Do you have the clause FAR 52.216-7 “Allowable Cost and Payment” in any of your contracts? If you do, you likely have a requirement to prepare an Incurred Cost Submission for your company and submit it to your local DCAA office 6 months after your fiscal year-end. Typically, this FAR clause is incorporated in cost reimbursable contracts and Time-and-Materials (T&M) contracts that are direct to the government or a flow-through from a prime contractor. A fixed-price contract may also have a cost-reimbursable element(s) so be sure to check all your contracts for this clause that triggers the requirement for submission.
If you had a PPP loan, the forgiveness should be recognized in the year forgiveness occurred. The amount of a PPP loan that is forgiven will apply as a credit or cash refund under FAR 31.201-5. DCAA has not yet provided clear guidance on the full mechanics of the forgiveness credit, including if the credit should be included in the allocation base. We are following the guidance and will continue to communicate additional information as it becomes available.
If you discover that you do have the requirement or would like help in the preparation or review of the submission, we’d be happy to help with that. Please contact Michelle Jenkins or Amanda Jenkins and we can get you on your way to compliance!