (Fringe, Overhead, G&A, etc.) as applicable.
If you have not had a DCAA audit, or if you do not have an Indirect Rate Agreement, then clearly state so to FEMA. You cannot typically request this type of audit from the government. The CO or ACO or Prime has to request this type of audit.
The best you can do is state that your rates are established in accordance with the requirements of the DCAA and that you are open to audit. What I do for firms at their request is to review their indirect rate calculations, and accounting system structure so they can have a better understanding of the likelihood of passing the audit. This includes the documentation of typical existing or planned policies.