DCAA IDENTIFIES AND ESTABLISHES AUDIT PRIORITIES FOR ALL ACTIVITIES THAT DIRECTLY OR INDIRECTLY AFFECT PROPOSED OR INCURRED COSTS OF GOVERNMENT CONTRACTS. THIS APPROACH, TERMED TOTAL AUDIT CONCEPT TECHNIQUE, PROVIDES AN APPROPRIATE BALANCE BETWEEN COMPLIANCE AND OPERATIONS AUDITS. THE ESTABLISHMENT OF AUDIT PRIORITIES IS A CRITICAL FIRST STEP IN DECIDING WHERE TO USE AVAILABLE AUDIT TIME. TO DETERMINE WHICH WORK PACKAGES SHOULD RECEIVE THE HIGHEST PRIORITY, A FORMAL SYSTEM HAS BEEN DEVELOPED FOR RANKING AUDIT WORK PACKAGES ON THE BASIS OF RETURN FOR AUDITOR HOURS INVESTED. THE KEY STEPS IN THIS FORMAL PROCEDURE, CALLED WORKPACKAGE RISK ANALYSIS PROCEDURE (WRAP), ARE DESCRIBED. ALSO DISCUSSED ARE TECHNIQUES AND APPROACHES USED BY DCAA IN CONDUCTING AUDITS OF OFFICE EQUIPMENT REPAIR COSTS; ENERGY COSTS; A CONTRACTOR'S REPRODUCTION EQUIPMENT, FACILITIES, AND RELATED OPERATIONS; AND A CONTRACTOR'S AUTOMATIC DATA PROCESSING FUNCTION WHERE ALL COMPUTER SERVICES ARE SUPPLIED BY A SEPARATE, WHOLLY OWNED SUBSIDIARY OF THE PARENT COMPANY. TABLES ARE INCLUDED (PRG)