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: Compliant Accounting Infrastructure, 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: Compliant Accounting Infrastructure, Small Business Compliance, Contracts & Subcontracts Administration, Government Compliance Training, DCAA Audit Support, Human Resources
The FAR Council issued an interim rule, effective December 4, 2023, which implements the requirements of the Federal Acquisition Supply Chain Security Act (FASCSA). This included three new FAR clauses which prohibit the delivery or use of “covered articles” subject to a FASCSA order in the performance of a government contract.
Topics: Contracts & Subcontracts Administration, DFARS Business Systems, Contractor Purchasing System Review (CPSR), Government Regulations, Federal Acquisition Regulation (FAR), Manufacturing Operations Consulting
The Government can terminate its contracts, in whole or in part, through special contract clauses referred to as “termination clauses.” Terminations can be frequent occurrences and can happen for numerous reasons, such as lack of funding, bid protests, changes in military strategy, technological advancement, federal operations, or national political agendas that change the government’s needs. FAR 49.201(a) [Termination of Contracts] states, “…A settlement should compensate the contractor fairly for the work done and the preparations made for the terminated portions of the contract, including a reasonable allowance for profit….” This compensation decision, unfortunately, is made through the government’s lens. A contractor must be focused on telling their story and providing proof through adequate documentation of claimed costs.
Topics: Contracts & Subcontracts Administration, DCAA Audit Support, Federal Acquisition Regulation (FAR), REAs, Claims & Terminations
My commercial company wants to increase business with the Federal Government – but not with all those requirements the Government follows when buying under FAR Part 15 rules (Contracting by Negotiation). Is that even possible? The answer is “absolutely”.
Topics: Proposal Cost Volume Development & Pricing, Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR), Commercial Item Determination
The FACT SHEET issued by the White House on November 8, 2023 professes the four underlying initiatives “will generate more than an additional 10 billion annually in savings and cost avoidance while improving the performance of Federal contracts.” Seeing as it also states, “[l]ast year alone, the Federal Government purchased $700 billion of goods and services,” – this 1.5% saving would be a good start. So, let’s take a look at these initiatives.
Topics: Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR)
Contractors are required to keep their System of Award Management (SAM) registration up to date. FAR 52.204-7(b)(1) requires an offeror to be registered in the System of Award Management (SAM) when submitting an offer/quote, registered until the time of award, during performance, and through final payment. Sounds pretty easy. However, contractors are not always registering or updating their registration, resulting in ineligible awards, as noted in recent court cases (See our blog: SAM Registrations: Check Often and Never Let it Lapse!).
Topics: Contracts & Subcontracts Administration, System Award Management (SAM), Government Regulations
The Defense Contract Audit Agency (DCAA) issued a memorandum to its leadership – and ultimately its auditors in the field – addressing a revision to its audit guidance related to the audit of contractor cost impact calculations for unilateral cost accounting practice changes (23-PAC-009(R) Revised Audit Guidance on the Cost Impact Calculation for a Unilateral Cost Accounting Practice Change – dated October 3, 2023). Well, it is about time.
Topics: Contracts & Subcontracts Administration, Government Regulations, Cost Accounting Standards (CAS)
If this were only a simple question. The most straightforward answer is that it is a good idea for any company to have policies and procedures. If that company is going to do business with the US Government those policies and procedures are going to have to be expanded as each contract may present additional requirements. To help you understand the complex level of requirements we will address the major business systems and other key areas.
Topics: Compliant Accounting Infrastructure, Contracts & Subcontracts Administration, DFARS Business Systems, Human Resources, Contractor Purchasing System Review (CPSR), Government Regulations, Government Property Management, Federal Acquisition Regulation (FAR), Material Management & Accounting System (MMAS), Estimating System Compliance
Well – besides being the first thing your friendly DCAA auditor will ask you for, they should be something your employees use and rely on daily. The last thing you want is one of your employees telling an auditor they have never seen or read the company’s policies and procedures. The joy that will come across the auditor’s face will be truly shocking – and – the sadness that will come across your face when the Business System Deficiency Reports start to arrive, requiring endless responses and corrective action plans, will be just as shocking. This fairytale has no happy ending, at least not for you and your company – just a drain on your resources and more audit oversight.
Topics: Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR)