Redstone Government Consulting Blog (19)

So, why is it that the Federal Government has a list of cost it will not pay for on Government contracts? These rules related to what costs the Government will pay for and what costs it will not pay for (i.e., unallowable costs) were developed around the Government’s belief that most companies doing business with the Government are not operating in a competitive market. As a result of the Government developing these unallowable costs, companies doing business with the Government have to take the unallowable cost they do incur out of the fixed amount of profit or fee the Government has agreed to pay these companies.

In all types of industries, organizations of any size, located in any part of the world, contracts are the lifeblood that binds their operations. These legal documents delineate the relationship between the parties, becoming the backbone of any commercial transaction, thereby maintaining the health of the organization. But merely having contracts is not enough. How these contracts are managed, specifically how they are filed and stored, plays a crucial role in a company’s overall efficiency and effectiveness. In this blog, we delve into the significance of a contract filing system and its benefits.

2 CFR 200.331, Subrecipient and contractor determinations, requires that an organization performing a grant or cooperative agreement document a case-by-case determination as to whether each sub-agreement it makes classifies the lower-tier organization in the role of a subrecipient or a contractor. The guidance provided to assist with this required determination is extremely subjective.

The Department of Defense is proposing a change to the Defense Federal Acquisition Regulation Supplement (DFARS) that would consolidate four existing Government property clauses into a single clause. The requirements of the four clauses are not going away but are being simplified to help both contractors and Government personnel in dealing with the requirements of Government property, in particular Government-Furnished property (GFP).

When contracting with the Federal Government on a cost reimbursement basis, the Government will need to ensure that your accounting system will support the complexity of this type of government contract. To achieve this, the U.S. Government has established various regulations and procedures to assess the accounting systems of prospective contractors. The main instrument is the SF1408: Pre-Award Survey of Prospective Contractor Accounting System. This article provides a comprehensive overview and explanation of the SF1408, its purpose, and its significance in the pre-award process.

Indefinite Delivery Indefinite Quantity (IDIQ) contracts often look like a big money opportunity for contractors – but looks can be deceiving. Many IDIQs are multi-awards, meaning you are just one of many contractors that may get task orders awarded under the contract. On top of that, the required minimum the Government must buy under the IDIQ is, in most cases, very low. So, it turns out that millions of dollars of anticipated business fizzles down to $2,500 – which may have a shocking impact to your return on investment.

On June 9, 2023, the Office of Management and Budget (OMB) issued M-23-16, Update to Memorandum M-22-18, providing an extension to the deadline for software developers to submit attestation forms to Federal agencies.

Comparison to FAR

Like CAS 401, CAS 402, and CAS 405, CAS 406 is part of modified CAS coverage and is one of the first CAS standards a company encounters. It likely will not call for any changes to the company’s cost accounting system if you are compliant with FAR 31.203(g)(2) (Indirect costs). FAR states that for contracts not subject to CAS:

April 25, 2023; the Court of Appeals agreed with the Armed Services Board of Contract Appeals (ASBCA) that a contractor cannot take a unilaterally established Undefinitized Contract Action (UCA) to the Board without first submitting a certified claim request for a final decision by the contracting officer.

There are many circumstances where a Unanet customer might manage multiple legal entities in the same Unanet system. There are many benefits as well: