IMPORTANT UPDATE: DoD Simplifies Government Property Clauses

Last year, we wrote about the Department of Defense (DoD) proposing a change to the Defense Federal Acquisition Regulation Supplement (DFARS) that would possibly simplify Government property clauses by consolidating four clauses into a single management clause. This became a reality in December 2023 when the DoD issued a final rule consolidating the four clauses into DFARS 252.245-7005, Management and Reporting of Government Property. The new clause had an effective date of January 22, 2024.

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Topics: DFARS Business Systems, DCAA Audit Support, Government Regulations, Government Property Management, Federal Acquisition Regulation (FAR)

New DFARS Rule Attempts to Limit Flowdowns to DoD Commercial Subcontracts

Department of Defense (DoD) issued a final rule effective November 17, 2023, amending the Defense Federal Acquisition Regulation Supplement (DFARS) to limit DoD prime contractors from flowing down FAR and DFARS clauses to commercial subcontracts unless the flowdown is specified in the regulation.

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Topics: Contracts & Subcontracts Administration, DFARS Business Systems, Contractor Purchasing System Review (CPSR), Federal Acquisition Regulation (FAR)

FAR Parts and Why They Matter to Government Contractors

If you have Government contracts, you probably heard of the Federal Acquisition Regulation, or FAR, but how much do you know of its parts? Why is it important to know? How could it possibly impact me?

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Topics: Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR)

Is Construction for the Federal Government Commercial?

How does the Government define construction? We need to consider some of the definitions in FAR part 2:

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Topics: Compliant Accounting Infrastructure, Proposal Cost Volume Development & Pricing, Government Regulations, Cost Accounting Standards (CAS), Federal Acquisition Regulation (FAR), Commercial Item Determination, Federal Construction Contracting

Avoid a Hefty Tax Bill with State Sales and Use Tax Exemptions on Government Contracts

Contractors need to understand the laws for applying state sales and use taxes to purchased goods and services on government contracts. It can be a costly mistake that eats away at your profit.

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Topics: Compliant Accounting Infrastructure, Incurred Cost Proposal Submission (ICP/ICE), Small Business Compliance, Contracts & Subcontracts Administration, DFARS Business Systems, Government Regulations, Government Property Management, Federal Acquisition Regulation (FAR)

DCAA Publishes the 2024 Compensation Cap

Our friendly DCAA auditors have taken up the government requirement to calculate and publish annually the new compensation cap as provided for in Section 702 of the Bipartisan Budget Act of 2013 (BBA; Pub. L. 113-67), dated December 26, 2013. The 2024 cap amount is $646,000. Below, we have provided the compensation caps going back to 2016.

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Topics: Employee & Contractor Compensation, Incurred Cost Proposal Submission (ICP/ICE), DCAA Audit Support, Government Regulations, Federal Acquisition Regulation (FAR)

Supply Chain Requirements on Covered Articles in Effect Now

The FAR Council issued an interim rule, effective December 4, 2023, which implements the requirements of the Federal Acquisition Supply Chain Security Act (FASCSA). This included three new FAR clauses which prohibit the delivery or use of “covered articles” subject to a FASCSA order in the performance of a government contract.

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Topics: Contracts & Subcontracts Administration, DFARS Business Systems, Contractor Purchasing System Review (CPSR), Government Regulations, Federal Acquisition Regulation (FAR), Manufacturing Operations Consulting

Common Mistakes in Termination Proposals for Government Contracts

The Government can terminate its contracts, in whole or in part, through special contract clauses referred to as “termination clauses.” Terminations can be frequent occurrences and can happen for numerous reasons, such as lack of funding, bid protests, changes in military strategy, technological advancement, federal operations, or national political agendas that change the government’s needs. FAR 49.201(a) [Termination of Contracts] states, “…A settlement should compensate the contractor fairly for the work done and the preparations made for the terminated portions of the contract, including a reasonable allowance for profit….” This compensation decision, unfortunately, is made through the government’s lens. A contractor must be focused on telling their story and providing proof through adequate documentation of claimed costs.

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Topics: Contracts & Subcontracts Administration, DCAA Audit Support, Federal Acquisition Regulation (FAR)

Hold On, My Company Can Submit a Commercial Quote on a Government or Prime Solicitation?

My commercial company wants to increase business with the Federal Government – but not with all those requirements the Government follows when buying under FAR Part 15 rules (Contracting by Negotiation). Is that even possible? The answer is “absolutely”.

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Topics: Proposal Cost Volume Development & Pricing, Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR), Commercial Item Determination

What Can We Hope for with the Biden-Harris Better Contracting Initiative?

The FACT SHEET issued by the White House on November 8, 2023 professes the four underlying initiatives “will generate more than an additional 10 billion annually in savings and cost avoidance while improving the performance of Federal contracts.” Seeing as it also states, “[l]ast year alone, the Federal Government purchased $700 billion of goods and services,” – this 1.5% saving would be a good start. So, let’s take a look at these initiatives.

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Topics: Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR)