Simple but Effective Prime Contract Management Suggestions

Need some simple suggestions for basic contract management? This is a follow on to the previously published blog, Simple but Effective Subcontract Management Suggestions. Below are a few suggestions to consider when initiating and managing your prime contract within your contracts group.

Read More

Topics: Contracts Administration, Defense Contractors, DOD Contractors

Time to Get Your Training On

You’re probably not feeling quite like THIS about training, but we do want to remind you of a few topics that you, as a federal government contractor, need to address with your workforce on a fairly regular basis. We can’t hit them all, but this is a list of those that should be on the radar of your Human Resources staff and are relevant to most contractors.

Read More

Topics: Contracts Administration, Government Compliance Training, Human Resources, OFCCP, Affirmative Action, Drug-Free Workforce, CoBEC, EEO, Anti-Human Trafficking

Buy American – Don’t Get Caught With Your Documentation Down

What’s new in this long-standing area?

The FAR Council at long last issues final rule to implement the Trump Executive Order 13881, Maximizing Use of American-Made Goods, Products, and Materials. Only a few days later a Biden Executive Order 14005, Ensuring Future of America is Made in America by all of America’s Workers, hit the streets.

Read More

Topics: Business Systems Review, Cost and Pricing and Budgeting, Incurred Cost Submission, Small Business Compliance, Contracts Administration, Defense Contractors, DFARS Business Systems, Incurred Cost Proposals, DCAA Audit Support, FAR, Contractor Purchasing System Review (CPSR), Government Regulations, DOD Contractors

Thought There Were 52 Unallowable Costs – Not So Fast

A Little Background

FAR Part 31, Cost Principles, is the regulation that government contractors must follow in order to account for cost on most government contracts. Within FAR Part 31 is FAR 31.205, Selected Costs. This part of the cost principles regulation specifically spells out unallowable cost that the government will not pay for under a government contract. This section starts at FAR 31.205-1 and goes all the way up to FAR 31.205-52. However, it should be noted that FAR 31.205-2, 5, 9, 24, 45, and 50 are “Reserved” – These reserved cost areas went the way of the dinosaur over time, hopefully not to return. For example, FAR 31.204-2, Automatic Data Processing Equipment Leasing Costs, required an annual demonstration that leasing computer equipment was cost-effective, i.e., lowest cost to the Federal Government.

Read More

Topics: Incurred Cost Submission, Contracts Administration, Defense Contractors, Government Compliance Training, Incurred Cost Proposals, Cost-Type Contracts, DCAA Audit Support, FAR, Government Regulations, DOD Contractors

DoD Expands Treatment of Contractor Purchases as Commercial Items

Here are the Details

DoD issued DFARs Final Rule D2019-D029 – Treatment of Commingled Items Under $10K, effective October 1, 2020, to implement several sections of the National Defense Authorization Act for Fiscal Year 2017 that addresses treatment of commingled items purchased by contractors and services provided by nontraditional defense contractors as commercial items. This blog only addresses the DFARS change relative to the treatment of commingled items purchased by a contractor. The final rule is applicable to all solicitations and contracts, including solicitations and contracts using FAR Part 12 procedures for the acquisition of commercial items and solicitations and contracts valued at or below the simplified acquisition threshold.

Read More

Topics: Contracts Administration, Defense Contractors, DFARS Business Systems, DCAA Audit Support, Contractor Purchasing System Review (CPSR), DOD Contractors

DPC Clarifies Allowability of Donated Leave Related to COVID


Let us Set the Stage

On June 11, 2020, the Internal Revenue Service (IRS) put out a Notice (2020-46) that allowed employees to donate unused leave to charitable groups supporting the COVID-19 National Emergency. Under the leave-based donation program, employees can elect to forgo vacation, sick, or personal leave in exchange for cash payments that the employer makes to charitable organizations. The notice provides that employee’s donation of leave will not be taxable income to the employee, however the employer will still treat the cost of the leave granted to the employee as either ordinary and necessary business expense or a charitable contribution. This applies to donations made before the end of the 2020 calendar year.

Read More

Topics: Contracts Administration, COVID-19

FASB 842 Lease Accounting – What is the Impact on Government Cost Accounting?

The Financial Accounting Standards Board (FASB) issued Topic 842, Leases, in February 2016 effective for fiscal years beginning after December 15, 2018. The change was “to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements.” For the past 40 years or so, operating leases were only required to be presented in the disclosure and were off-balance sheet transactions. Other than the new asset (Right to Use asset) and a related liability on the balance sheet, the impact on the income statement (a single line item for lease expense) and cash flow are unchanged, at least under GAAP. International Financial Reporting Standards (IFRS) now requires all leases be treated similar to capital leases (Topic 842 calls these finance leases). So, under IFRS there will be more unallowable interest to properly account for on Government proposals and contracts incorporating FAR Part 31.

Read More

Topics: Non-US government contractor, Cost and Pricing and Budgeting, Contracts Administration, Cost-Type Contracts, Accounting & Billing System, DOD Contractors, Cost Accounting Standards (CAS)

Subcontract Considerations, Basic Tip on Compliance for Prime Contractors

If your business pipeline is growing and you are issuing more subcontracts of higher values, Contractors should be aware that your organization has a duty under 48 CFR §22.805 to the Office of Federal Contract Compliance Programs (OFCCP).

Read More

Topics: Contracts Administration, Defense Contractors, FAR, Contractor Purchasing System Review (CPSR), Government Regulations, DOD Contractors

Is Six Months Best for Incurred Cost Proposals, A New Game is Afoot

As we wrap up another hectic year of working with contractors to prepare, review and submit their Incurred Cost Proposals, it had us questioning…“Why do so many contractors wait until the last minute of their deadline to submit? Is there an advantage to submitting at the last minute or is submitting at the last minute actually a disadvantage?”

Read More

Topics: Incurred Cost Submission, Contracts Administration, Defense Contractors, Incurred Cost Proposals, Cost-Type Contracts, FAR

CARES Act Section 3610, DPC DFARS Class Deviation and Guidance

On August 17, 2020; Acting Principal Director for Defense Pricing and Contracting issued two memos providing guidance in support of DFARS Class Deviation 2020-O0013 and 2020-O0021 – CARES Act Section 3610 Implementation. There is also a memo providing contracting officers with a template for a Memorandum for Record to document the file for the issuance of the Section 3610 related contract modification.

Read More

Topics: Contracts Administration, Defense Contractors, Cost-Type Contracts, DCAA Audit Support, DPAP, Accounting & Billing System, DOD Contractors, Cost Accounting Standards (CAS), COVID-19