# DCAA Newport News Identifies Improper Contractor Charges

The Defense Contract Audit Agency (DCAA) Newport News Virginia Branch Office completed a fiscal year 2024 cost review of government contracts totaling $21.3 million and identified $288,000 in improper contractor charges primarily related to misclassified bid and proposal expenses. This audit finding led the Department of Energy (DOE) to request two additional audits, signaling heightened federal scrutiny on contractor cost classifications and billing accuracy. Procurement professionals and contractors should prioritize rigorous cost accounting practices and transparent expense reporting to mitigate questioned costs and support compliance with federal audit standards.

- The DCAA's detailed data analysis and communication resulted in full government agreement on the questioned costs, underscoring the importance of audit readiness and accurate cost segregation.
- DOE's follow-up audit requests indicate increased oversight that may affect contract administration and risk management for contractors working with federal agencies.
- Contractors should review and adjust their bid and proposal cost accounting methods to avoid improper charges and potential financial liabilities.
- Procurement officials can leverage these audit insights to enhance contract monitoring and ensure contractor adherence to cost principles.

**Jurisdictions:** federal
**Industries:** Defense & Military
**Topics:** Regulatory Compliance
**Published:** September 23, 2026

### Government Entities
- Defense Contract Audit Agency (DCAA)
- Department of Energy (DOE)

### Sources
- [Newport News audit team identifies improper contractor charges in government cost review](https://tradersunion.com/news/financial-news/show/3462141-newport-news-audit-contractor-costs) - Traders Union
- [
	Newport News Audit Team Finds $288K in Improper Charges > DCAA > Article View
](https://www.dcaa.mil/Agency-News/Article-View/Article/4609471/newport-news-audit-team-finds-288k-in-improper-charges/) - DCAA