Key Concerns for Government Contractors
Thursday, August 12th, 2010
The environment in which government contractors have to work within has changed significantly over the last couple of years and the trend looks to continuing. The changes have created uncertainty in the industry and concerns as to potential increased risk to contractors. The attached PowerPoint documents address these changes and their impact to the industry. Subjects covered include:
- Life under the new DCAA attitude
- Allowability of Specific Costs
- Adequate and Timely Incurred Cost Proposals
- Business Ethics & Conduct and Mandatory Disclosure
- Proposed DFARS Rule: Withholding Payments to DoD contractors
- Prime Contractor Management of Subcontractors
- Organizational Conflict of Interest – DFARS update, Requirements and problems
- Reporting Subcontract Awards Greater than $25,000
- American Recovery and Reinvestment Act
FAR Subpart 4.15 – Reporting Requirements - DoD Finalizes Changes to DFARS on Export Control
- Labor Relations Cost – Cost to fight unionization unallowable
Proposed DFARS Rule: Withholding Payments to DoD to Contractors
Wednesday, February 10th, 2010
This proposed rule follows on the heal of an earlier article in which it was discussed how DCAA is becoming less likely to approve a Contractor’s various Systems from accounting to material management.
This proposed rule will more likely than not become a final rule after comments are received.
Contractors will need to work very hard to ensure their Systems are compliant not only to FAR and CAS but also to DCAA audit standards
Click here for a copy of the article
News Alert – Letter Contracts and Risk involved
Tuesday, January 26th, 2010
During the past year contractors have experienced an increase in the number of letter contracts both from the Government and Prime contractors. Unsuspecting contractors and subcontractors accept “firm fixed price” letter contracts with a price to be negotiated and/or a Not to Exceed price. After the letter contract is signed, the government or the Prime delays definitizing the contract until most or all costs are incurred and then prices the contract at the lower of actual cost or the NTE. And because the costs are known at this point, the risk and profit are lower than what would have otherwise been allowed. Much of the delay is now due to DCAA rejecting proposals as not adequate as a basis for negotiations. The new DCAA initiative to disapprove everything has revived the DCAA estimating concept that budgets and estimates cannot be trusted and the best (maybe only) way to estimate costs is to use history. The only sure cure is to ”Just Say No To Letter Contracts”
