--- title: "The Incurred Cost Submission: Why are Schedules H and J Important?" description: What are Schedules H and J in the Incurred Cost Submission? Why are they important? image: https://info.redstonegci.com/hubfs/RGCI%20-%20The%20Incurred%20Cost%20Submission%20Why%20are%20Schedules%20H%20and%20J%20Important.png --- [ PAY INVOICE](https://redstonegci.com/invoice-payment/) [Call Us Today 256-704-9800](tel:2567049800) [info@redstonegci.com](Mailto:info@redstonegci.com) [![Redstone_Logo](https://info.redstonegci.com/hubfs/redstone%20logo%20version%201%20-%20rgb-1.png)](https://www.redstonegci.com/) # The Incurred Cost Submission: Why are Schedules H and J Important? [Posted by Redstone Team on Mon, Jan 30, 2023 @ 09:01 AM](https://info.redstonegci.com/blog/author/redstone-team) - [Tweet](https://twitter.com/share) Schedules H and J are some of the most important parts of the Incurred Cost Submission. This VLOG will briefly explain the Incurred Cost Submission, how to complete Schedules H and J, and the importance of each schedule. ## What is the Incurred Cost Submission (ICS)? The incurred cost submission goes by many names/acronyms including final [indirect rate proposal, incurred cost electronic submission, indirect cost rate submission, incurred cost proposal, ICES, ICS or ICP](https://redstonegci.com/consulting/government-compliance/incurred-cost-proposals/). Regardless of name, it is simply the mechanism for the true up of your actual indirect cost to the indirect costs provisionally billed for in a single contractor fiscal year. An ICS must be submitted for each business unit of a contractor that holds applicable contracts subject to the [Allowable Cost and Payment clause (FAR 52.216-7)](https://www.acquisition.gov/far/52.216-7) and is required to be submitted 6-months after fiscal year end. ## What are Schedules H and J in the ICS? Within the Incurred Cost Submission, there are many worksheets or tabs in an Excel workbook that are referred to as “schedules”. Previously, we discussed the importance of [Schedules B through Fringe](https://info.redstonegci.com/blog/why-are-schedules-b-c-d-and-fringe-important-final), [Schedule I](https://info.redstonegci.com/blog/what-is-schedule-i-in-the-incurred-cost-submission) and [Schedule K](https://info.redstonegci.com/blog/the-importance-of-schedule-k-in-the-incurred-cost-submission). Schedule H is the summary of direct and indirect cost by contract and contract type. Additionally, [Schedule J in the ICS is subcontractor information](https://redstonegci.com/consulting/operational-support-services/contracts-administration/) for flexibly priced projects with subcontract costs. ## Why are Schedules H and J Important? Schedule H is important because it is the place in the Incurred Cost Submission that shows the direct project costs by project type, as well as the absorption of all indirect costs by project. Schedule J is important because it is the place in the Incurred Cost Submission that identifies the subcontracts a contractor has awarded to companies for which the contractor is the prime or upper-tier contractor, including inter-divisional efforts. ## How is Schedule H Completed? The first step to completing Schedule H is to gather all projects for the fiscal year and enter in the contract information into Schedule H, organized by contract type. DCAA’s ICE model has sections on Schedule H for Cost Type, Time and Material, Other Flexibly Priced, Fixed Price, and Commercial type contracts, which can be expanded to include as many contracts as necessary. After organizing the projects by contract type, it’s time to begin entering in the direct costs for each project. The first step is to enter in the direct labor costs then the next step is to enter in the non-labor direct costs by project. Generally, the non-labor direct costs are grouped into 4 categories: Travel, Materials, Other Direct Costs, and Subcontracts. The total direct cost categories on Schedule H, meaning labor and non-labor categories, should reconcile to your accounting books of record. After the total direct costs by project have been entered in, DCAA’s ICE model should automatically calculate the claimed indirect costs by project. On Schedule H, these will be located in the columns to the right of the direct costs and in gray or blue colored cells. ## How is Schedule J Completed? Schedule J is one of the more straight-forward schedules within the ICS. Schedule J lists the information for each subcontract that is issued under any flexibly priced contract on Schedule H. Schedule J lists the following information by subcontract type: subcontract number, prime contract number, prime contract value, subcontractors name and address, subcontractor’s unique entity ID, point of contact and phone number, subcontract value, subcontract period of performance, subcontract amount incurred in the ICS fiscal year, and the subcontract award type. Schedules H and J in the Incurred Cost Submission are two of the important schedules in the ICS. These schedules create the total costs by contract and display the subcontract information for each flexibly priced contract with subcontract costs. Redstone GCI is available to [assist contractors in assessing their incurred cost as adequate or inadequate](https://redstonegci.com/consulting/government-compliance/incurred-cost-proposals/) as well as assist in the development of the proposal. Redstone GCI assists contractors throughout the U.S. and internationally with understanding the Government’s expectations in [applying FAR Part 31 Cost Principles and completing incurred cost proposal requirements](https://www.acquisition.gov/far/part-31). 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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. 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