By Nicole Owren-Wiest, Steve McBrady, Elizabeth Buehler and Charles Baek on Posted in Cost/Cost Accounting,Legal DevelopmentsThe Defense Contract Audit Agency (“DCAA”) recently made public its Fiscal Year 2017 Report to Congress, which, among other things, provides an update on incurred cost audits. Specifically, the report explains that DCAA: Closed “6,786 incurred cost years” using a variety of methods, namely reports and memos, but also for other reasons (e.g., per the… Continue Reading
By Nicole Owren-Wiest, Elizabeth Buehler, Sharmistha Das and Charles Baek on Posted in Cost/Cost Accounting,Legal DevelopmentsContractors looking for updates to the statutory allowable cost limits on employee compensation may be looking in the wrong place. But what was once lost can easily be found, at least for the moment, by simply navigating to a different website. The Cost Principles and the Compensation Cap FAR 31.205-6(p)(4) governs the allowable compensation of… Continue Reading
By Crowell & Moring on Posted in Bid Protest,Claims,Cost/Cost Accounting,Cybersecurity,Suspension & DebarmentCrowell & Moring is hosting Government Contracts 101 in our Washington, D.C., office on Thursday, October 26, 2017. This all-day event will last from 8:30 a.m. to 6:30 p.m. at 1001 Pennsylvania Ave, N.W., and provide an overview of the full scope of issues that government contractors face on a daily basis. We will cover FAR,… Continue Reading
By Steve McBrady and Daniel Wierzba on Posted in Claims,Cost/Cost AccountingContractors that use a fiscal year ending 12/31 submit their annual cost submissions in June of the following year. For 2010 incurred cost submissions (ICS) submitted in June 2011, many contractors may receive affirmative claims from the Government seeking to disallow some or all of those incurred costs, because the Government has a 6-year statute… Continue Reading
By Crowell & Moring on Posted in Cost/Cost Accounting,Cybersecurity,International Contracting/FCPA,Legal DevelopmentsWe’ve wrapped up our preview posts, which gave a sneak peek at just a few of tomorrow and Friday’s OOPS panels, including investigations, privacy and cybersecurity, international procurement, and cost and pricing issues. It’s not too late to register for the event! Click here for details and directions. We’ll see you tomorrow at the Renaissance Hotel… Continue Reading
By Elizabeth Buehler on Posted in Cost/Cost Accounting,Legal DevelopmentsDuring the past year, we have continued to see developments on cost and pricing issues, particularly with respect to the 2017 National Defense Authorization Act (“NDAA”). On May 5, 2017 from 11:00 am – 12:00 pm, Crowell & Moring attorneys Terry Albertson, David Bodenheimer, Chris Haile, Steve McBrady and Liz Buehler will highlight some of the… Continue Reading
By Crowell & Moring on Posted in Cost/Cost Accounting,Cybersecurity,International Contracting/FCPA,Legal DevelopmentsThe Government Contracts Group is counting down to Crowell & Moring’s 33rd annual Ounce of Prevention Seminar (OOPS), which will be held on May 4 and 5 at the Renaissance Hotel in Washington. This year’s seminar, “Strategizing for Government Contractors’ Game Plan Under the New Administration,” will provide insider insight and practical advice across a… Continue Reading
By Steve McBrady, Terry L. Albertson, Skye Mathieson and Elizabeth Buehler on Posted in Cost/Cost AccountingIn Lockheed Martin Integrated Systems, Inc. (ASBCA Dec. 20, 2016), a case involving a $100 million breach of contract claim stemming from purportedly unallowable direct subcontractor costs, the Board granted Lockheed Martin’s motion to dismiss the Army’s untenable claim “for failure to state a claim on which relief could be granted,” concluding that the government… Continue Reading
By Crowell & Moring on Posted in Cost/Cost Accounting,Cybersecurity,Events,Labor & EmploymentWe’ve wrapped up our preview posts, which gave a sneak peek at a few of tomorrow and Thursday’s OOPS panels including cybersecurity (OOPS Preview: Regulating Information: Cybersecurity, Internet of Things, and Exploding Rules), costs & accounting OOPS Preview: Cost & Accounting: Items at the Top of the Ledger) , and labor and employment (OOPS Preview:… Continue Reading
By Steve McBrady on Posted in Cost/Cost Accounting,EventsThe past twelve months have seen major developments on cost and pricing issues relevant to the “top of the ledger” – as well as the bottom line. On May 26, 2016, at 11:00 am -12:00 pm, Crowell & Moring attorneys Terry Albertson, Steve McBrady, Rob Burton, and Skye Mathieson will highlight some of the most… Continue Reading
By Steve McBrady, Skye Mathieson and Charles Baek on Posted in Claims,Cost/Cost AccountingIn AeroVironment, Inc. (Mar. 30, 2016), following an apparent settlement of the government’s cost disallowance claim, the ASBCA denied the government’s request to amend its answer (in order to “clarify” entitlement to additional quantum) because the proposed amendments constituted new “claims” that required new final decisions. Acknowledging that parties may ordinarily revise quantum without running… Continue Reading
By Steve McBrady and Mark Ries on Posted in Cost/Cost AccountingOn April 15, 2016, the Acting Secretary of the Army issued Army Directive 2016-16 (Changing Management Behavior: Every Dollar Counts) stating that the Army will “eliminate ‘use or lose’ funding practices,” i.e., “commanders and staffs will not automatically decrement commands or programs in future allotments when they do not spend all funds without further investigation… Continue Reading
By Steve McBrady, Terry L. Albertson, Gail D. Zirkelbach and Skye Mathieson on Posted in Cost/Cost AccountingOn February 17, the Federal Register published a proposed rule that would amend the FAR to implement section 857 of the National Defense Authorization Act, making unallowable any “costs incurred by a contractor in connection with a Congressional investigation or inquiry into an issue that is the subject of a proceeding resulting in a disposition… Continue Reading
By Steve McBrady and Terry L. Albertson on Posted in Cost/Cost AccountingIn a notice published in the Federal Register on February 8 that will almost certainly be unpopular with contractors and their customers, DoD asked for comments on its consideration of adding a requirement to the DFARS that would “require offerors to describe in detail the nature and value of prospective IR&D projects on which the… Continue Reading
By Steve McBrady, Terry L. Albertson and Skye Mathieson on Posted in Cost/Cost AccountingThe 2016 National Defense Authorization Act prohibits the Defense Contract Audit Agency from providing “audit support” to any non-DOD agency until the Secretary of Defense certifies that DCAA has reduced its backlog of incurred cost audits to 18 months or less, a restriction that could cause some disruption for contractors when DOD contracts are not… Continue Reading
By Steve McBrady, Terry L. Albertson and Skye Mathieson on Posted in Cost/Cost AccountingOn October 1, the DoD IG released a report titled “Evaluation of Defense Contract Management Agency Actions on Reported DoD Contractor Business System Deficiencies,” asserting that DCMA contracting officers “repeatedly” failed to comply with DFARS requirements involving reported business system deficiencies. The report, which is similar to a report issued on June 29, 2015 regarding DCMA’s… Continue Reading
By Terry L. Albertson and Steve McBrady on Posted in Cost/Cost AccountingWhile DOD’s August 26 white paper “Enhancing the Effectiveness of Independent Research and Development” explains that the intent of new requirements announced in the white paper is “not to reduce the independence of IR&D investment selection, nor to establish a bureaucratic requirement for government approval prior to initiating an IR&D project,” contactors have good reason to doubt… Continue Reading
By Terry L. Albertson, Steve McBrady and Skye Mathieson on Posted in Cost/Cost AccountingIn Raytheon Co., ASBCA Nos. 57801 et al. (May 7, 2015), the Board held that under FAR 30.606 contractors may not offset cost impacts from simultaneous accounting changes within the same business segment, which if not reversed on appeal will cause major disruptions when contractors make multiple changes in cost accounting practices made after 2005 (the date of the FAR change),… Continue Reading
By Terry L. Albertson, Steve McBrady and Skye Mathieson on Posted in Cost/Cost AccountingOn January 7, 2015, DCAA issued guidance to auditors for determining whether certain costs are “expressly unallowable” – and therefore subject to penalties – even when the regulations “do not state in direct terms that the cost is unallowable.” This guidance, which is intended to “enhance” the equally troubling December 18 guidance to similar effect,… Continue Reading
By J. Catherine Kunz on Posted in Cost/Cost AccountingOn Wednesday, July 23rd from 11:30 am -1:30 pm, Cathy Kunz will join Rubino & Company to discuss critical issues in cost law. As contractors face more scrutiny and review of their cost and accounting practices, we will address recent cost-related court decisions and legal changes including the new caps on executive compensation, application of… Continue Reading
By J. Catherine Kunz on Posted in Cost/Cost AccountingOn April 2nd, Cathy Kunz joins Paul Calabrese of Rubino & Company for an important roundtable for government contractors. During this ½ day presentation sponsored by Bank of America and Merrill Lynch, participants will get both the legal and accounting perspective. From the legal side, Cathy will review recent cost-related court decisions and legal changes,… Continue Reading
By Steve McBrady on Posted in Cost/Cost AccountingThe Contract Disputes Act, 41 U.S.C. §§ 7101-7109, sets forth certain prerequisites for the exercise of jurisdiction over claims. Among these prerequisites is a six-year statute of limitations, which is applicable to Government and contractor claims alike. With few exceptions, claims submitted more than six years after “accrual” are not valid and cognizable under the… Continue Reading
