History
Audits of military contracts can be traced back 60 years or more. Initially, the various branches of the military had their own contract audit function and associated instructions and accounting rulings. Uniformity was non-existent. Contractors and government personnel recognized the need for consistency in the areas of contract administration and audit.
The U.S. Navy and Army Air Corps made the first attempt to perform joint audits in 1939. By December 1942, the Navy, Army Air Corps, and Ordnance Department had established audit coordination committees for selected areas where plants were producing different items under contracts for more than one service.
On 18 June 1952, the three military services jointly issued a Contract Audit Manual (CAM). The Manual prescribed detailed policies and procedures for use in auditing procurement contracts. Because of differences between the procurement organizations and practices of the services, finalizing standard guidelines was difficult.
In May 1962, Secretary, Department of Defense, Robert S. McNamara instituted "Project 60" to examine the feasibility of centrally managing the field activities concerned with contract administration and audit. An outcome of this study was the decision to establish a single contract audit capability.
On 8 January 1965, the Defense Contract Audit Agency (DCAA) was formed. Mr. William B. Petty, formerly the Deputy Comptroller of the U.S. Air Force, was selected as the Director with Mr. Edward T. Cook, formerly Director of Contract Audit for the Navy, selected as the Deputy Director.
Read more about this topic: Defense Contract Audit Agency
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