Redstone Government Consulting Blog (39)

Every month our team’s charity committee comes up with clever ideas centered around a truly important part of our organization: giving back to the community.

Previously, we discussed how a company ends up with CAS covered contracts.  This month we are going to talk about some of the further fun with CAS.  We recommended preparing a CAS Disclosure Statement soon after emerging from small business status,

FAR Subpart 2.1, Definitions, provides the meaning of two general groupings of cost not assignable directly to final cost objectives (i.e., not a direct contract cost):

For the past 10+ weeks, we have focused on how to work remotely, compensate employees who are unable to work due to COVID-19 related reasons, and how to interpret and implement the new laws applicable to the pandemic, such as the Families First Coronavirus Response Act, the Paycheck Protection Program, and CARES. As many states begin to loosen the “shelter at home/social distancing” guidelines, it is time to consider – how do we return to work safely?

Is your company in a situation, performing as a prime contractor on government contracts, but needing to sell the business? Or is there a material change in your business causing a transfer of assets to another business? In the commercial world of contracts and business operations, the assignment of contracts primarily operates under the Uniform Commercial Code (the “UCC”) and assignments occur frequently due to the ever-changing business landscape. However, this process does not exist in government contracting and novation may be the route for your organization. Assignment and novation of contracts have different consequences for the parties involved; however, for purposes of this article, we will specifically address novation within the context of contracting with the U.S. Government.

SBA Extends the Repayment Date Again – May 18, 2020

On May 13^th the Small Business Administration (SBA) updated its Frequently Asked Questioned (FAQs) – adding Questions 46 and 47.  Question 47 extends the safe harbor (repayment) date to May 18th.  Question 46 is very interesting; it lays out the SBA and Department of Treasury plan to review certifications of the necessity of the loans. 

The FAR establishes that when contracting by negotiation with the Government, the contractor should have an acceptable estimating system.  FAR 15.407-5 provides that due to the benefits to both the Government and the contractor in reducing the scope of individual proposal reviews at contractors with an acceptable estimating system, the auditor (likely DCAA) should survey the system and provide a report to all contracting offices and contract administration offices doing substantial pricing activity with the contractor.  This is a very open-ended requirement/expectation; therefore, DoD established a structure in the DFARS.

With a renewed focus on DCAA Estimating System Audits, we share some advice on successfully navigating the process.

Redstone team members take a comical look at remote working in this parody of “I Drink Alone.”