RCGI-Government Furnished Property GotchasGovernment furnished property can be a headache, even for the most seasoned contractor. It can include thousands of tiny parts, multi-million-dollar pieces of equipment or both – often all on one contract in an old dark government building. We have identified some common, and not-so-common, areas we see missing in contractor government property management plans.

Train Your Personnel

All personnel having anything to do with government property should be trained on your policies and procedures. It’s also important to make sure that your government property plan addresses all personnel involved with government property. All too often, we see plans that will only mention the 2-3 positions that are obvious to a contractor’s property plan. Sure, we know your property administrator, purchasing manager and receiving personnel are involved; what about your program managers or site coordinators?

Keep Your Policies Up-To-Date

Be specific concerning your internal audits in your policies. When are self-assessments? What sampling methods are used? What confidence level is accepted? How are findings & discrepancies handled? And keep in mind, even though the government may not formally request the results of your internal audits or self-assessments, it is still a requirement for the contractor to provide them per the FAR.

Understand “Loss” of Government Property

The FAR definition of “loss of government property” includes loss, damage, destruction and theft. In your policy or plan, make sure you are specific with your timeframe on reporting lost property. Many plans will state something to the effect of “we will immediately notify the property administrator”. The government likes specific time frames – ten minutes, thirty minutes, one hour……and so on. All time references should be specific – so they can be audited.

Remember to have a policy/procedure for finding an item that was “lost.” All data elements required to be on a property record are also required to be on a loss report. Use FAR 52.245-1 (f)(1)(iiv).

Clearly Segregate Identification and Classification

Both are plan requirements and MUST occur at the time of receipt.

  • Identification refers to the marking placed on an item to identify it as government property.
  • Classification means you should determine which of the four government property categories the item belongs in: equipment, material, special tooling, special test equipment.

Identify Subcontractor Control

Watch those flow-down clauses; It is not appropriate to flow down FAR 52.245-1 entirely. The clause applies to the government and is a guide for a prime contractor’s procedures. If your sub is following the FAR clause, as an example, it directs them to report directly to DCMA and not the prime.

Further, as a prime contractor, make sure you have a specific audit plan for any subcontractor possessing government furnished property.

Let Redstone Assist You with Your Property Control System

At Redstone Government Consulting, our objective is to ensure your company has a property control system which is transparent and accountable for all government property in your possession. Our professionals can help you design and implement a new system or update an existing one. We can help ensure your government property system provides the required controls necessary for receipt, acquisition, accountability, and management of government property.

Written by Jonas Clem

Jonas Clem Jonas is a Managing Consultant for Special Projects for Redstone Government Consulting, Inc. Jonas works with the Redstone GCI client base on a variety of issues pertaining to government cost and compliance. His specialty areas include development of compliant cost volumes and proposal pricing, as well as assisting contractors after contract award with program control, financial, cost accounting and audit issues. Jonas works on incurred cost proposals, indirect rate calculation and analysis, proposals and project control issues for Redstone. Professional Experience During his over 20‐year career in the GovCon industry Jonas has worked for both large and small contractors in a variety of roles within program finance, contracts and accounting. A substantial portion of his experience included working with a small business contractor that grew into a $100M+ large business prime contractor. In this role he served in various positions where his responsibility progressed to the Business Operations Manager for the NASA and Army Programs Division. During his career he has also worked as a Controller for a large NASA prime contractor. Jonas has twenty‐plus years’ experience in virtually every aspect of corporate business management. He has extensive proposal experience, specializing in pricing and cost volumes. He has audit experience dealing with DCAA and DCMA. He has extensive experience working with both NASA and DoD government customers in program management and program control, across all contract types. Education Jonas earned a Masters of Business Administration from Nova Southeastern University, and a BSBA in Finance from Athens State University.

About Redstone GCI

Redstone GCI is a consulting firm focused on fulfilling the needs of government contractors in all areas of compliance. With a singular mission to help contractors through the multiple layers of “red tape,” we allow contractors to focus on what they do best – support their mission with the U.S. Government. We are home to a group of consultants made up of GovCon industry professionals, CPAs, attorneys, and retired government audit and acquisition professionals.

Our focus and knowledge of audit and compliance functions administered by DCAA and DCMA will always be at the heart of what we do. However, for the past decade, we’ve strategically grown to support other areas of the government contractor back-office with that same level of focus and expertise. We’ve added expertise in contracts management, subcontract administration, proposal pricing, various software systems, HR and employment law, property administration, manufacturing, data analytics/reporting, Grant specialists, M&A, and many other areas. When we see a trend in the needs of contractors, we act to ensure we can provide the best expertise in the market to fulfill those needs.

One thing our clients can be certain of is that with the Redstone GCI Team in your corner, there is no problem too big and no issue too technical for our team to tackle.

Topics: Contracts & Subcontracts Administration, DFARS Business Systems, Government Property Management