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CAS Compliance

When applicable, compliance with Cost Accounting Standards (CAS Compliance) is one of the single hardest challenges contractors face in their accounting and compliance programs.

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CAS Accounting Services

Once a single award is CAS covered, a contractor’s universe changes. Contractors need to measure their readiness for the award of a CAS-covered contract.

Additionally, those contractors who are already CAS-covered have requirements for monitoring compliance ensuring that they bid, book, and bill costs consistent with their disclosed cost accounting practices.

Changes in cost accounting practices in a CAS covered environment bring with it the requirement for cost impact analysis. RKI can assist in navigating CAS including:

  • Evaluation of readiness for a CAS covered award
  • CAS applicability evaluation
  • Administration of cost accounting practice changes, including cost impact analyses
  • Evaluation of CAS compliance with specific Cost Accounting Standards
  • Preparation/Revision of CASB Disclosure Statements

CAS Compliance Services

Our team is skilled and experienced in navigating CAS compliance and CASB Disclosures.


Becoming a Contractor with CAS-Covered contracts is no small feat, nor is it simple to implement the 19 standards. We will help analyze your organization for risk exposure to CAS noncompliance, and devise and execute a plan to fill those gaps with consideration for your oragnization's unique structure.

Cost Impact Analysis

It is important to stay ahead of your cost accounting practice changes, especially as a Contractor with CAS-Covered contracts. We can help analyze the impact of desired, needed, or previously made cost accounting practice changes on affected proposals, and contract claims, and billings. We can also assist on how to best handle cost impact statements and general dollar magnitude (GDM) estimates.

CAS Readiness Reviews

RKI routinely performs CAS readiness reviews of contractors, including an evaluation of current state practices to determine if they are ready to comply with the Cost Accounting Standards (CAS) so that contractor’s can have confidence they are ready to comply with CAS prior to having it apply to their awards.

CAS Compliance
 Frequently Asked Questions

Our team is skilled and experienced in navigating CAS awards and the potential pitfalls that come with them.

Cost Accounting Standards, commonly referred to as CAS, is a set of nineteen (19) standards promulgated by the CAS Board (CASB) designed to ensure uniformity and consistency in the measurement, assignment, and allocation of costs to contracts with the United States Government (USG). CAS covers a variety of costs such as depreciation, pension plans, personal compensation, indirect costs and other areas of cost accounting
The CASB DS-1 is a form required by the United States Government (USG) required for submission for a contract or business segment with Full-CAS applicability (explained below). The CASB DS-1 discloses:
  • General business information;
  • How you distinguish between direct and indirect costs and indirect allocation methodology;
  • Depreciation and capitalization practices;
  • Other costs and credits;
  • Deferred compensation and insurance costs; and
  • Home office expenses.

There are two types of CAS applicability coverage: Modified- and Full-CAS. Click here for an up-to-date guide issued by the Defense Contractor Audit Agency (DCAA) for determining whether your company/business or contract is subject to either Modified- or Full-CAS.

Note: submission of a CASB DS-1 is only required if your company/business or contract is subject to Full-CAS.

CASB DS-1 should not be submitted prior to Full-CAS coverage applicability, unless a solicitation your are pursuing specifically requires it. It is, however, prudent to have the Disclosure Statement prepared and ready (i.e., not submitted to the Government) if you anticipate future Full-CAS coverage.

Absolutely. Disclosure Statement adequacy is only one part of the equation! The Defense Contract Audit Agency (DCAA) actually maintains eight types of noncompliance based on CASB rules, regulations, and standards and FAR Part 31:
  1. Disclosed practices not compliant with CAS.
  2. Disclosed practices not compliant with FAR.
  3. Actual practices of estimating costs not complaint with CAS.
  4. Actual practices of estimating costs not compliant with FAR.
  5. Actual practices for estimating costs not compliant with the practices disclosed in the Disclosure Statement.
  6. Actual practices for accumulating or reporting costs not compliant with CAS rules and regulations.
  7. Actual practices for accumulating or reporting costs not compliant with FAR.
  8. Actual practices for accumulating or reporting costs not compliant with the practices disclosed in the Disclosure Statement.
While DS Done simplifies the formatting adequacy of your Disclosure Statement, CAS compliance requires technical interpretation of the regulations surrounding CAS. For this reason, we offer a complimentary initial consultation upon successful registration and payment on your account and standby should you need extended consulting support throughout your CAS covered journey.

Upon filing and submission of your CASB DS-1 with your Administrative Contracting Officer (ACO) or Cognizant Federal Agency Official (CFAO), they will review for adequacy. Once the ACO or CFAO deems your Disclosure Statement adequate, a government audit agency will be prompted to audit the disclosed accounting practices through an initial Disclosure Statement audit within sixty (60) days. Moreover, your disclosed accounting practices may also be audited indirectly during:

  • Proposal evaluations
  • Estimating system surveys
  • Certified cost or pricing audits
  • Incurred cost audits
  • Other DFARS Systems audits

If you have questions or concerns related to audits, an upcoming audit, or previous audit findings, please don’t hesitate to contact us.

There are many examples of CAS noncompliance. For illustrative purposes, below are a few very basic examples:

  • Contractor uses a direct labor allocation base, as opposed to Total Cost Input (TCI) for its General & Administrative (G&A) expenses when direct labor is not an accurate cost input base representing the total activity of the business (CAS 410)
  • Contractor excludes a subsidiary entity that it supports from its G&A allocation base (CAS 410, 403)
  • Contractor charges procurement personnel as direct labor under some contracts, while treating them as indirect under others in like circumstances (CAS 402, 418)
  • Contractor has significant design engineering and manufacturing expenses with different causal/beneficial relationships to final cost objectives that included in a single overhead pool (e.g., using a single overhead rate when two is warranted) (CAS 418)

To become CAS compliant, contractors must identify the relevant CAS standards applicable to their prospective or current contracts. It's crucial to recognize that not all standards apply to every contract. Therefore, contractors should determine the standards that are relevant to their specific situation.

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