Sandia has designated the Contract Audit Department as an independent appraiser responsible for auditing supplier contracts and subcontracts that support the Laboratories’ mission. Contract Audit also provides accounting and financial services in the negotiation, administration, and settlement of costs for contracts placed by Sandia Procurement.
The information and templates below relate to audit processes for contractors, Sandia Contracting Representatives (SCRs), Sandia Delegated Representatives (SDRs), and requesters. Forms can also be found on the Contractor Bidder Information policies page.
For a better understanding of audit material, please view our Glossary of Terms (MS WORD).
Audit Engagement Letter (PDF)
This letter is sent to the contractor by the Contract Audit Department prior to performing an audit and explains its scope and objectives. The letter lists the contract(s) that will be audited and asks that the contractor acknowledge that contract(s) listed represent all of the contractor’s auditable Sandia contracts and that the contractor understands the scope and objectives of the audit engagement.
This letter is obtained from the highest level of the audited entity. The official who signs the management representation letter is the person who, in the auditor's view, is responsible for and knowledgeable, directly or through others, about the matters in the letter. Written representations from management ordinarily confirm oral ones given to the auditor, indicate and document the continuing appropriateness of those representations, and reduce the possibility of misunderstanding. The letter includes representations about financial information, financial statements, internal controls, indirect rates, related party transactions, conflict of interest, and compliance with laws, regulations, and contract terms and conditions. A management representation letter is required by General Accepted Auditing Standards and General Accepted Government Auditing Standards.
Electronic Cost Claim (ECC)
An Electronic Cost Claim is prepared and provided by the contractor to Sandia Contract Audit in preparation for an audit. The document is used to compare and reconcile previously billed and paid amounts shown in Sandia’s accounting system. It also provides the contractor with an additional opportunity to review previous billings to ensure there have not been errors. The ECC is the basis for the statistical audit sample selections made by the auditor. These should be submitted within 90 days of a contractor’s fiscal year end.
- ECC- General Information (MS Excel)
- ECC -Time & Materials Labor Hours Template and Instructions (MS Excel)
- ECC-Cost Reimbursable Template and Instructions (MS Excel)
- ECC-University Template (MS Excel)
- ECC-Indirect Rates (Indirect Rate Cost Claim) (MS Excel)
Electronic Cost Proposal (ECP)
An Electronic Cost Proposal is prepared and provided to the Sandia Contracting Representative (SCR) by a contractor who is bidding on a proposed contract. It contains the proposed total charges or costs necessary to perform the activities being considered in the proposed contract. A preaward audit may be performed based on regulations and/or at the request of the SCR.
SDR – Time & Materials/Labor Hours Tip Sheet (MS Word)
Guidelines for the Sandia Delegated Representative (SDR) when reviewing invoices associated with time and materials and/or labor hours invoices. Tips include what to look for in regard to labor billing rates and labor categories, travel, materials, equipment, and other direct costs to ensure the contractor is billing per the contract terms and conditions and applicable regulations.
SDR - Cost Reimbursable/Fixed Price Tip Sheet (MS Word)
Guidelines for the Sandia Delegated Representative (SDR) when reviewing invoices associated with cost reimbursable and/or firm-fixed price invoices. Guidelines describe what the SDR might expect to see on an invoice and want to consider when reviewing costs or milestone payments to ensure the contractor is billing per the contract terms and conditions and applicable regulations.
SCR – Preaward Audit Tip Sheet (MS Word)
Preaward audit guidelines for the Sandia Contracting Representative (SCR). Tips include what issues need to be resolved before requesting a preaward audit, including exceptions to the contract terms and conditions and common cost proposal problems. Also provided are tips on how to submit a preaward audit request.
Contractors – Contract Records and Audit Findings Tip Sheet (MS Word)
Information sheet describing the types of supporting documentation the contractor might be asked to provide during an audit, and a list describing some common audit findings.