AASHTO (American Association of State Highway and Transportation Officials) has recently updated its National Compensation Matrix and it is now available on the AASHTO website. As expected, the NCM team applied an escalation factor to the underlying survey data used to develop the 2012 NCM. What you will see is an overall increase in the NCM results, but no dramatic changes.
State DOTs must obtain reasonable assurance that executive compensation costs claimed by engineering consultants are reasonable and otherwise allowable. To promote consistency in this process, a group was formed to prepare a National Compensation Matrix (NCM) for use in determining reasonable levels of executive compensation for engineering consultants in compliance with the criteria established in Section 7.5 of the AASHTO Uniform Audit & Accounting Guide.
The NCM was developed by the NCM Team, which included representatives from AASHTO, various State DOTs, the FHWA, ACEC, and independent CPAs. Additionally, an independent Certified Compensation Professional (CCP) provided input and guidance to the Team throughout the project.
Please note that PennDOT has released a statement that they are NOT accepting the NCM as a determination for reasonable compensation and they are still relying on the ERI Compensation studies.
If you have any questions or comments about this topic, please don't hesitate to reach out to David Shaffer, Director, Audit & Accounting, at Email or 215-441-4600, or Craig Evans, Director Audit & Accounting at Email or 215-441-4600.
Information contained in this alert should not be construed as the rendering of specific accounting, tax, or other advice. Material may become outdated and anyone using this should research and update to ensure accuracy. In no event will the publisher be liable for any damages, direct, indirect, or consequential, claimed to result from use of the material contained in this alert. Readers are encouraged to consult with their advisors before making any decisions.