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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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