In 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
On 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
On 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
On 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,
The 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 CDA.
The obvious question is, when does the clock start – i.e., when does a claim “accrue”? Although the CDA does not define the term accrual, the ASBCA and Court of Federal Claims rely on the FAR 33.201 definition, which describes accrual as “the date when all events, which fix the alleged liability of either the Government or the contractor and permit the assertion of the claim, were known or should have been known.” As you may have guessed by the phrase “known or should have known,” determining when a claim accrues can raise a number of subjective and factual questions (for example, who must know? And when “should” that person have known?). Over the past several years, there have been a number of SOL decisions attempting to clarify this standard in the context of contractor and Government claims (see previous discussions here, here, here, here, here, and here).
Continue Reading Applicable Statute of Limitations for CAS Violations Comes into Focus
On May 18, 2011, the DoD released an interim Business Systems rule with request for comments. 76 Fed. Reg. 28856. Comments are due July 18, 2011. The current version of the rule reflects comments received on the prior two proposed Business Systems rules (published January 15, 2010 and December 3, 2010), requirements in the National
Due to the scrutiny and criticism DCAA received from the Government Accountability Office in 2008 and 2009, DCAA took a number of steps to address the problems identified by GAO, many of which were intended to address the finding that DCAA auditors lacked independence. The emphasis in resulting DCAA audit guidance on auditor independence has created
The Federal Circuit in its March 19, 2010 decision in ATK Thiokol, Inc. v. United States (.PDF), expanded the definition of allowable Independent Research and Development (IR&D) costs. Now, research and development costs are allowable as IR&D costs unless specifically required by the contract.
In ATK, the Federal Circuit addressed the “required in