{"id":1037,"date":"2022-01-10T09:30:32","date_gmt":"2022-01-10T14:30:32","guid":{"rendered":"https:\/\/www.diener.org\/?p=1037"},"modified":"2023-05-22T17:43:16","modified_gmt":"2023-05-22T21:43:16","slug":"how-to-submit-an-incurred-cost-proposal","status":"publish","type":"post","link":"https:\/\/www.diener.org\/how-to-submit-an-incurred-cost-proposal\/","title":{"rendered":"How To Submit An Incurred Cost Proposal"},"content":{"rendered":"

DCAA<\/a> auditors are not permitted to assist contractors in preparing and developing an incurred cost proposal. Therefore, contractors should know how to submit an incurred cost proposal or work with a certified public accountant to ensure that the Federal Acquisition Regulation (FAR)<\/a> guidelines are properly followed. This review provides an overview of how to submit an incurred cost proposal and answers frequently asked questions in regard to the submission process. <\/p>\n

What Is An Incurred Cost Proposal?<\/h2>\n

An incurred cost proposal, also called an incurred cost submission or ICS, shows a contractor\u2019s indirect costs spent on government-issued contracts at the end of each fiscal year. An incurred cost proposal is submitted to the Defense Contract Audit Agency (DCAA), and a DCAA auditor reviews the submission and determines whether the government owes the contractor money, the contractor owes the government money, or the costs on both sides have been settled. In some respects, an incurred cost proposal works similarly to a personal income tax return. <\/p>\n

When Is An Incurred Cost Proposal Required?<\/h2>\n

Contractors<\/a> are required to submit an incurred cost proposal at the end of every fiscal year. You are allowed up to six months after the fiscal year ends to submit your incurred cost proposal to the DCAA auditor. This means that your incurred cost proposal must be submitted within six months of the end of each fiscal year. Auditors are required to assess the ICS within 60 days after receipt of the submission.<\/p>\n

Keep in mind that the DCAA does not grant an extension for submitting your final incurred cost proposal. A failure to submit on time could be detrimental to your business\u2019 ability to procure contracts with the Department of Defense (DOD) and other government agencies in the future. <\/p>\n

The Different Parts Of The Incurred Cost Proposal<\/h2>\n

There are fourteen different components to the incurred cost proposal. This includes, but is not limited to, indirect cost pool and base components (Schedule A through E), direct cost by contract at the funding or billing level (Schedule H\/H-1), cumulative incurred cost, cumulative billing, and calculation of the over\/under billing amount (Schedule I), presentation of time and material contracts and certification of final indirect costs (Schedule K and N), and lastly various supplementary financial records (Schedule F, J, L, and O). A more detailed breakdown is as follows:<\/p>\n