As a federal government contractor you are responsible for submitting an Incurred Cost Submission, if you have at least one contract with the ‘Allowable Cost and Payment’ clause (cost-type or time and materials T&M).
Incurred Cost Submissions have a high probability of being audited, be prepared.
What is an Incurred Cost Submission?
The incurred cost submission is a report of what your actual indirect expenses were for the government to compare to the indirect costs you billed using provisional billing rates.
Also known by Indirect Cost Proposal (ICP) or Indirect Cost Rate Proposal (ICRP).
Who Must Submit an Incurred Cost Submission?
Federal contractor that hold an applicable contract subject to the Federal Acquisition Regulations clause, ‘Allowable Cost and Payment’ (FAR 52.216-7) and/or ‘Payments under Time-and-Materials and Labor-Hour Contracts’ (FAR 52.232-7).
When Must the Incurred Cost Submission be Filed?
Incurred cost submissions are due six months after completion of the contractor’s fiscal year end.
Example: Fiscal year-end 12/31, incurred cost submission are due by 6/30.
Required Submission Schedules
- Schedule A – Summary of Indirect Expense Rates
- Schedule B, C, D – Indirect Cost Pools
- Schedule E – Claimed Allocation Bases
- Schedule F – Cost of Money
- Schedule G – Booked and Claimed Direct Costs
- Schedule H – Direct Costs by Contract at Claimed Rates
- Schedule H-1 – Government Participation by Pool
- Schedule I – Cumulative Allowable Cost Worksheet
- Schedule J – Subcontract Information
- Schedule K – Hours and Amounts on T&M Contracts
- Schedule L – Payroll Reconciliation
- Schedule M – Accounting/Organization Changes
- Schedule N – Certificate of Indirect Costs
- Schedule O – Contract Closing Information
- IR&D/B&P not fully burdened (Schedule B)
- Not all intermediate allocations disclosed (Schedule D)
- Unallowable costs not included in G&A base (Schedule E)
- Government participation not calculated for all final indirect rates (Schedule H-1)
- Physically complete contracts not shown (Schedule I & O)
- Lack of subcontractor information (Schedule J)
- Signed certification not included or not signed by at least a Vice President or CFO (Schedule N)
This is a helpful DCAA self assessment tool for assessing the adequacy of final direct and indirect incurred costs to ensure compliance with the contractual requirements under FAR.
ICE Model Resources
The Incurred Cost Electronically (ICE) Model is an Excel spreadsheet that provides contractors with a standard user-friendly electronic package to assist in preparing timely and adequate incurred cost submissions.
- ICE Model – Template
- ICE Manual – Instructions
- Contractor Submission Portal (CSP) – DCAA’s method for contractors to submit incurred cost proposals
Have Questions or Need Consulting Expertise, We Are Here to Help!
If you have any questions please reach out, we’d love to chat further and assist your organization with your incurred cost submissions, including:
- Prepare your submission utilizing the DCAA ICE Model.
- Review your company prepared submission for adequacy.
- Assist with DCAA audit defense.
About Iuvo Systems
Iuvo Systems is the premier cost-effective GovCon accounting services firm. Iuvo offers services supporting your Quickbooks and Deltek applications including the Costpoint family of products. Iuvo supports government contractors, architecture, engineering & construction, nonprofit, and other project-oriented firms.