Earned Value Management (EVM)
A reliable EVMS system is critical to your ability to produce reliable and verifiable contract performance data consistent with DFARS contract performance reporting and scheduling requirements. Our company will serve as your accounting and government regulation compliance experts to ensure that your EVMS system adheres to systems criteria recently implemented by the Department of Defense (DOD), and certain civilian agencies such as the Department of Energy (DOE) and National Aeronautics and Space Administration (NASA).
Our objective is to ensure that your company has a fully compliant EVMS system that consistently produces timely and reliable performance data to help you manage contract performance in a cost effective manner. We can help ensure your EVMS system provides performance data that results in sound management decisions and help mitigate the risk of withholdings from progress payments and contract billings for failing to comply with newly implemented regulations. DFARS regulations governing EVMS system requirements are very complex. To be acceptable, DFARS 252.234-7002 currently requires the EVMS system to fully comply with 32 separate guidelines contained in the American National Standards Institute/Electronic Industries Alliance Standard 748 including:
- Defining the authorized work elements for the program. A work breakdown structure (WBS), tailored for effective internal management control, is commonly used in this process.
- Identifying the program organizational structure including the major subcontractors responsible for accomplishing the authorized work, and define the organizational elements in which work will be planned and controlled.
- Providing for the integration of the company’s planning, scheduling, budgeting, work authorization and cost accumulation processes with each other, and as appropriate, the program work breakdown structure and the program organizational structure.
- Providing for integration of the program work breakdown structure and the program organizational structure in a manner that permits cost and schedule performance measurement by elements of either or both structures as needed.
- Scheduling the authorized work in a manner which describes the sequence of work and identifies significant task interdependencies required to meet the requirements of the program.
- Identifying physical products, milestones, technical performance goals, or other indicators that will be used to measure progress.
- Establishing and maintaining a time-phased budget baseline, at the control account level.
- Establishing budgets for authorized work with identification of significant cost elements.
- Identifying and controlling level of effort activity by time-phased budgets established for this purpose.
- Establishing overhead budgets for each significant organizational component of the company for expenses which will become indirect costs.
- Recording direct costs in a manner consistent with the budgets in a formal system controlled by the general books of account.
- When a work breakdown structure is used, summarize direct costs from control accounts into the work breakdown structure without allocation of a single control account to two or more work breakdown structure elements.
- Identify unit costs, equivalent unit costs, or lot costs when needed.
An accounting system that provides for accurate cost accumulation and assignment of costs to control accounts in a manner consistent with the budgets using recognized, acceptable, costing techniques and cost performance measurement at the point in time most suitable for the category of material involved, but no earlier than the time of progress payments or actual receipt of material.
- Identifying, at least monthly, the significant differences between both planned and actual schedule performance and planned and actual cost performance, and provide the reasons for the variances in the detail needed by program management.
- Identifying budgeted and applied (or actual) indirect costs at the level and frequency needed by management for effective control, along with the reasons for any significant variances.
- Reconciling current budgets to prior budgets in terms of changes to the authorized work and internal replanning in the detail needed by management for effective control.
- Controlling retroactive changes to records pertaining to work performed.
- Preventing revisions to the program budget except for authorized changes.
- Documenting changes to the performance measurement baseline.
Redstone Government Consulting has unparalleled expertise in government contracting compliance, including over 160 years of senior level DCAA experience. We have also access to exceptional engineering and technical expertise to assist, as needed, in the evaluation of the engineering and technical aspects of EVMS systems providing us with an unrivaled ability to ensure your EVMS system complies with DFARS 252.234-7002 and other FAR and DFARS regulatory requirements.
Some of the services we provide to meet your EVMS system compliance needs include:
- Designing and/or implementing a new tailored EVMS system, or updating the existing system for process improvements.
- Preparing written EVMS system policies, procedures, and detailed staff instructions.
- Risk assessments and GAP analysis of your current EVMS policies, procedures, and practices.
- Mock audits of your EVMS system using procedures that mirror DCAA/DCMA procedures for evaluating EVMS systems.
- Developing and implementing appropriate corrective action plans.
- Developing and delivering customized staff training.
- Responding to DCAA/DCMA/Independent CPA audit findings and contracting officer inquiries.
- Advice and assistance to supplement, as needed, internal compliance department knowledge and expertise.
- Strategic planning assistance.