CPAs and Advisors with Your Growth in Mind

Get Ready: The Truth in Negotiations Act Threshold is about to Jump to $2 Million!

As discussed in the blog on January 17, 2018 , Section 811 of the 2018 National Defense Authorization Act will increase the Truth in Negotiations Act (“TINA”) threshold from $750,000 to $2 million effective as of July 1, 2018. This is great news for government contractors as now they are not required to submit and certify cost and pricing data on awards under this amount. If a Contracting Officer requests cost and pricing data to support proposals under the new threshold, the data provided will not be certified. In turn, it reduces the risk of any defective pricing for the contractor. This increase directly impacts. Read More.

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DCAA 2018 Hot Button Highlights

By: Curt Smith , Manager Each year Cherry Bekaert addresses topics that effect the Defense Contract Audit Agency (“DCAA”) in our DCAA “Hot Buttons” webinar. A summary of the January 17, 2018, webinar is presented here. The webinar is replay is also available on our YouTube channel. The webinar is available for replay on our YouTube channel. Section 803 of the 2018 National Defense Authorization Act (“NDAA”) Section 803 of the 2018 NDAA contains several provisions reforming defense contract auditing. Perhaps the provision with the greatest impact on DCAA directs the Department of Defense (“DoD”) to begin using private auditors to perform incurred cost audits to reduce the current backlog. The provision intends to focus DCAA resources on forward-pricing audits, which are considered. Read More.

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ASBCA Holds that Leases are not Necessarily Subject to CAS 404

In Exelis, Inc., ASBCA No. 60131 (29 Aug. 2016), the Armed Services Board of Contract Appeals (“ASBCA”) held that a concern whether a building lease was a capital lease or an operating lease is not subject to Cost Accounting Standards (“CAS”) 404. In 2007, the Defense Contract Audit Agency (“DCAA”) released its audit of Exelis’ 2004 final indirect cost rates. DCAA questioned Exelis’ lease costs, finding that the building lease was a capital lease instead of an operating lease as claimed by Exelis and that Exelis could only include building depreciation in its indirect cost pool rather than the entire. Read More.

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The ASBCA Issues Two CAS Decisions

By: John Ford , Senior Consultant, Government Contractor Services Group Recently, the Armed Services Board of Contract Appeals (“ASBCA” or “the Board”) issued two decisions relating to the Cost Accounting Standards (“CAS”) that should be of interest to contractors. In the first decision, Raytheon Company, Space and Airborne Systems, ASBCA No. 58608 (August 19, 2016), the Board decided that the contracting officer had abused her discretion by failing to consider all the factors listed in Federal Acquisition Regulation (“FAR”) 9903.305 in determining whether increased costs to the government resulting from an accounting practice change were material. As a large contractor doing billions. Read More.

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DoD Proposes Changes to Cost or Pricing Data Rules for Small Businesses

On August 30, the Department of Defense (“DoD”) issued a proposed rule to implement a section of the National Defense Authorization Act for fiscal year 2016 that provides exceptions from the certified cost and pricing data requirements, and from the records examination requirement for certain awards to small businesses or nontraditional defense contractors. The proposed rule would amend the Defense Federal Acquisition Regulation Supplement (“DFARS”) to provide an exception from cost or pricing data for contracts, subcontracts, or modifications of contracts or subcontracts valued at less than $7.5 million. This exception would be applicable to small businesses or “nontraditional” defense contractors,. Read More.

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Improvements to Subcontracting

On July 14, 2016, the Federal Acquisition Regulatory Council published a final rule in Federal Acquisition Circular 2005-89, effective November 16, 2016, intended to improve subcontracting with small business concerns. The new rule implements sections 1321 and 1322 of the Small Business Jobs Act of 2010. Under section 1321, the Federal Acquisition Regulation (“FAR”) was to be amended “to establish a policy on, subcontracting compliance relating to small business concerns.” Thus, the new rule makes many FAR provisions relating to subcontracting with small business concerns. We will not discuss all the changes here, but will highlight those that have a. Read More.

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