Driving Success for Government Contractors
Few industries are as highly regulated as government contracting. From Federal Acquisition Regulations (FAR) to specialized tax and audit rules, government contractors face a myriad of hurdles to efficiency and profitability. PBMares understands the complexity of your challenges and offers an unmatched level of knowledge and support to help these businesses succeed. Providing assistance to businesses of all sizes, we work closely with government contractors in aerospace, defense, manufacturing, technology, construction, not-for-profit and professional services, including engineering, to help them operate efficiently and achieve their goals.
SOLVING BUSINESS ISSUES
“Dynamic Aviation owns and operates a large fleet of aircraft and has numerous complex government contracts. We consistently benefit from PBMares’ exceptional wise counsel as we move through complicated business transactions. We’ve been able to make wiser and more informed decisions, and as a result we have experienced improved financial performance.”
Helping new and experienced government contractors with the specialized expertise and personalized support your business demands.
Our experienced Government Contracting Team delivers a full range of accounting, audit and business advisory services designed to meet your unique needs:
To be able to win a contract, government contractors need to show they can meet government requirements. Often, you are required to submit SF 1408, Pre-Award Survey of Prospective Contractor – Accounting System, with your proposals to show that your accounting system is compliant. An assessment of your accounting system will allow us to help you complete this form and, in the event you’re not compliant, we can help you improve your accounting system. Demonstrating compliance will give you a competitive edge over government contractors that can’t do the same.
There are well-defined rules that dictate what costs are allowed and which are not as part of a government contract. In some cases, these rules contradict generally accepted accounting principles. Determination is complicated further by the circumstances surrounding the cost and allocability. The experienced members of our government contracting team can help you determine what is allowable and help you discuss the reasoning behind the determination with auditors.
Getting your indirect costs properly allocated is crucial if you are going to continue to be successful in the area of government contracting. A solid cost allocation structure will help you win work and help ensure your accounting system is adequate. However, it can also present risk—improper allocation leads to business system deficiencies, potential disclosures and reduced profitability. And if you haven’t reviewed your allocation structure in years, you may not be recovering everything you can. Let PBMares help you:
- Develop, implement and/or analyze your cost allocation structure
- Allocate costs to ensure compliance
- Understand your rights when it comes to contract changes or requests for equitable adjustment
- Complete a contract change proposal for equitable adjustment
Government contractors face a host of regulations and unique risks which often seem overwhelming. Not only do you have to comply with Federal Acquisition Regulations (FAR) and the Defense Contracting Audit Agency (DCAA), you have third parties who have an interest in your business. When your audit plays a role in securing new contracts, you need a risk-based approach tailored to satisfy regulators to ensure you keep Uncle Sam happy. We can help you with:
- Audits, compilations and reviews
- Risk advisory services
- Agreed upon procedures
Are you a government contractor looking to borrow money to expand your business? With financial institutions facing increased regulations and scrutiny, government contractors looking to secure a loan need to ensure the collateral documentation being provided as part of the loan package is complete and correct. For government contractors, this means providing an accounting of unbilled receivables. PBMares can review your company’s contracts to ensure you are billing correctly.
It’s important to set the tone at the top by establishing the right internal controls to make sure you don’t get into trouble. As a government contractor, you need a robust internal control system to ensure effective and efficient operations, reliable financial reporting and compliance with laws and regulations. This is an important step to increase efficiency and reduce the potential for fraud to take place, ultimately increasing profits.
Many government contractors are taking advantage of state and local grants and incentives designed to encourage businesses to invest in and create jobs within specially targeted areas throughout the state. If you need help determining if your company qualifies, our enterprise zone specialists can guide you through the various options and requirements.
Business systems help companies run day-to-day operations. They are a requirement for government contractors hoping to win a contract. If your accounting, cost estimating or material management systems, among others, contain deficiencies, you can lose a percentage of your current payments and face an uphill battle when it comes to winning new contracts. We can review your current systems to ensure they meet current government requirements and show you where gaps in compliance may exist.
When a contract is physically complete, you need to close it out to establish the final price so a final payment is made. Not only is the process complex even when completing a quick-close process, but it can take many months to complete. Our government contracting professionals can help you prepare the close and help with the negotiation process.
When you face a DCAA audit, you need everything to run smoothly. When there are any findings or deficiencies, you have to issue a response as to how they will be corrected immediately. We can help you develop a solid relationship with the DCAA by interfacing with them on issues from submission to approval to audit negotiation, if needed.
Government contractors are held to a higher standard and need to work harder to minimize the risk for fraud. You need to be proactive in complying with regulations before you get into trouble and face suspension or disbarment. With an understanding of government contracts, we know where to look for fraudulent activities. If your company has already been breached, you need a team that can help you minimize the impact on your organization. Let us protect every dollar you earn through:
- Independent corporate monitoring
- General fraud investigations
- Regulatory compliance
- Dispute resolution
If your contracts contain a FAR clause for cost reimbursement, then you have to submit an adequate incurred cost submission (ICS) annually to the DCAA. This calculation of indirect cost rates that can be charged to the government throughout the year has to tie out and not include any expressly unallowable costs in order for adjustment to be made. Let us help you prepare your ISC. Better yet, talk to us before accepting a contract with the FAR 52.216-7 so we can help you understand this compliance requirement.
It’s a busy time for mergers and acquisitions as government contractors are trying to diversify to compete for larger contracts. Going down that path can be stressful, and you need someone at your side who understands your company and the industry in which you operate. There are a lot of rules around buying and selling which require robust due diligence procedures at every step. The fact that you are a government contractor adds more complexity to the process. As government contacting specialists, we can help you with:
- Due diligence
- Business valuations
- Pro forma combined financial statements
- Placement of debt/equity
- Accounting method advice
- Tax-efficient transaction structure
Do you have a policies and procedures manual to ensure that controls are in place for your accounting and financial reporting? It is a requirement of FAR to demonstrate that you not only know the government contracting rules, but that you are taking active steps to comply with them. In addition, the policies and procedures are imperative for a pre-award system audit. You want to make sure you have a manual in place before the DCAA comes looking for it. Let us help you put your initial policies and procedure manual together or review your current one to ensure your accounting system is compliant. More importantly, we can work with you to ensure employees know the policies and are following them.
As a government contractor, you know the government has the ability to unilaterally terminate the contract at any time, in whole or in part. When you receive a termination notice, you need to act fast and follow procedures to protect your rights. This includes submitting a termination settlement proposal. The good thing is this proposal can help you recover direct and indirect costs, the cost of preparing the proposal and settlement and, perhaps, even interest. Our government contracting specialists can help you prepare and negotiate the settlement proposal so you can recover the costs you can effectively document.
As a government contractor, you operate in a highly competitive environment. Translation: you need to keep your company lean. From R&D credits to your company’s structure to credits available to you, a well-designed, analysis-based tax strategy that focuses on your company’s specific needs and goals will help you manage your tax liability. To ensure you pay only the taxes you are legally obligated to pay, PBMares can provide the following:
- Preparation of Corporate, S Corporation and Partnership and LLC tax returns
- Tax projections
- Tax planning
- State and local tax
- International tax
- Credit and incentives
- Representation before the IRS, state and local tax authorities