Redstone Government Consulting Blog | Cost Accounting Standards (CAS)

DCAA’s October 6, 2026, memorandum addresses exemptions for nontraditional defense contractors from certain cost, pricing, and business system requirements. DCAA may still provide audit and advisory support, and contractors may still need to provide cost data. Questions remain about implementation and how individual exempt contracts will be reviewed.

Topics: Proposal Cost Volume Development & Pricing, Contracts & Subcontracts Administration, DFARS Business Systems, DCAA Audit Support, Government Regulations, Cost Accounting Standards (CAS), Federal Acquisition Regulation (FAR), Estimating System Compliance

Department of War’s (DoW) October 1, 2026, memorandum provides guidance on cost data requests, reporting, and profit expectations. Questions remain about how the direction will affect pricing negotiations, accounting requirements, and profit sharing. Government contractors should assess these expectations alongside existing contract terms and applicable regulations.

Topics: Proposal Cost Volume Development & Pricing, Contracts & Subcontracts Administration, DFARS Business Systems, DCAA Audit Support, Government Regulations, Cost Accounting Standards (CAS), Federal Acquisition Regulation (FAR), Material Management & Accounting System (MMAS), Estimating System Compliance, Commercial Determination

DoW is pursuing significant acquisition reforms that could reshape CAS applicability, pricing, audits, and contractor business system oversight. The planned changes emphasize greater use of GAAP, reduced administrative requirements, and streamlined acquisition practices, with implementation actions scheduled over the next 30 to 120 days and additional regulatory changes potentially required.

Topics: Proposal Cost Volume Development & Pricing, Contracts & Subcontracts Administration, DFARS Business Systems, DCAA Audit Support, Government Regulations, Cost Accounting Standards (CAS), Federal Acquisition Regulation (FAR), Estimating System Compliance, Manufacturing Operations Consulting

The CAS Board has finalized significant changes to CAS thresholds and coverage requirements effective October 1, 2026. The rule raises the basic and full coverage thresholds while introducing new considerations for IDIQ contracts, existing awards, and Disclosure Statement requirements.

Topics: Accounting System Compliance, Contracts & Subcontracts Administration, DFARS Business Systems, DCAA Audit Support, Government Regulations, Cost Accounting Standards (CAS), Estimating System Compliance

The FY 2026 NDAA raised the Truthful Cost or Pricing Data threshold to $10 million and made TINA Lite permanent for Department of War acquisitions. DCAA’s August 2026 guidance provides additional direction on proposal reviews and data expectations, making it important for government contractors to understand how these changes may affect proposal preparation and negotiations.

Topics: Proposal Cost Volume Development & Pricing, Incurred Cost Proposal Submission (ICP/ICE), Contracts & Subcontracts Administration, DCAA Audit Support, Government Regulations, Cost Accounting Standards (CAS), REAs, Claims & Terminations

Effective October 1, 2026, the CAS Board rescinds CAS 407 and transfers retained standard costing requirements to CAS 418. Greater reliance on GAAP reduces duplicative requirements, but government contractors must continue to follow consistent accounting practices and evaluate disclosure and cost impact obligations before making changes.

Topics: Accounting System Compliance, Proposal Cost Volume Development & Pricing, Incurred Cost Proposal Submission (ICP/ICE), Government Regulations, Cost Accounting Standards (CAS)

DCAA has ended planned compliance audits for CAS 404, 408, 409, and 411 following their removal from CAS effective August 7, 2026. While standalone audits for these standards are being discontinued, government contractors should expect continued scrutiny of compliance with Generally Accepted Accounting Practices (GAAP), accounting practice changes, CAS 401 compliance, and disclosure statements through other DCAA audit activity.

Topics: Accounting System Compliance, Proposal Cost Volume Development & Pricing, Incurred Cost Proposal Submission (ICP/ICE), Contracts & Subcontracts Administration, DCAA Audit Support, Government Regulations, Cost Accounting Standards (CAS), Material Management & Accounting System (MMAS)

DoD’s July 30, 2026, class deviation raises the Full CAS and Disclosure Statement thresholds to $100 million, changing how CAS coverage may apply to certain defense contracts. Government contractors should reassess CAS applicability, pending proposals, Disclosure Statement requirements, and ongoing audit activity to determine how the new thresholds affect current obligations.

Topics: Accounting System Compliance, DFARS Business Systems, Government Regulations, Cost Accounting Standards (CAS), Federal Acquisition Regulation (FAR), Estimating System Compliance

The CASB’s final rule rescinds CAS 408 and 411 and most of CAS 404 and 409 to align CAS with GAAP, effective August 7, 2026. For government contractors, the change may reduce duplicative requirements, but it does not eliminate considerations related to disclosure, consistency, or cost impact tied to accounting practice changes.

Topics: Accounting System Compliance, Contracts & Subcontracts Administration, DCAA Audit Support, Government Regulations, Cost Accounting Standards (CAS), Federal Acquisition Regulation (FAR)

The FY 2026 NDAA changed how fixed price contracts are treated in Cost Accounting Standards (CAS) cost impacts, but timing remains critical. Government contractors with CAS covered awards issued before implementation may still face current clause requirements, making award dates and clause language important compliance considerations.

Topics: Accounting System Compliance, Contracts & Subcontracts Administration, Government Regulations, Cost Accounting Standards (CAS), Federal Acquisition Regulation (FAR)