Most Government contractors and prospective contractors realize that an “adequate” accounting system is a necessary prerequisite to winning a negotiated contract. And, there is no mystery to what constitutes an “adequate” system. The attribute are listed on SF Form 1408 – Pre-Award Survey of Prospective Contractor Accounting System. We’ve covered these attributes on this blog several times. See, for example Preaward Surveys – SF From 1408 and Two Kinds of Accounting System Audits. Contractors (and prospective contractors) should not underestimate the importance of an adequate accounting system. Companies have lost out on opportunities by not having adequate systems. See, for example Accounting System Adequacy and Bidder Disqualified for Failing to Provide Evidence of an Adequate Accounting System.
Last February at a hearing in front of the Oversight and Management Subcommittee of the House