Why FAR Overhead Audits Matter for Engineering Firms?

FAR audit reviews your indirect cost rate (overhead rate) ….

If your engineering firm contracts with a state DOT or other government agency, you already know that compliance can make or break your ability to win work. One of the biggest compliance hurdles is the FAR overhead audit — and for mid-sized firms, getting it right is critical.

What Is a FAR Overhead Audit?
A FAR audit reviews your indirect cost rate (overhead rate) to ensure it complies with FAR Part 31 and the AASHTO Audit Guide. DOTs rely on this audited rate to determine how much of your overhead costs are reimbursable.

Without an approved audit, your firm may be excluded from certain projects — no matter how strong your technical proposal is.

Why It Matters for Engineering Firms
- Contract Eligibility – Many DOTs will not accept unaudited rates. No audit = no contract.
- Competitive Bidding – A defensible, audited rate builds confidence with contracting agencies.
- Financial Accuracy – Audits uncover issues with timesheets, labor allocation, or expenses that could cost you money.
- Regulatory Reputation – Submitting clean, audit-ready schedules shows DOTs you take compliance seriously.

The Mid-Sized Firm Challenge
Large firms often have compliance teams. Smaller firms may not pursue DOT work at all. Mid-sized firms are in the middle — chasing bigger contracts while juggling lean resources.

That’s where the right audit partner makes the difference:
- Efficient turnaround means you don’t lose time waiting.
- Specialized expertise ensures your submission holds up to DOT scrutiny.
- Minimal disruption allows your team to stay focused on projects.

How Lopez & Javid Helps
At Lopez & Javid, FAR audits are our specialty. Each partner brings 15+ years of experience with engineering and construction clients, and our firm has a peer review rating of pass with no comments.

- Nationwide service – We work with firms across multiple states.
- Guaranteed 3-week turnaround once we have all documentation.
- Client-centered approach that reduces disruption to your operations.

From single-owner contractors to $20M+ firms, we’ve helped clients submit FAR rates with confidence.

Bottom Line
A FAR overhead audit isn’t just a compliance box to check — it’s a strategic step that strengthens your bids, protects your reputation, and opens the door to new opportunities.

If your firm is preparing for its next FAR audit, let’s talk. Lopez & Javid can deliver the accurate, timely results you need to stay competitive.