Subcontractor Wrap Question

Are you the Prime or a tier sub? If you're the Prime, what type of contract is it? What type of contract is the Subcontract?

Is the Prime contract subject to full or modified CAS?

Also - I'm assuming the contract doesn't speak to this since you're asking. Does your proposal describe your cost build up and was it incorporated by reference?

It really depends on the company's accounting practices. How was the projected 10% G&A rate calculated? Were projected subcontract costs included in the projected base? If so, then I would say you are right. They must be consistent in estimating and accumulating costs.

Sounds like your new company may be using a value-added cost base whereby material and subcontract costs are removed from the base used when G&A expenses pertain more to the contractor’s in-house activities than to material and subcontract activity.

We are the prime and the contract is CPAF. SubK is CPAF also.

Thanks for the replies, all.

Whynot had the correct answer. Thanks again!

SpartanHead, I would add to the previous comments that since you are new to your company, you could benefit from an appointment with your Government Accounting department. They can explain the cost structure, the burdening sequence, and alert you with any other items that are pertinent to your position there. I always make a point to spend time with new people and provide them with all the tools they need to be compliant!