Budgeting and Planning System

DCAA Findings

A. Contractor has written policies and procedures for preparing budgets at the corporate and industry level. However, these written policies and procedures are not adequate in the following respects:

• The written policies and procedures provide an overview of the work flow of the budget and planning process; however, they do not contain sufficient information for a thorough understanding of the budget and planning operation. For example, they do not clearly identify:

• The responsibilities of the parties involved,

• The process for incorporating corporate costs that are allocated to industries.

• The sources for the "built-in" items in the budget model, and

• The changes made each year.

• The written policies and procedures do not address the development of strategic and long-range plans and the use of strategic and long-range plans in developing budgets for each fiscal year.

• The written policies and procedures do not address monitoring the budget and planning system.

• The written policies and procedures do not adequately address distribution of relevant budget information to individual managers responsible for meeting budgetary objectives and monitoring personnel.