PNWC’s Government Contracting Update - page 56

Department of Defense (DoD) contractors are reminded that DFARS (DoD FAR Supplement) 203.1004 requires that the DoD-IG (Inspector General) Hotline Poster be posted in a prominent location if awarded a contract in excess of $5.5 million. Non-DoD contractors have a similar requirement found in FAR 3.1004. Whether contractors have a threshold contract or not, we believe its a good idea for all contractors to display hotline posters. It is integral to good internal controls.

Source: PNWC’s Government Contracting Update: DoD Hotline Posters (revisited)

In 2015, the Navy awarded a contract to HCS Inc to repair a leak in an 8″ water line. After work began, it was discovered that the leak was in a 4″ line that intersected the 8″ line. Since the 4″ line was no longer needed, the Navy instructed HCS to cap the 4″ line, thus solving the leakage problem.

Source: PNWC’s Government Contracting Update: Navy Tries to Reduce Fixed Contract Price after Work Completed – ASBCA Says “No”

Be careful if the Government asks you to enter into a no-cost storage contract. It may cost you some money.

Source: PNWC’s Government Contracting Update: There are Costs Associated with No-Cost Storage Contracts

Most contractors doing business with the Federal Government are subject to the FAR Part 31 cost principles among which FAR 31.201-6 requires contractors to identify and exclude unallowable costs from any billing, claim, or proposal applicable to a Government contract. How contractors go about doing this varies widely. The most efficient way to identify and exclude unallowable costs is to make a determination at the time the expense is first recorded and drop it in the appropriate “bucket”; allowable or unallowable. That method assumes that (i) contractors have someone reasonably familiar with FAR Part 31 in their accounting departments to make those determinations and (ii) that their accounting systems are set up to record and segregate unallowable costs. More common among small contractors is the ritual of “scrubbing” records for potentially unallowable costs at the time a submission is made. So, for example, contractors submitting annual incurred cost submission will follow due diligence to identify and exclude unallowable costs from its indirect cost expense pools.

Source: PNWC’s Government Contracting Update: Costs Related to Extraordinary Reviews of Incurred Costs

In 2015, GSA (General Services Administration) issued a solicitation for “customized training and development services, customized human capital strategy services, and customized organizational performance improvement services”. The solicitation contemplated multiple awards under an ID/IQ (indefinite-delivery, indefinite-quantity) arrangement where individual task orders would be issued.

Source: PNWC’s Government Contracting Update: Failure to Follow Solicitation Instructions Leads to Lost Opportunity

Yesterday we discussed a contractor’s lack of robust internal controls that allowed an employee to embezzle $1.3 million over a four year period. If you missed that post, you can read it here. Every company needs internal controls but small companies sometimes cannot afford to have comprehensive systems to guard against fraud, waste, and abuse. But there are things even the smallest company can afford.

Source: PNWC’s Government Contracting Update: Internal Control Questionnaire for Small Contractors

Just a week ago, we reported on a case where a highly trusted contractor employee embezzled $825 thousand from his company by using a company issued credit card for personal expenses. Now we have another misuse of company credit card case being reported by the Department of Justice. This time, the perpetrator made $1.3 million in unauthorized personal charges to a company credit card. He has pleaded guilty and has agreed to pay restitution and when he appears for sentencing, faces additional fines and possibly prison time. This time however, the perpetrator was not someone in a trusted position in the company – he was a lowly accountant who got away with the embezzlement for four years. Cases like these should really be wake up calls for companies to examine their own company-issued credit card policies and related internal controls. As we all know, “trust” is not an internal control.

Source: PNWC’s Government Contracting Update: Another Credit Card Embezzlement Scheme

The Department of Labor’s Wage and Hour Division issued the final rules on paid sick leave for Federal contractors. These new sick leave rules were based on the President’s similarly titled Executive Order from September 2015.
Source: PNWC’s Government Contracting Update: Labor Issues Final Rules on Paid Sick Leave for Federal Contractors

If you have an iPhone or or an iPad or if you have iTunes on your computer, you can now download a free copy of the FAR (Federal Acquisition Regulations) to read (oh boy!) or reference. GSA (General Services Administration) released an iBook version of FAR last week. If you have an Android device or use Kindle, you will have to wait a little while longer. Those versions are coming, GSA promised.

Source: PNWC’s Government Contracting Update: New Electronic Format for FAR Available for Free Download

For the past few days, we’ve been posting articles on FAR’s fiscal year end regulation dump – prompted, no doubt, by someone’s performance evaluation and bonus prospects (yes, Feds do get bonuses). So far, we’ve discussed the new regulations that cap compensation levels for contractor employees, the prohibition from taking reprisal action against any employee who may want to discuss or disclose their compensation, and prohibitions on contracting with tax deadbeats and felons. Today we will be discussing new regulations that may foretell a change in use of DUNS numbers – a unique nine digit identification number for each physical location of a business and a requirement for registering in SAM (System for Award Management).

Source: PNWC’s Government Contracting Update: DUNS Numbers May Soon be Replaced