Join Government Contract Services Group experts La-Tasha Patel and Aisha Mian on November 14th for their Unanet webinar, “Improve Your Outcomes on Cost Type Contracts.” La-Tasha and Aisha will take a look at the complex world of cost type government contracts and help you improve your outcomes on cost type contracts.
Many government service contractors successfully enter the government market with relatively straightforward labor hour, or time & material (T&M), contracts. Eventually, an opportunity to bid and perform larger and more complex cost reimbursement contracts will present itself. The skills required to manage T&M contracts differ markedly from the skills required to manage a cost type contract. While the statements of work may be very similar, the administrative requirements associated with managing a cost type contract greatly exceed those required for T&M work.
Managing cost type contracts is a sophisticated undertaking. The contractor must understand what a “cost” is, have an adequate accounting system, establish both direct and indirect budgets, actively manage them, and with actual rates, not billing rates.
Failure to comply with these requirements can have serious ramifications, including incurring a loss, a poor cash flow, inaccurate cost reporting, and an inadequate accounting system. An understanding of your obligations is essential to mitigating your risks, maximizing your cost recovery, and maintaining your bottom. This is the difference between recovering your costs, making a profit, or losing your shirt.
Attendees of this webinar will learn:
- What an "adequate" accounting system must include
- Which costs can and can't be reimbursed
- How direct costs are reimbursed
- How indirect costs are reimbursed
- How to handle invoicing on cost-type contracts
- How to define the "Paid-to Cost" rule
- What limitations of Cost-and-Funds clauses are
- How to facilitate a cost type contract in an accounting system