The Auditor Strikes Back: Updated Cost Allowability Guidance Published by DCAA
During late summer, the Defense Contract Audit Agency (“DCAA”) published a “Selected Areas of Cost” guidebook to replace Chapter 7 of the DCAA Contract Audit Manual (“CAM”). The newly refreshed guidebook provides further direction for auditors and contractors on how to properly treat certain types of costs listed in Federal Acquisition Regulation (“FAR”) 31.2 regarding allowability. Specifically, an unlucky 13 areas of costs have been updated with additional guidance. Those costs include: Bonus and Incentive Compensation Joint Ventures and Teaming Arrangements Depreciation Insurance IR&D/B&P Idle Facilities and Idle Capacity Legal Patents Royalties Consultants Pensions Alcoholic Beverages Manufacturing and Production Engineering. Read More.
The “How-To” for Defining Profit or Fee in DoD Price Proposals
A common question many contractors may find themselves asking: “How are we going to determine and bid profit/fee percentages to be applied in a proposal?” As always, each individual contractor has the right to determine the amount of applied profit/fee they want to bid for each contract. Dependent upon work scope, products/services offered, and even contract type, the risk is different and the competition providing proposals to the end users can vary greatly without going over statutory limitations. Contractors can utilize the Defense Federal Acquisition Regulation Supplement (“DFARS”) Weighted Guidelines approach as a tool in determining their profit negotiation position,. Read More.
Q&A: Lost in Time – The Statute of Limitation and Time Limits on Government Contracts
Approximately a year ago, we included an article in our newsletter concerning the six-year statute of limitations (“SOL”) on the assertion of claims under the Contract Disputes Act (“CDA”). This is an area of continuing confusion because it is still developing. In addition to the CDA six-year period, there are other time limits on government contractor actions in regard to government contracts. In a question-and-answer format, this blog will attempt to clarify some of the questions regarding the CDA six-year SOL and other timeliness issues. Q: Does a claim have to be for money? A: No. A claim can be. Read More.
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.
Topics: contracting officers, Cost Accounting Standards "CAS", Federal Acquisition Regulation "FAR", Federal Acquisition Regulatory Council, indefinite-delivery indefinite-quantity “IDIQ”, Subcontracting
No More “Telegraph” and “Telegram” in the FAR?
On June 6, the Federal Register included proposed rules to remove references to “telegram,” “telegraph,” and other related terminology in the Federal Acquisition Regulation (“FAR”) and replace them with electronic options for communications. These two forms of communication are outdated in our technologically driven world. A telegram is “a message sent by telegraph and then delivered in written or printed form” while a telegraph is “a system for transmitting messages from a distance along a wire, especially one creating signals by making and breaking an electrical connection.” Most, if not all of us communicate on very different platforms today. This. Read More.
New DCAA Guidance on Revised Policies Related to Low-Risk Incurred Cost Submissions
As the Defense Contract Audit Agency (“DCAA”) slowly pushes to eliminate Incurred Cost Submission (“ICS”) audit backlog, DCAA has recently published a new memorandum (“MRD”) revising guidance for selecting low-risk Incurred Cost Submission proposals less than $250 million in “auditable dollar volume” (“ADV”). Published on May 27, 2016, the memorandum revises the MRD 12-PPD-023(R), dated September 6, 2012, and MRD 13-PPD-021(R), dated October 29, 2013. While not specifically defined in the Federal Acquisition Regulation (“FAR”), Contract Audit Manual (“CAM”) or elsewhere, ADV is typically considered by DCAA to be the total contract cost for flexibly priced government contracts and subcontracts. Read More.