What Your SBIR/STTR Award Requires
SBIR and STTR programs are structured to fund research and development. However, these awards come with specific financial and compliance obligations.
When you accept funding, you agree to follow:
- The terms and conditions embedded in your award
- Federal cost principles and agency-specific regulations
- Requirements tied to how costs are tracked, supported and reported
In many cases, these awards function as cost-reimbursable funding, requiring detailed cost tracking and documentation. Cherry Bekaert helps you interpret these requirements so you can establish a compliant foundation from the start.
Align Your Accounting With FAR Part 31 Requirements
A central requirement for many SBIR/STTR awardees is compliance with FAR Part 31 cost principles, which govern cost allowability and recovery. To meet these standards, your accounting must:
- Track costs at the project or contract level
- Apply consistent cost treatment across your organization
- Support all costs with appropriate documentation
- Align financial records with funding terms and agency expectations
Government invoicing and reporting are typically signed under the pains and penalties of perjury. If your accounting does not align, issues may arise during funding reviews or when costs are audited. Cherry Bekaert’s federal contract and grant advisors can help you implement processes that support compliant, accurate, and defensible costs.
Build an Accounting System That Supports SBIR/STTR Funding
Your accounting system must function beyond basic financial reporting to meet strict federal cost accounting requirements. A compliant system should enable you to:
- Segregate costs as either direct, indirect or unallowable
- Track direct costs by project or funding source
- Allocate indirect costs using a consistent methodology
- Capture timekeeping and labor distribution accurately
- Reconcile project-level data with your general ledger
- Produce reports to support billing and drawdowns
Without these capabilities, it can be difficult to support costs or maintain compliance. We can help you evaluate, design and strengthen your accounting system to align with SBIR/STTR expectations.
Prepare for Oversight and Audit Before Issues Arise
Not all SBIR/STTR awardees face formal audits immediately, but that does not eliminate risk. As your funding evolves, your accounting may be reviewed:
- During follow-on funding decisions
- Against your proposal and cost structure
- As part of broader agency oversight
If your records are incomplete or inconsistent, you may face delays, questioned costs or increased scrutiny. Our federal contract and grant advisors can help you take a proactive approach by strengthening documentation, internal controls and alignment with federal requirements.
Take a More Structured Approach To Managing Your Funding
With the right accounting foundation in place, you can move beyond reactive compliance and operate more effectively, enabling you to:
- Improve accuracy and consistency in financial reporting
- Strengthen internal controls and reduce compliance risk
- Maximize allowable cost recovery
- Gain better visibility into how funding is used
- Support more informed business decisions
Cherry Bekaert helps you build a scalable, compliant approach to managing your SBIR/STTR funding so you can focus on growth rather than administrative challenges.
