Government Contract Accounting Made Easy: The Uncomplicated Guide to Compliance, Pricing, and Profitability

By Robert E. Jones

Government Contract Accounting is Confusing

 

Accounting is especially difficult for companies supporting the government, and businesses can quickly get into a mess. While the orange jumpsuits are generally reserved for fraud, bribery, or other egregious acts, you could end up with an unapproved system, disallowed costs, and be mired in a never-ending list of DCAA audits.

This book simplifies these processes so even a non-accountant can understand them. Government Contract Accounting Made Easy: The Uncomplicated Guide to Compliance, Pricing, & Profitability will show you how to:

· Build an indirect rate structure focused on total cost recovery
· Maximize company profitability
· Understand accounting and contract lingo in the government contractor world
· Prepare for and thrive in audits
· Maintain compliance with U.S. GAAP, FAR, DFARS, & DCAA

Success in government contracts comes through compliance and profitability; this book helps you understand how to achieve both. Demystify Government Contract Accounting today!

• Language: English
• Publisher: Robert E. Jones
• Release date: Oct 11, 2023
• ISBN: 9798988831211

Book preview

Praise

If you are serious about growing a sustainable, profitable, business with government clients, this book on government accounting is for you. Robert is a practitioner in the government contract space with real life experience helping businesses of all sizes. He has grown his business from a solopreneur to full time staff, so he also understands the challenges of entrepreneurs wearing many hats, bootstrapping, trying to get paid on time. This book is written by an accounting expert for small business owners looking to leverage the expertise of accounting professionals to grow profitable businesses that won’t get them in trouble with taxes or government compliance requirements. This book is a must read to help you understand government accounting rules that affect the success of your government business.

—Shenê Commodore, CPCM, Fellow CEO –

Commodore Consulting, LLC

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Robert Jones’ Government Contract Accounting Simplified is my go-to publication on the topic. It’s clear, authoritative, and written in a manner that even non-accountants can not only understand the concepts, but receive actionable advice. I especially like the in-depth treatment of indirect rates and cost of money—two topics that I have always struggled with. Simple yet not dumbed down advice applicable to the government contract accountant as well as the business owner and contracts community.

Highly recommended.

—Donald E. (Don) Shannon CFCM, CPCM – The Contract Coach

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This book clearly and concisely explains essential concepts behind government contract accounting, budgeting, and pricing. Drawing on years of experience working with businesses of many sizes, stages, and specialties, Robert outlines the guidelines—and common pitfalls to avoid—to help you ensure both compliance and profitability in federal contracting. Whether you are an accountant or a business owner, you will benefit from having a copy of this book in your library.

—Robert C. Smith, CPA

CEO, ICAT Systems

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Robert’s book is your ultimate go-to guide for government contract accounting. Beyond substantial guidance to ensure compliance with a myriad of governmental regulations, he offers numerous tips, resources, and best practices to help you manage and maximize government contracts. Robert eats, drinks, sleeps, and breathes government contract accounting—so you don’t have to!

—Jon Lokhorst, CPA, PCC,

Executive Leadership Coach and Consultant

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Robert Jones consistently delivers the highest quality instruction in the area of government contract accounting. Our audience praises Robert for his clear communication style and concise delivery. Robert has a gift for teaching with clarity and distilling even complex topics down to their main elements. Government contract accountants are empowered through the education they receive from Robert.

—Liz Briggson, Director of Education and Partnerships, Encoursa

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If you want a simplified, uncomplicated instructional book on government contract accounting, look no further than this book. From the easiest explanation of each cost accounting standard I have ever seen, to breaking down indirect cost rate preparation, budget analysis, proposal preparation and provisional billing rates, this book really has it all in an easy-to-read format for anyone involved in government contract accounting. Robert has done a fantastic job of breaking down every element of government contracting to its simplest form, with excellent examples and models throughout the book. This book is a must have in your government contract accounting library.

—Kellianne Mayer, CPA, CPCM, CDA,

Manager Government Contracts

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Chock full of references, checklists, and guidance, the new book from Robert Jones, Government Contract Accounting Simplified, is a must-read for those dealing with financial aspects of government contracting. This book fits contractor personnel that have some basic financial knowledge, but want to know more about government accounting. Robert is able to lay out complicated federal accounting that government contractors need to know. As a lawyer (and someone who is accounting-challenged) I was able to read it and glean key insights (e.g. overhead vs. G&A) on federal government accounting rules in a short amount of time. While it’s no substitute for an accountant, definitely check this out if you perform work with the federal government, and that work involves the financial aspects of your business.

—Shane J. McCall, Equity Partner, Koprince McCall Pottroff LLC (boutique federal contracting law firm) and

Editor, SmallGovCon.com (legal blog)

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Government Contract Accounting

Made Easy

The Uncomplicated Guide to Compliance, Pricing, and Profitability

Robert E. Jones

CPA, CPCM, NCMA Fellow

Edited by:

Suzanne Slack Camden

CFCM, CPCM, NCMA Fellow

Copyright © 2023, Robert E. Jones

All rights reserved. No part of this book may be used or reproduced by any means, graphic, electronic, or mechanical (including any information storage retrieval system) without the express written permission from the author, except in the case of brief quotations for use in articles and reviews wherein appropriate attribution of the source is made.

Publishing support provided by

Ignite Press

5070 N. Sixth St. #189

Fresno, CA 93710

www.IgnitePress.us

ISBN: 979-8-9888312-0-4

ISBN: 979-8-9888312-1-1 (E-book)

For bulk purchase and for booking, contact:

Robert E. Jones

[e-mail]

www.LeftBrainPro.com

Because of the dynamic nature of the Internet, web addresses or links contained in this book may have been changed since publication and may no longer be valid. The content of this book and all expressed opinions are those of the author and do not reflect the publisher or the publishing team. The author is solely responsible for all content included herein.

Library of Congress Control Number: 2023913464

Cover design by Vivek Kumar Sahu

Edited by Suzanne Slack Camden and Charlie Wormhoudt

Interior design by Jetlaunch

FIRST EDITION

Acknowledgments

Special thanks to Suzanne Slack Camden, my content editor, colleague, and friend who helped me bring this book to fruition.

Thank you to my partner, Andy Goodall, who endured evening and weekend work, conferences, travel, education, training, certification, and CPE on this journey of my career.

Table of Contents

From the Author

From the Editor

Resources

SECTION 1: RULES AND REGULATIONS

Chapter 1: Ten Principles of Accounting

Chapter 2: Ten Principles of GAAP

Chapter 3: Federal Acquisition Regulations and Supplements

Chapter 4: Cost Accounting Standards

SECTION 2: INDIRECT RATES

Chapter 5: Chart of Accounts

Chapter 6: Cost Pools

Chapter 7: Fundamentals of Indirect Rates

Chapter 8: Advanced Indirect Rates

Chapter 9: Monitoring and Managing Indirect Rates

Chapter 10: Indirect Rate Analysis

Chapter 11: Accuracy of Indirect Rates

SECTION 3: BUDGETS

Chapter 12: Three Types of Budgets

Chapter 13: Three Approaches to Budgets

Chapter 14: Updating Provisional Billing Rates

SECTION 4: PRICING AND PROPOSALS

Chapter 15: Strategic Pricing

Chapter 16: Developing Your First Cost and Price Proposal

Epilogue

About the Author

References

From the Author

Why a book about government contract accounting? Because I’m passionate about this topic. I want to see businesses succeed in government contracts and achieve maximum profitability while maintaining compliance with rules and regulations.

Who should read this book? Business owners, managers, accountants, fellow CPAs, CFOs, controllers, contract managers and administrators, project managers, contracting officers—anyone with a financial role in a government contracting organization.

How to use this book. This book is a guide for many recurring accounting tasks. For accountants and financially minded individuals, you may get some advice and head to the races able to execute with little or no assistance. For non-accountants, you’ll leave with awareness of accounting topics and issues that need to be addressed in your organization—please share this book with your accounting and finance team.

What if I need more help? I recognize that many readers will need additional help because they don’t understand the complexity of the topic, don’t understand how to execute a solution in their organization, lack the resources, or simply don’t have enough time. Whatever your reason, don’t hesitate to contact us for assistance.

From the Editor

In 2006, the defense contractor I worked for as a business manager sublet space from another defense contractor. Robert Jones was the Chief Administrative Manager for the other company conducting all the tasks for accounting, contracts, HR, and security. That’s how we met. Robert and I had a lot in common, and we quickly started to team up on contract initiatives and other business issues for both companies.

As Robert’s company grew, he hired me to run contracts and security while he managed HR and accounting. Time passed, and ready for a change of pace and a new city, Robert left the company, and I was asked to assume Robert’s role.

I was unsure about taking Robert’s position as the accountant for a defense contractor. By this time, I knew enough about the job to understand there are a lot of nuances to government contract accounting, and I immediately knew I didn’t know enough. I searched the market for references that would help me understand compliance and practices related to government contract accounting, but I couldn’t find anything. All the options addressed government accounting from the government’s perspective, not as the contractor who is working for the government.

Frustrated, I enlisted the only accountant in our area who understood the government contract accounting requirements. She drew me into a professional contracting organization where I met other like-minded people. Unfortunately, there was still no tome of knowledge for reference, but at least I found solidarity with these contract and accounting professionals. Robert soon joined us at conferences and events, and we continued to share information, develop training, and research the specialty.

Fast forward 15 years, and today, Robert’s Government Contract Accounting Made