Redstone Government Consulting Blog | Accounting System Compliance

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 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)

QuickBooks is often one of the first accounting systems used by small and growing government contractors. It is accessible, familiar, and capable of supporting many core accounting needs. But the way QuickBooks is set up matters. Early decisions about accounts, projects, payroll, cost pools, and reporting may not seem significant at the time, but those choices can create problems later when the government contractor needs to support contract billing, indirect rate analysis, incurred cost preparation, or questions from a government customer or auditor.

Topics: Accounting System Compliance, Small Business Compliance, DCAA Audit Support, Quickbooks

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)

Project health depends on more than customer satisfaction and technical performance. Government contractors also need healthy margins, efficient reporting, reliable billing support, and clear contract closeout documentation. Strong alignment between the project structure and the Contract Line Item Number (CLIN) structure improves reporting, visibility into key metrics such as remaining funding, billing support, and contract closeout effectiveness. These elements help support audit readiness and more efficient project management processes.

Topics: Accounting System Compliance, Small Business Compliance, Contracts & Subcontracts Administration, Unanet, Organizational Change Management Consulting, Program Management & Project Cost Control

Reporting of Independent Research and Development (IR&D) projects on the Defense Technical Information Center (DTIC) portal is normally due no later than three months after the contractor’s fiscal year-end, both annually and upon project completion. However, the DTIC portal was offline from November 2025 until approximately April 20, 2026, due to cyber vulnerabilities. Despite the nearly six‑month outage, Defense Pricing, Contracting and Acquisition Policy (DPCAP) has provided contractors just over 30 days, until May 31, 2026, to enter all required IR&D information, including new projects, annual updates, and closed projects. This accelerated timeline contrasts with the DFARS allowance of up to three months after the fiscal year-end for reporting.

Topics: Accounting System Compliance, Incurred Cost Proposal Submission (ICP/ICE), Contracts & Subcontracts Administration, DFARS Business Systems, Defense Procurement & Acquisition Policy (DPAP), Government Regulations, Federal Acquisition Regulation (FAR)

Incurred cost submission preparation often exposes problems that never surfaced during regular monthly accounting. A contractor can have a full year of QuickBooks data, a complete set of financial statements, and detailed job cost records, and still find that the information is not organized or consistent enough to support the annual submission process cleanly.

This is not an uncommon situation, and it matters most for contractors performing cost reimbursable work. The assumption that recorded data equals ready data is a costly misunderstanding in government contractor accounting.

Topics: Accounting System Compliance, Incurred Cost Proposal Submission (ICP/ICE), Small Business Compliance, Quickbooks

Issues related to the disconnect between contracts management, project management, and accounting teams have been a topic I’ve needed to address recently with many of the customers I work with. Partially caused by disconnected systems and partially by siloed teams, issues between these teams cause significant breakdowns in maintaining an acceptable profit margin, accurate reporting for incurred cost submissions and contract close-out, and ultimately, healthy cash flow for the organization.

Topics: Accounting System Compliance, Small Business Compliance, Contracts & Subcontracts Administration, Unanet, Organizational Change Management Consulting, Program Management & Project Cost Control

On April 20, 2026, the Defense Contract Audit Agency (DCAA) announced yet another reorganization: a transition to 23 “hub” organizations while maintaining office locations at key defense contractor sites. This reduction reduces the 180 office (branch and suboffices) locations to 23 hubs covering only 19 of the 50 states in the continental U.S.

Topics: Accounting System Compliance, Small Business Compliance, Contracts & Subcontracts Administration, DCAA Audit Support, Human Resources, Government Regulations, Organizational Change Management Consulting, Manufacturing Operations Consulting