Understanding Federal Acquisition Regulation (FAR 31)

Falling prey to the economic downturn, it’s quite trending amongst several engineering and architectural firms to seek out majorly for government contracts in comparison to other development projects. This trend has mandated these firms to have their overhead rate calculated in compliance with the FAR(Federal Acquisition Regulation). More concerned about the profitability, that government contract promises, the firms are lesser acknowledged and thoughtful about the FAR audit’s requirements. Late and less knowledge of FAR makes them prone to unwanted audits and lesser profitability where many CPA’s are also unfamiliar about this particular field of accounting. In recent years it has become mandatory for a firm to have an accurate overhead rate calculation instead of an estimated FAR overhead rate used by the firms.
In their contract Government can impose varied obligations as per established by FAR. Thus these agencies can be either demanding contract bids or can even insist upon the firm’s overhead rate in accordance with FAR. In addition it can be the company’s schedule for audited overhead or parallel footnotes; which they will look out for.http://www.joycecpallc.com/understanding-federal-acquisition-regulation-far-31/