As many of you know that work for MDOT, the deadline for Annual Financial Prequalification requirements the past few years has been 3 months after a consultants fiscal year end for those consultants submitting a FAR compliant overhead rate compilation or 5 months after a consultants fiscal year end, for those submitting a FAR compliant overhead rate audit.  MDOT has just come out with mandatory changes for the submittal of financial prequalifications.  Under the changes of the Consultant Advisory 2016-2, March 15, 2016, MDOT has changed the due dates for the submittal of required documents to the following:

  1. For the Safe Harbor and Overhead Rate Compilations, the due date is no later than 4 months following the consultant’s fiscal year end.
  2. For the submittal of a CPA FAR Compliant Overhead Rate audit or a Cognizant Review Letter, the due date is no later than 6 months following a consultant’s year end. (For calendar year end clients, that means the due date moves from May 31st to June 30th).
  3. Overhead effective dates will begin 7 months following a consultant’s fiscal year end and will be in effect for a 12 month period.

Due to these changes, MDOT will no longer grant or permit time extensions to the above stated due dates. If documents are not submitted by a consultant by the renewal date, prequalification will be suspended and a consultant will no longer be able to submit project proposals for projects requiring prequalification.

Also MDOT is requiring that all subconsultants must submit their MDOT current overhead acceptance rate letter with their first invoice to the prime consultant, as verification of overhead rate billed and again when billing with a newly accepted overhead rate. The prime consultant then must review the subconsultants billed overhead rate and verify it matches the MDOT accepted rate, prior to submitting the invoice.

For consultants submitting a cognizant agency review letter, the consultant must submit the required financial and general prequalification information, including the CPA Overhead Rate Audit, to MDOT by the due date, with the cognizant letter following, if not received by the consultant by the applicable due date.

If you should have questions regarding this information, please contact one of our experienced consultants here at Somerset CPAs, P.C.