Cherry Bekaert: Government Contractors Guidance

In this episode of Cherry Bekaert’s GovCon Podcast series on the Small Business Administration’s (SBA) 8(a) Business Development Program, Brynn McNeil and Craig Hunter, assurance partners in Cherry Bekaert’s Government Contracting Industry practice, discuss accounting best practices for 8(a) companies. Listen to find out about:

• Setting up an accounting system to segregate costs
  • Chart of Accounts
  • Indirect rates
• Reporting functionality for:
  • Contract revenue summary by contract
  • Showing cumulative revenue
  • Annual revenue
  • Direct costs
• Importance of month end reconciliations of balance sheet account 
• Recent accounting pronouncements that impact accounting 
  • ASC 505
  • ASC 842
• What to consider when selecting an accounting system 
• Accounting department general housekeeping best practices

Cherry Bekaert’s team of government contracting consultants have extensive experience in navigating the SBA 8(a) Business Development Program and can assist your business with accounting best practices. If you have any questions specific to your situation, our GovCon consultants are available to discuss your situation with you. Contact us.

If you haven’t already, catch up on other episodes in our podcast series discussing various aspects of the Small Business Administration’s (SBA) 8(a) Business Development Program:

• The SBA 8(a) Business Development Program – What Is It and What Are the Requirements?
• The SBA 8(a) Business Development Program Application Process and Requirements
• What Are the Compliance Requirements for 8(a) Certified Companies?
• Winning an SBA 8(a) Sole Source Award Contract – What’s Involved and What to Know
• Winning an 8(a) Competitive Contract
• Small Business Administration (SBA) Mentor-Protégé Program
• SBA Mentor-Protégé & Joint Venture Arrangements – Important Elements of the Agreement
• The lifecycle of an 8(a) Company
• OIG Report: SBA’s Business Development Assistance to 8(a) Program Participants
• Contract Performance After the SBA 8(a) Business Development Program

View all Government Contracting Podcasts

In the first episode of a new series on effective operational and financial performance for government contractors, Eric Poppe, a Managing Director in Cherry Bekaert’s Government Contracting Industry practice, is joined by Todd Angioli, a Director in the Firm’s GovCon practice with 20+ years of financial operations experience, to discuss considerations when budgeting for year end. Listen to this episode to find out more about:

• What government contractors should consider during year end and while budgeting for the next calendar year
• High-level considerations when reviewing the operating plan:
  • Revenue
  • Direct Labor
  • Fringe
  • Overhead
  • General and Administrative Expenses (G&A)
  • Bottom Line 
• Key budget planning areas:
  • Recompete/New Business
  • Resources
• What growing government contractors should be doing at year end

Cherry Bekaert’s team of government contracting consultants have significant operations and finance experience. If you have any questions specific to your situation, our GovCon consultants are available to discuss your situation with you. Contact us.

View all Government Contracting Podcasts

In the second episode of Cherry Bekaert’s Cost Accounting Standards (CAS) podcast series, Eric Poppe, a Managing Director in Cherry Bekaert’s Government Contracting Industry practice, is joined by Jeff Annessa, a Senior Manager in the Firm’s GovCon practice who spent 13+ years with DCAA and held various positions such as Quality Manager, Supervisory Auditor, Field Audit Office Manager, and Artan Ivezaj, a manager in Cherry Bekaert’s GovCon practice with 15 years of experience at the DCAA, to discuss CAS considerations for a growing GovCon. Listen to this the episode to find out more about:

• When a company should start thinking about CAS
• The difference between full and modified CAS coverage
• Explanation of the fundamental requirements of CAS 401 and 402
  • CAS 401: Consistency in Estimating, Accumulating, and Reporting Costs
  • CAS 402: Consistency in Allocating Costs Incurred for the Same Purpose
• The commonality of Federal Acquisition Regulation (FAR) Cost Principles, Approved Accounting System, and CAS
• Being aware of CAS 405 and 406
  • CAS 405: Approved accounting system requires the system to ensure unallowable costs are reviewed and removed from government billings
  • CAS 406: Cost Accounting Period
• Important notes about CAS Coverage and the applicability towards subcontracts
• Disclosure Agreement as it pertains to CAS

Cherry Bekaert’s team of government contracting consultants have significant CAS experience and can help your growing government contracting business navigate CAS. If you have any questions specific to your situation, our GovCon consultants are available to discuss your situation with you. Contact us.

If you haven’t already, catch up on Part 1 of the series:

• Cost Accounting Systems Series: Part 1 – An Overview

Related Guidance

• Webinar Recording: Cost Accounting Standards (CAS): Part 1 – CAS Coverage Types, Common Standards, and CAS Applicability
• Webinar Recording: Cost Accounting Standards (CAS): Part 2 – Cost Accounting Changes and Impact

View all Government Contracting Podcasts

Cost Accounting Standards (CAS) are 19 standards and rules promulgated by 41 U.S.C. 422. These standards impact emerging small and large businesses alike. They are designed to achieve uniformity and consistency in cost accounting practices and to improve the accuracy of cost data by ensuring its basis on consistent definitions and principles.  

Ultimately, the Federal government wants a reliable basis for cost comparison and decision making. This allows them to be able to compare proposals from contractor to contractor and from a single contractor year-over-year.

In this new Cherry Bekaert GovCon Podcast CAS series, Eric Poppe, a Managing Director in Cherry Bekaert’s Government Contracting Industry practice, is joined by Jeff Annessa, a Senior Manager in the Firm’s GovCon practice who spent 13+ years with DCAA holding positions such as Quality Manager, Supervisory Auditor and Field Audit Office Manager, to give an overview of CAS. Listen to find out:

• An overview of CAS
• The differences between the Federal Acquisition Regulation (FAR) and CAS
• What the standards consist of, including the four main categories 
• When CAS comes into consideration as it pertains to government contracting
• When CAS would apply to a contract and if there are certain dollar thresholds
• The current exemptions, differences in full and modified CAS coverage and application
• Overview of the disclosure statement requirement
• Why contractors should consider completing a disclosure statement prior to being CAS- covered 
• Who is responsible in administering CAS and making the required determinations and findings 
• The benefits of abiding by CAS
• Pitfalls and compliance considerations for changes in accounting practices, M&A activity and budgeting/forecasting 

Cherry Bekaert’s Government Contractor Industry practice has significant  CAS experience and can help you navigate CAS compliance issues or disclosure statement development. Contact us to discuss your situation.

Don’t forget to keep an eye out for the remainder of our GovCon podcast CAS series, where our hosts will go into more detail on the specifics of the individual CAS standards, general requirements, cost accounting changes and the disclosure statement. 

View all Government Contracting Podcasts

In this episode of Cherry Bekaert's Government Contracting podcast, Brendan Halloran, a Director in Cherry Bekaert’s Government Contracting Industry practice ,and  Jeff Annessa, a Senior Manager in the Firm’s GovCon practice continue our Contractor Business Systems series, discussing system reviews, audit findings, corrective actions, and ACO determinations.

• Indicators of potential findings or noncompliances during a DCAA system audit and steps contractors can take
• The DCMA system review process
• The ACO process in determining the level of deficiencies
• Ways to get a DCAA finding viewed as non-significant and differences between DCAA and DCMA Business System Deficiency terminology
• Tools used by the ACO and how they work through the process
• The corrective action process

Cherry Bekaert's Government Contracting Industry advisors excel in navigating business systems requirements and intricate control environments, offering guidance in the development, maintenance, assessment, and audit preparation of compliant systems for contractors facing reviews by DCAA, DCMA, or related agencies.

View all Government Contracting Podcasts

The Federal Acquisition Regulation (FAR) doesn’t provide many details on the specifics related to an adequate timekeeping system. However, the Defense Contract Audit Agency (DCAA) does have some specific requirements they look for when performing accounting system audits and labor floor checks.

In this episode of Cherry Bekaert’s GovCon Podcast, Eric Poppe, a Managing Director in Cherry Bekaert’s Government Contracting Industry practice, is joined by Jeff Annessa, a Senior Manager in the Firm’s GovCon practice who spent 13+ years with DCAA and held various leadership positions such as Quality Manager, Supervisory Auditor and Field Audit Office Manager, and Jacquelin LaClair, a Manager in the Firm’s GovCon practice who spent 10 years working with DCAA and the Defense Contract Management Agency (DCMA). They discuss one of their favorite topics: timekeeping and the government’s expectations. Listen to find out:

• Why contractors should have written timekeeping policies and procedures in place and should consider including all types of work arrangements available by your organization (in-office, remote or hybrid)
• Key elements for an adequate timekeeping system
• Ensuring segregation of responsibilities for labor-related activities
• Total Hours Worked approach and why the government cares
• Policies and procedures that address how direct and indirect time is recorded
• How to handle paper vs. electronic timesheets  
• The employee and the supervisor roles in certifying the accuracy of timesheets on a daily, weekly, bi-weekly or monthly basis 
• Record retention requirements for timesheets

At the end of the day, would a government auditor be able to review your current timekeeping policies and procedures and compare them to what is currently happening at your organization and find no discrepancies? If you have any questions specific to your situation, we are available to discuss your situation with you. Contact us. 

View all Government Contracting Podcasts

The Defense Contract Audit Agency (DCAA) recently released its Fiscal Year 2022 Report to Congress. By law, the DCAA is required to submit an annual report detailing the DCAA’s activities for the previous year.

In this episode of Cherry Bekaert’s GovCon Podcast, Eric Poppe, a Managing Director in Cherry Bekaert’s Government Contracting Industry practice, is joined by Jeff Annessa, a Senior Manager in the Firm’s GovCon practice who spent 13+ years with the DCAA and held various positions such as Quality Manager, Supervisory Auditor, Field Audit Office Manager and Senior Financial Liaison Advisor, and Jacquelin LaClair, a Manager in the Firm’s GovCon practice who spent 10 years working with the DCAA and the Defense Contract Management Agency (DCMA), discuss key takeaways from the DCAA’s report as an update to Cherry Bekaert’s DCAA Update webinar in February 2023. 

Listen in to find out about:

• Number of audits conducted by the DCAA, noted questioned costs and which audits were performed more frequently
• Overall return on investment (ROI) for each audit type and what this means for government contractors
• Investigative cases
• Sustention rates by audit, how those rates are important to the DCAA and how this impacts contractors
• Timing to complete an audit, by audit type
• Number of incurred cost audits performed by Independent Public Accounting Firms
• How the DCAA assists with Other Transaction Authorities (OTAs), the overall impact to the DCAA and current trends
• Difference between an incurred cost audit and a low-risk memo, when one is issued over the other and how many audit reports and memos were issued by the DCAA in FY22
• Post-pandemic changes occurring within the DCAA
• Establishment of Operations Business Enterprise and Data Intelligence Division (OBD) and what is currently being worked on with the DCAA
• DCAA’s External Peer Review

Whether you are a small business expecting your first audit, or a large contractor preparing for one of your many different audits, Cherry Bekaert’s GovCon consultants work with clients to prep for audits, resolve DCAA findings and have extensive hands-on experience in this subject. If you have any questions specific to your situation, we are available to discuss your situation with you. Contact us

View all Government Contracting Podcasts

In this episode, Eric Poppe, a Managing Director in Cherry Bekaert’s Government Contractor Industry practice is joined by Matt Schiavone, Managing Director, and Brian Kirk, Senior Manager in the Firm’s Information Assurance & Cybersecurity practice to discuss the Department of Defense (DoD) Cybersecurity Maturity Model Certification (CMMC) 2.0 program milestone and what contractors should be doing now to prepare.

Listen in as they share insights into the:

• Recent updates to the final CMMC rule, including next steps and an updated expectation on when it will go final
• Projected timeline implications for contractors and action steps to prepare
• Recommendations for ensuring preparedness for timely achieving a certification

If you have any questions regarding CMMC, Cherry Bekaert’s Information Assurance & Cybersecurity and Government Contracting advisors are available to discuss your situation with you. Cherry Bekaert is authorized by the Cybersecurity Maturity Model Certification (CMMC) Accreditation Body, Inc. (The Cyber AB) as a CMMC Third-Party Assessment Organization (C3PAO). As an authorized C3PAO, Cherry Bekaert assists DoD contractors seeking a CMMC assessment with CMMC readiness and Defense Industrial Base Cybersecurity Assessment Center (DIBCAC) Joint Surveillance Voluntary Level 2 assessments in partnership with the DIBCAC.

Having undergone Level 2 assessment as a Firm, Cherry Bekaert has a deep understanding of the assessment process to guide DoD contractors seeking a CMMC assessment.

Catch up on Cherry’s Bekaert’s previous guidance pertaining to CMMC 2.0:

• Podcast: How Will NIST Special Publication (SP) 800-171, Revision 3 Impact CMMC?
• Article: Updated Projected Timeline for CMMC: What this Means for Contractors and How to Prepare for Certification
• Final CMMC Rule: March 2023 Update
• Podcast: CMMC 2.0 – Where Does It Stand?
• Podcast: What’s New with CMMC 2.0?: August 2022 Update
• Podcast: CMMC 2.0 Brings Major Program Changes
• On-Demand Webinar: CMMC 2.0 Brings Major Program Changes

View all Government Contracting Podcasts

In this eighth episode of Cherry Bekaert’s podcast series on Contractor Business Systems, Brendan Halloran, a Senior Manager in Cherry Bekaert’s Government Contracting Industry practice who was previously a Divisional Administrative Contracting Officer (DACO) at the Defense Contract Management Agency (DCMA), is joined by Roy Rushing, a Manager in the Firm’s GovCon practice and a former Contracting Officer with various federal agencies, to talk about navigating Contractor Business Systems audits and reviews. 

Listen in to find out about:

• The two primary types of system audits/reviews: 
  • Defense Contract Audit Agency (DCAA) audits 
  • Defense Contract Management Agency (DCMA) reviews
• Steps to take early on once you have received notification of a planned audit/review
• Considerations leading up to the audit/review
• Typical timing/scheduling
• Pointers to navigate the process once the audit/review has started
• Benefits of an approved system

If you have any questions specific to your situation, Cherry Bekaert’s GovCon Consultants are available to discuss your situation with you. Contact us

If you haven’t already, catch up on other parts of the series:

• Contractor Business Systems Series: Part 1 – Applicability
• Contractor Business Systems Series: Part 2 – Accounting System
• Contractor Business Systems Series: Part 3 – Cost Estimating System Requirements
• Contractor Business Systems Series: Part 4 – Purchasing System
• Contractor Business Systems Series: Part 5 – Earned Value Management System
• Contractor Business Systems Series: Part 6 – Property Management System
• Contractor Business Systems Series: Part 7 – Material Management and Accounting System

Cherry Bekaert’s Government Contracting Industry advisors are well versed in business systems requirements and complex control environments. We guide contractors in developing and maintaining compliant business systems, performing systems assessments, providing audit support and preparing contractors for audits or reviews by the Defense Contract Audit Agency (DCAA), the Defense Contract Management Agency (DCMA) or other cognizant agencies.

View all Government Contracting Podcasts

In this episode, Eric Poppe, a Managing Director in Cherry Bekaert’s Government Contractor Industry practice, is joined by Brian Kirk, Senior Manager in the Firm’s Information Assurance & Cybersecurity practice, to discuss the impact of the Draft NIST Special Publication (SP) 800-171 Revision 3 on the Department of Defense’s (DoD) Cybersecurity Maturity Model Certification (CMMC) 2.0 program. The Revision 3 draft was released on May 10, 2023, and is out for public comment through July 14, 2023.

Listen in as they share insights into:

• Why the update to NIST SP 800-171 is significant to CMMC
• Timeline for the final version of NIST SP 800-171 Revision 3 and subsequent revisions to the CMMC Assessment Guide, which is based on NIST 800-171 Revision 2
• Revisions to the set of supporting NIST publications on protecting controlled unclassified information, including SPs 800-171A (security requirement assessment), SP 800-172 (enhanced security requirements) and SP 800-172A (enhanced security requirement assessment)
• A summary of the significant changes between NIST SP 800-171, Revision 2 and Draft NIST SP 800-171, Revision 3
• Recommendations to DoD contractors seeking a CMMC assessment with CMMC readiness and Defense Industrial Base Cybersecurity Assessment Center (DIBCAC) Joint Surveillance Voluntary Level 2 assessments in partnership with the DIBCAC

If you have any questions regarding CMMC, Cherry Bekaert’s Information Assurance & Cybersecurity and Government Contracting advisors are available to discuss your situation with you. Cherry Bekaert is authorized by the Cybersecurity Maturity Model Certification (CMMC) Accreditation Body, Inc. (The Cyber AB) as a CMMC Third-Party Assessment Organization (C3PAO). As an authorized C3PAO, Cherry Bekaert assists DoD contractors seeking a CMMC assessment with CMMC readiness and DIBCAC Joint Surveillance Voluntary Level 2 assessments in partnership with the DIBCAC.

Having undergone Level 2 assessment as a Firm, Cherry Bekaert has a deep understanding of the assessment process to guide DoD contractors seeking a CMMC assessment.

Catch up on Cherry’s Bekaert’s previous guidance pertaining to CMMC 2.0:

• Article: Updated Projected Timeline for CMMC: What this Means for Contractors and How to Prepare for Certification
• Podcast: Final CMMC Rule: March 2023 Update
• Podcast: CMMC 2.0 – Where Does It Stand?
• Podcast: What’s New with CMMC 2.0?: August 2022 Update
• Podcast: CMMC 2.0 Brings Major Program Changes
• On-Demand Webinar: CMMC 2.0 Brings Major Program Changes

View all Government Contracting Podcasts