CPAs and Advisors with Your Growth in Mind

Government Contractors

GSA Cutting Non-Compliant Vendors from Contract Schedules

With an ever-tightening budget, the General Services Administration (“GSA”) is continuously looking for cost-saving measures. Its latest means of cutting costs involves removing non-compliant vendors from the GSA schedule contracts. The most recent GSA schedule contract to be reviewed was the Information Technology (IT) Schedule, Schedule 70. In 2012, GSA announced that it would begin reviewing its procedures for granting contracts or renewing contracts for schedule holders, as well as begin moving to a demand-based model, where schedules that are oversaturated with vendors would be closed to new companies, or outdated special item numbers (SIN) would be removed. The hope. Read More.

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Landscape or “Minescape” for Potential Mergers with Government Contractors

As we work with potential acquirers of government contractors, it sometimes feels like we are holding hands and walking through a minefield. Last year’s government budget landscape was full of potential mines just waiting for us to make a wrong step and boom! Sequestration cuts, occasional insourcing of positions, government shutdown, procurements shifting to Lowest Priced Technically Acceptable solicitations, and other potential “landmines” all collided to make buyers very wary about investing their capital in the government contractor market. The mergers and acquisitions (M&A) market for government contractors has changed dramatically in the past two years, and appears to be. Read More.

DCAA Issues new Guidance on Establishment of Provisional Billing Rates

On June 27, 2014, the Defense Contract Audit Agency (“DCAA”) issued Memorandum for Regional Directors (“MRD”) 14-PPS-012(R) Guidance on Establishing Provisional Billing Rates . The new guidance is effective October 1, 2014, but early implementation is encouraged. This new guidance should help to ease issues that have arisen between DCAA and contractors regarding a contractor’s obligation to submit a proposal to establish billing rates. In the past, some of our clients have had DCAA auditors cite them for having deficient accounting systems because the contractor did not submit a “timely” proposal to establish billing rates. This was inappropriate because there is no specific requirement in the FAR for a contractor to submit. Read More.

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Proposed Rule Prohibits Award of Defense Contracts for Companies Who Violate the Fair Labor Standards Act

If your business violated the Fair Labor Standards Act (“FLSA”) within the past five years, your company may be barred from receiving new defense contracts for a period of one year. The Department of Defense Appropriations Act (H.R. 4870) for fiscal year 2015  is expected to provide funding of $491 billion for FY 2015, which is a modest one percent increase from the prior year enacted budget. Section 10030 of the act is difficult to interpret, but essentially states that any person who has violated the FLSA within five years may not receive a contract using funds available by the. Read More.

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Changes to ALL Compensation for Government Contractors

As part of the 2013 Bipartisan Budget Act, Congress reduced the contractor and subcontractor compensation cap from $952,308 to $487,000, a 49 percent reduction. The cap will be adjusted annually to reflect the change in the Employment Cost Index for all workers as calculated by the Bureau of Labor Statistics. As always, contractors can pay whatever amounts they deem appropriate, but the government will only reimburse (at the most) to the cap. Previously, Congress, in the 2012 National Defense Authorization Act, applied the ceiling on reimbursable pay to all Department of Defense (“DoD”), Coast Guard, and National Aeronautics and Space. Read More.

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New DoD Requirement to Perform its own Price Reasonableness Determination

On March 13th of this year, the Office of the Under Secretary of Defense for Acquisition Technology and Logistics issued a memorandum directing contracting officers to comply with a deviation from the Federal Acquisition Regulation (“FAR”) 8.404(d). The class deviation is applicable to Department of Defense (“DoD”) entities buying off Schedule contracts and remains in effect until the language is incorporated into the Defense Federal Acquisition Regulation Supplement. This deviation provides that “GSA has determined the prices of supplies and fixed-price services, and rates for services offered at hourly rates, to be fair and reasonable for the purpose of establishing. Read More.

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