Government contractors deal with a unique set of rules when it comes to expenses. FAR Part 31 lays out the specific guidelines on what you can and cannot charge to the government. If unallowable costs slip through, you could face compliance problems or see expenses disallowed in an audit.
Topics: Compliant Accounting Infrastructure, Small Business Compliance, Quickbooks, Government Regulations, Federal Acquisition Regulation (FAR)
We knew this was coming based on the June 30, 2025, PF 2025-38 (FAL 2025-05) Implementation of Indirect and Fringe Benefits Cost Reimbursement Limits on Financial Assistance Awards guidance to Granting officers. However, we believed the May 15, 2025, preliminary injunction issued by the U.S. District Court for the District of Massachusetts in the case of Association of American Universities et al. v. U.S. Department of Energy would slow down DOE‘s implementation of the cap on indirect cost recovery for more than just Institutions of Higher Education (IHEs). Sadly, that is not the case.
Topics: Compliant Accounting Infrastructure, Incurred Cost Proposal Submission (ICP/ICE), DCAA Audit Support, Government Regulations, Grants & Cooperative Agreements (2 CFR 200)
The Federal Acquisition Regulatory (FAR) Council, consisting of the Office of Federal Procurement Policy (OFPP), DoD, GSA, and NASA, has finalized changes to acquisition-related thresholds in the FAR to account for inflation. Published in the Federal Register on August 27, 2025, and effective October 1, 2025, this rule (FAR Case 2024-001, FAC 2025-06) fulfills the statutory requirement under 41 U.S.C. 1908 to review and adjust thresholds every five years using the Consumer Price Index (CPI) for all urban consumers.
Topics: Contracts & Subcontracts Administration, DFARS Business Systems, Government Regulations, Federal Acquisition Regulation (FAR)
The Department of Defense (DoD) has finalized a rule that will significantly impact contractors providing management, scientific, and technical consulting services. Published in the Federal Register on August 25, 2025, and effective October 24, 2025, the rule (DFARS Case 2024-D007) implements section 812 of the FY 2024 National Defense Authorization Act (NDAA). Under the new requirement, contracting officers cannot award contracts assigned to NAICS codes beginning with 5416 if the offeror, or its subsidiaries or affiliates, holds a contract for consulting services with certain covered foreign entities, unless an approved conflict-of-interest mitigation plan is in place.
Topics: Contracts & Subcontracts Administration, DFARS Business Systems, Government Regulations, Federal Acquisition Regulation (FAR)
The Department of Defense (DoD) has finalized changes to acquisition-related thresholds in the Defense Federal Acquisition Regulation Supplement (DFARS) to reflect inflation. Published in the Federal Register on August 25, 2025, and effective October 1, 2025, this rule (DFARS Case 2024-D002) fulfills the statutory requirement under 41 U.S.C. 1908 to review and adjust thresholds every five years using the Consumer Price Index (CPI) for all urban consumers.
Topics: Contracts & Subcontracts Administration, DFARS Business Systems, Government Regulations, Federal Acquisition Regulation (FAR)
The President’s Executive Order – Restoring Common Sense to Federal Procurement involves a comprehensive overhaul of the Federal Acquisition Regulation (FAR) and subsequently the FAR Supplements. As the FAR is being updated it includes changes to contract provisions and clauses. The System for Award Management (SAM.gov), the official U.S. government website where entities register to do business with the federal government is also being streamlined.
Topics: Contracts & Subcontracts Administration, DCAA Audit Support, Contractor Purchasing System Review (CPSR), System Award Management (SAM), Government Regulations, Federal Acquisition Regulation (FAR)
Recently, we conducted research related to some incurred cost audit findings for a client and came across an Armed Services Board of Contract Appeals (ASBCA) case that highlighted key information every contractor, especially small businesses, should know. The Technology Systems, Inc. ASBCA No. 59577 reads like a soap opera. It starts with some ups and downs. There were audit findings in Fiscal Year (FY) 2001, which the contractor and the Administrative Contracting Officer (ACO) negotiated. For FY 2002 to 2006, the contractor’s indirect rates were accepted as proposed. This was followed by relationship issues during the FY 2007 audit between the Defense Contract Audit Agency (DCAA) auditor and the contractor (No surprise to most of us). Then, a period of separation occurred, from FY 2009 to 2013, when DCAA decided that proposal pricing supporting new contract awards was the priority. During this time, the contractor’s FY 2007 incurred cost audit was shelved, along with significant potential questioned costs. Then, in an act of desperation, the ACO issued a Contracting Officer’s Final Decision (COFD) based on a DCAA memorandum for the FY 2007, which questioned costs to avoid the statute of limitations running out. Ok, enough of the soap opera, let’s go through the things you need to know.
Topics: Compliant Accounting Infrastructure, Proposal Cost Volume Development & Pricing, Litigation Consulting Support, Incurred Cost Proposal Submission (ICP/ICE), DFARS Business Systems, DCAA Audit Support, Government Regulations, Federal Acquisition Regulation (FAR)
A well-configured HR system can feel like the backbone of a thriving organization by streamlining processes, enhancing employee experience, and offering powerful data insights. However, even the most advanced HR technology can quickly become a liability if one critical element is overlooked - compliance. Government contractors risk turning their greatest HR asset into a hidden source of vulnerability if they fail to consider compliance in their implementation strategy.
Topics: Small Business Compliance, Contracts & Subcontracts Administration, DCAA Audit Support, Human Resources, Government Regulations, Office of Federal Contract Compliance Programs, Service Contract Act, Organizational Change Management Consulting, UKG Ready HR Software Consulting
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Contractors are required to use provisional billing rates when invoicing costs under cost reimbursable contracts or submitting an SF1443 Contractor’s Request for Progress Payment. FAR 42.704, Billing rates, requires the contracting officer or auditor (usually DCAA) to establish the billing rates. DCAA has undergone a reorganization, and the office assigned to your contractor site may have shut down or the staff may have been relocated.
Topics: Compliant Accounting Infrastructure, Incurred Cost Proposal Submission (ICP/ICE), DFARS Business Systems, DCAA Audit Support, Government Regulations, Federal Acquisition Regulation (FAR)
This is a myth. Let’s review the commercial definition:
FAR 2.101 Commercial Product definition Paragraph 1 states:
(1) A product, other than real property, that is of a type customarily used by the general public or by nongovernmental entities for purposes other than governmental purposes, and–
(i) Has been sold, leased, or licensed to the general public; or
(ii) Has been offered for sale, lease, or license to the general public;
Topics: Contracts & Subcontracts Administration, DFARS Business Systems, Government Regulations, Federal Acquisition Regulation (FAR), Commercial Item Determination