What do indirect rates and indirect costs in Unanet mean for my organization? This is a question most of the world of government contractors ask. Managing costs isn’t just about tracking the dollars that are spent. It’s also about maintaining a profit, compliance with federal regulations and contract terms, and meeting organizational goals and standards. Unanet plays a pivotal role in navigating the complexities of government contracting, specifically, indirect rates and costs.
Topics: Accounting System Compliance, Incurred Cost Proposal Submission (ICP/ICE), Unanet
The now infamous NIH Guidance (NOT-OD-25-068) and Executive Order 14222 started us thinking. Is the Department of Defense (DoD) possibly the next domino to fall? After all, the DoD has a very large contract spend of $431.4 billion based on the Defense Spending by State, FY 2023 — Executive Summary. We looked to see if we could find data on how much of that spend is going to indirect costs (i.e., overhead). Surprisingly, the only data we could find is very dated. The data comes from the DoD Indirect-Cost Management Guide from October 2001 posted on the Defense Acquisition University (DAU) website. The guide states, “estimates made by the Defense Contract Management Command (DCMA), in conjunction with discussions with defense contractor top management on their DCMA Overhead Initiative, indicate[s] that indirect costs constitute approximately $90 billion of the $170 billion total DoD work in process at all defense contractor[s].” While not clear, our assumption is that this represents the 2000 or 2001 timeframe. Based on this, DoD is spending 53% of its appropriated funding on indirect costs. This means the average defense contractor has an approximate 100% indirect cost rate, covering overhead and general & administrative (G&A) costs. Based on recent experiences with our clients, we believe this is still a reasonable estimate of indirect cost on DoD contracts, if not a little higher.
Topics: Accounting System Compliance, Proposal Cost Volume Development & Pricing, DCAA Audit Support, Government Regulations, Cost Accounting Standards (CAS), Federal Acquisition Regulation (FAR)
Did you know that Unanet can be configured to help manage your Service Contract Act (SCA) contracts? With the correct setup, Unanet offers features that support compliance with SCA requirements—helping ensure accurate wage calculations and benefit allocations.
Here’s a quick overview of implementing SCA functionality in Unanet to make sure you’re getting it right from the start.
Topics: Accounting System Compliance, Small Business Compliance, DCAA Audit Support, Human Resources, Unanet, Government Regulations, Service Contract Act
As Kevin so aptly put it in Home Alone 2 – “Another Christmas in the trenches.”
With yet another potential Government shutdown looming, we want to draw your attention to some of our previous articles on this ever-tiring topic. Below are a few articles we’ve published on the government shutdown topic in the past:
Topics: Government Shutdown, Contracts & Subcontracts Administration
Unanet provides a comprehensive suite of features tailored to help government contractors efficiently manage people and projects. These features are designed not only to enhance cost control and profitability but also to improve overall performance while ensuring compliance with complex government regulations. At Redstone GCI, we’ve seen firsthand how proper implementation of Unanet can streamline operations, significantly reducing processing costs compared to outdated or manual systems. With its robust capabilities, Unanet is built to meet the stringent requirements of federal government timekeeping and expense reimbursement, making it a valuable tool for contractors aiming to maintain compliance and improve operational efficiency. Our team specializes in helping government contractors unlock the full potential of Unanet, ensuring it is implemented and utilized effectively to deliver maximum value.
Topics: Accounting System Compliance, DCAA Audit Support, Unanet
Topics: Accounting System Compliance, Small Business Compliance, Contracts & Subcontracts Administration, Government Compliance Training, DCAA Audit Support, Human Resources, Federal Acquisition Regulation (FAR), Organizational Change Management Consulting
With the latest point release, Unanet is improving the functionality of the roles assigned to users of the system. Hence, segregation of duties and access to information is easier for an organization to control.
Topics: Accounting System Compliance, Unanet
Unanet’s project management and general ledger budget features can be an asset when it comes time to develop provisional billing rates for the upcoming year. The information from the project budgets for the upcoming year can provide the data necessary to populate those areas of the general ledger budget so that billing rates can be calculated based on those same assumptions that project managers are using to maintain their project’s performance.
Topics: Accounting System Compliance, Small Business Compliance, DCAA Audit Support, Unanet
In August of 2023, the Defense Contract Audit Agency (DCAA) changed what is used to refer to as Mandatory Annual Audit Requirements (MAARS) 13 audits to Real-Time Audits of Purchase Existence and Consumption. This change was to eliminate the mandatory part of the requirement and introduce greater flexibility based on the auditor’s risk assessment of the contractor.
Topics: Accounting System Compliance, Small Business Compliance, Contracts & Subcontracts Administration, Government Compliance Training, DCAA Audit Support, Human Resources
In August of 2023, the Defense Contract Audit Agency (DCAA) changed what it called Mandatory Annual Audit Requirements (MAARS) 6 audits to Real-Time Audits of Labor. This change was to eliminate the mandatory part of the requirement and introduce greater flexibility based on the auditor’s risk assessment of the contractor.
Topics: Accounting System Compliance, Small Business Compliance, Contracts & Subcontracts Administration, Government Compliance Training, DCAA Audit Support, Human Resources