Contractor Software Charges.
Abstract
This audit was performed because computer software costs, as compared with hardware costs, have increased during recent years. Software costs are a major cost element of total contractor automatic data processing costs. Contractors charge the Government approximately $5 billion annually, through indirect rates, for internal contractor automatic data processing activities. Examples of computer software costs that contractors charge through indirect rates are material management systems, security systems, labor accounting systems, and computer-aided design and manufacturing. The Defense Logistics Agency performs technical reviews, and the Defense Contract Audit Agency performs audits of contractor software costs. Our audit objectives were to determine whether existing legislation, regulation, and other authoritative guidance adequately protect the Government's interest with respect to the equitable cost accounting treatment of contractor software costs. We also assessed internal controls over Defense Contract Audit Agency audit coverage and Defense Logistics Agency technical coverage of contractor computer software costs and management's implementation of the DoD Internal Management Control Program as it applied to the audit objectives.
Document Details
- Document Type
- Technical Report
- Publication Date
- Oct 19, 1994
- Accession Number
- ADA374550
Entities
People
- Arsenio Sebastion
- Bobbie S. Wan
- Marc A. Pederson
- Paul J. Granetto
- Richard Jolliffe
Organizations
- Office of the Inspector General, U.S. Department of Defense