Category Archives: Government Contracts

approved-stamp (3)

Can you look at your company’s costs and tell which costs are direct or indirect? If you can’t, understanding the difference between direct and indirect costs is a critical first step in your plan to get a compliant and approved cost accounting system for Government Contracting. As I mentioned in my previous blog post “What you should know about having an ‘approved’ accounting system for government contracting”,  a compliant government cost accounting system must: Track all costs for any individual government contract Accumulate actual direct costs by labor category and job/task Accumulate actual indirect costs and … We need to track all the costs for each individual government contract. To do this, I use a General Ledger and a Subsidiary Job Cost Ledger that I manually link to the General Ledger. I record all our company’s costs in the General Ledger and track all the costs for each individual contract … Continue reading

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approved-stamp (3)

Do you wonder about what is necessary for a small business to have an accounting system suitable for government work? We were faced with that question when we needed to set up our accounting system to allow us to work on government contracts. I had a head start because I had been a Government auditor for 10 years, but I faced new challenges when I had to set up my own accounting system versus working with accounting systems that were already in place. I want to share what I have learned and give you some resources for learning more about accounting for government contracts. First of all, the basics…a compliant government cost accounting system must: • Track all costs for any individual government contract • Accumulate actual direct costs by labor category and job/task • Accumulate actual indirect costs and allocate these costs using provisional, budgeted, or actual burden rates • … Continue reading

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archived-files

Have you been notified that the Defense Contract Audit Agency auditor or other contract auditor will be knocking on your door one of these days, asking some hard questions about your government contract and wanting to see your records? If you follow some simple guidelines, you can feel confident that you will have the records that the auditor will request. As a former Defense Contract Audit Agency auditor, I sat on the other side of the table asking hard questions and asking for the records to back up the contractor’s answers. DCAA and auditors for other contracting agencies perform all needed contract audits through evaluation of contractor records. Often I was not asking for records readily on hand for this year, but for records from past years. Now I sit across from the auditor who is asking those questions and wanting our records. But how long must a company keep … Continue reading

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