Minnesota Department of Transportation

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Audit

Rates

Overhead rates should be submitted to the Consultant Services Section on an annual basis. Overhead rates can be submitted to professionaltechnicalaudits.dot@state.mn.us, below is an outline of what needs to be submitted depending on how your overhead rate is prepared.

Overhead Rate Submissions

If you have received a Cognizant Overhead Audit from your Home State DOT Audit Office, please submit the following:

  • Overhead Calculation
  • Cognizant Letter from the Home State DOT Audit Office
  • Pre-Award Overhead Rate Questionnaire
  • Financial Statements
  • National Compensation Matrix
  • Certification of Final Indirect Costs
  • Common Control Rent – related party rent, if applicable (in Excel format)

If MnDOT is your Cognizant Agency and you are requesting a Cognizant Review from MnDOT Audit, please contact MnDOT Audit “prior to signing” an Engagement Letter with a CPA. After the overhead rate is ready for review, please submit the following:

When you have hired a CPA to perform your overhead rate calculation, please submit the following:

  • Complete CPA Audited Overhead Rate Report, including the Overhead Calculation
  • Pre-Award Overhead Rate Questionnaire
  • Financial Statements
  • National Compensation Matrix (Excel)
  • Certification of Final Indirect Costs
  • Common Control Rent – related party rent, if applicable (in Excel format)
  • Approval Letters from Other States (If available)

Whereas, if you have prepared your overhead rate in-house, please submit the following:

  • Overhead Calculation
  • Reconciliation of Overhead calculation to financial statements (Expense Section of Profit and Loss, Income Statement, Schedule C, or 1120S)
  • Pre-Award Overhead Rate Questionnaire
  • Financial Statements
    • Balance Sheet
    • Profit and Loss Statement
  • General Ledger
  • Certification of Final Indirect Costs
  • National Compensation Matrix
  • Common Control Rent – related party rent, if applicable (in Excel format)
  • Approval Letters from Other States (If available)

After the MnDOT Office of Audit has approved your overhead rate, we will issue a letter to the appropriate Officer/Employee of the Company, while also copying MnDOT Consultant Services, and our local FHWA Office.

A checklist has been provided for your convenience:

Federal Acquisition Regulations (FAR)

Overhead rates must be in accordance with FAR Part 31.

The Uniform Audit and Accounting Guide 2016 Edition is the most current edition and can be purchased from AASHTO. This guide is beneficial when calculating your overhead rate, since it is the most recent version, and it can be easier to read than FAR.

The Uniform Audit and Accounting Guide 2012 Edition (PDF) is free.

Premium Portion of Overtime

The Premium Portion of Overtime can either be included in the Indirect Labor Costs, the Direct Labor Costs, or Excluded from the Overhead Rate Costs by being part of Direct Expenses.

Facilities Capital Cost of Money

MnDOT does not accept Facility Capital Cost of Money rates, per the Audit Oversight of Consultant Contract Indirect Cost Rates Policy.

Links

Contact

To comply with federal audit requirements, the MnDOT Office of Audit will request any additional information needed from consultants for audits through the Office of Project Management and Technical Support – Consultant Service Section. Any questions from the consultant regarding audits performed should be made directly to the Office of Project Management and Technical Support – Consultant Service Section. The MnDOT Office of Audit will assist the Office of Project Management and Technical Support – Consultant Service Section in addressing any questions/issues that may arise. All questions/inquiries auditors receive from a consultant will be re-directed to the Office of Project Management and Technical Support – Consultant Services Section for assistance.

MnDOT Consultant Services Section
professionaltechnicalaudits.dot@state.mn.us

Frequently asked questions

How often should we submit our overhead rate?

The overhead rate should be submitted on an annual basis.

When does the overhead rate need to be submitted?

We request the overhead rate be submitted six months after the calendar year end.

We want to give a bonus to our employees, can we put that on the cost proposal?

Bonuses are recouped from the overhead rate. Therefore, no, bonuses cannot be listed on the cost proposal and MnDOT will only reimburse these bonuses through the overhead rate.

Guidance