DCAA Timekeeping Requirements for Government Contractors
The Defense Contract Audit Agency (DCAA) sets strict timekeeping requirements for government contractors. Non-compliance can lead to disallowed costs, contract termination, or debarment. Hour Timesheet is purpose-built to meet every DCAA timekeeping requirement — so you stay compliant without the headache.
DCAA Timekeeping Requirements
The following requirements are essential for DCAA compliance:
Daily Time Recording
Employees must record time daily as work is performed — not weekly or retroactively.
Employee Attestation
Employees must certify their time records are accurate and complete with an electronic signature each pay period.
Supervisor Approval
Supervisors must review and approve timesheets, verifying accuracy against work assignments.
Complete Audit Trail
Every change to a time record must be logged with a timestamp, user ID, and reason for the change.
Cost Segregation
Direct labor charged to contracts must be clearly separated from indirect labor such as overhead and G&A.
Job Cost Accounting
Time must be tracked against specific contracts, tasks, and CLINs for proper cost allocation.
Correction Procedures
Timesheet corrections must follow documented procedures with proper approvals and justifications.
Record Retention
Time records must be retained for the period specified in the contract (typically 3+ years after contract closeout).
Best Practices for DCAA Compliance
Follow these best practices to ensure your organization maintains DCAA compliance:
1. Use DCAA-Compliant Software
Use time tracking software specifically designed for DCAA compliance. Generic tools typically lack audit trails, attestation, and proper cost segregation.
2. Train Your Employees
Train employees regularly on accurate daily time entry and the consequences of non-compliance.
3. Conduct Internal Audits
Audit your timekeeping system regularly to catch and correct issues before a DCAA auditor does.
4. Establish Clear Policies
Document your timekeeping policies and procedures, and make them easily accessible to every employee.
5. Separate Direct and Indirect
Maintain clear job codes and cost categories to ensure proper segregation of direct and indirect labor costs.
How Hour Timesheet Simplifies DCAA Compliance
Hour Timesheet provides all the features you need to meet DCAA timekeeping requirements. Our software is purpose-built for government contractors with compliance in mind.
✓ Automated Daily Reminders
Automated email reminders prompt employees to complete their daily time entries — ensuring contemporaneous recording.
✓ Electronic Attestation
Customizable attestation statements set by your admin, with electronic signature at timesheet submission.
✓ Manager Approval Workflow
Configurable approval routing ensures every timesheet is reviewed and approved before processing.
✓ Complete Audit Trail
Every entry, edit, and approval is logged with timestamps and user IDs for full traceability.
✓ Indirect Cost Tracking
Track overhead, G&A, and other indirect labor categories separately from direct contract labor.
✓ Mobile Time Entry
Employees can record time from anywhere — keeping daily compliance on track, even in the field.
Free Setup & Training Included
Every Hour Timesheet subscription includes free setup assistance to make sure your system is configured correctly for DCAA compliance. Our team helps you set up job codes, approval workflows, and compliance features — and provides ongoing training and support at no extra cost.
Frequently Asked Questions
What is DCAA compliance?
DCAA compliance means meeting the timekeeping and accounting standards set by the federal government for contractors on government contracts. Non-compliance can result in disallowed costs, contract termination, or debarment.
How often must employees record their time?
The DCAA requires employees to record time daily, as work is performed. Recording time weekly or after the fact does not meet compliance requirements.
What happens during a DCAA timekeeping audit?
Auditors will review your timekeeping system, policies, and records. They verify that employees record time daily, that proper approvals exist, that direct/indirect costs are segregated, and that a complete audit trail is maintained.
Does Hour Timesheet guarantee DCAA compliance?
Hour Timesheet provides every feature required for DCAA-compliant timekeeping. However, compliance also depends on your internal policies and how employees use the system. We include free setup assistance to help you configure everything correctly from the start.