Paul, in setting up accounting systems, I always recommend that the company have a lag between the timesheet cutoff date and the payday, so that the employee’s hours can be collected and paid based on timesheets.

However, if a company chooses to keeps its payday, and if all their employees are salaried, are they technically forecasting time.  Example, they have to send payroll data on Friday, August 10 for hours thru August 15th.  So to me, they are forecasting Monday Aug 13 to Wednesday August 15. 

Will this cause problems’ with DCAA or is it ok as long as the employee completes their timesheet daily and signs before they submit the hours for billing?

My concern is that if they are doing this for hourly employees in the future then they’ll run into problems with an auditor.


The biggest issue, to me, would be the administrative effort required to check all of the timesheets again each payroll period to verify that all employees worked the hours projected.  This would have to be done as part of each timesheet review process prior to the next payroll to make appropriate adjustments.

I feel it matters not as much if they are hourly or exempt, except for DOL purposes.  It matters more if they work either Direct or Direct & Indirect.

I agree with you that timesheet cut-off date should be in advance of payday.  This is based on experience and the many problems that I have seen come up that most people think will never happen to them.  It is more a recommendation based on experienced judgement.

The DCAA/DCMA or any other agency, including DOL, could insist that the potential for fraud, error, and additional cost through increased administrative effort, results in an unreasonable process.  It would be their opinion, and a company could defend it through very, very, good records and internal controls.

But why bother with this when a simple matter of changing a timesheet cutoff date would resolve the matter.  There would be only one pay period that employees would have to adjust for.


Hope this helps