Contracts & Legal

Contracting Audit Services


DoD Components, Officials and Program Offices can contract with private auditing services when non-Federal auditors are not available. They should follow requirements described in DFARS Subpart 237.2 – Advisory and Assistance Services (Reference (w)).


Manual: DoD Manual 7600.01-M “DoD Audit Manual” 13 Feb 09 – Enclosure 14


Non-Federal auditors who perform work for the DoD are subject to Generally Accepted Government Auditing Standards (GAGAS) and must be licensed or work for a firm that is licensed in the State or other jurisdiction where they operate their professional practices. Below is a list of the seven (7) main steps for contracting private auditing services.


1. Planning for Procurement of Auditing Services
Planning identifies what audit services are needed, when and how they should be provided, and what provisions should be in the audit services contract. Planning also helps ensure proper information is collected to effectively structure a solicitation package.

2. Communicating Requirements
The solicitation package should be clearly written and set forth all terms, conditions, and evaluation criteria as well as the scope of the work required. The solicitation package should also be well-distributed and -publicized to ensure full and open competition.

3. Review Solicitations
The DoD Component or cognizant DoD audit organization will provide the solicitation package to the Office of the Assistant Inspector General for Audit Policy and Oversight, IG (OAIG APO) for review prior to its release to prospective bidders.

4. Selecting a Contractor and Technical Evaluation
The evaluation process should ensure contractor proposals are responsive to the agency’s needs, consistently and objectively evaluated, and that contracts are awarded fairly. Competent and experienced personnel should be assigned to the technical evaluation panel. When evaluating a solicitation, items to consider include the soundness of the technical approach of the contractor’s proposal, the qualifications of the organization performing the audit service, the qualifications of the team proposed to perform the audit service, the quality control process of the organization performing the audit service, and references provided by the organization performing the audit service.

5. Provide Technical Assistance
The cognizant DoD audit organization should furnish technical advice to the contractor as requested.

6. Monitor Performance
The DoD audit organization should develop appropriate guidelines for their staff to monitor contract performance and provide input to the contracting officer for contractor interim and final performance reporting, deliverables, and payment. Any adverse conditions found during contract performance should be reported to the contracting officer and the users of the services. In addition, the cognizant DoD audit organization should perform an acceptance review of completed audit work before final contract payment is made.

7. Debarment, Suspensions, and Referrals
Substandard work by a non-Federal auditor may warrant referral for sanctions by the appropriate State licensing authorities or suspension and debarment by the contracting authority. The Assistant Inspector General for Audit Policy and Oversight is the only official authorized to make referrals for sanctions by appropriate licensing authorities.


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Updated: 6/1/2018

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