What should government contractors do to protect themselves if the federal government shuts down? There are steps to be taken before, during and after a shutdown.

Glen Burnie, MD -- (SBWIRE) -- 04/13/2011 -- If the federal government shuts down due to a budget impasse, companies with government contracts should take steps to protect themselves and their federal projects before and during a shutdown.

"If Congress and the president fail to pass a continuing resolution or a budget and the federal government shuts down, everyone working on a government contract faces a lot of uncertainty," said Veronica Eyenga, president and CEO of VBP OutSourcing, Inc.

"There are things government contractors should do before and during a shutdown to protect themselves and their projects."

Eyenga, whose firm specializes in accounting and marketing for firms doing business with the federal government, noted "there is no 'one size fits all' answer. It really depends upon the contract, whether the agency and project involved are deemed essential, and whether the agency undergoes a 'hard' or 'soft' shutdown."

Compounding the uncertainty, Eyenga said, "is that, according to emails reported by USA Today, the Office of Management and Budget (OMB) has instructed agencies not to discuss the possible consequences of a shutdown."

In a government shutdown, most agencies would employ a skeletal crew of essential employees, primarily those that protect life or federal property. In a soft shutdown, federal employees would come to work but would be barred from doing anything "productive." In a hard shutdown, non-essential employees would be barred from federal buildings. Presumably, contractors whose work brings them into federal buildings would be barred as well. Even companies making deliveries to federal buildings would be locked out.

According to Smart Contracting, contractors whose work is deemed non-essential should receive a Notice of Scope of Work Affected, Timetable and Permissible Activities from their Contracting Officer. In the last government shutdown, Bloomberg Government noted, contractors providing health and defense services were termed essential, while many information technology contractors were not.

Contractors have been paid upfront will probably be allowed to continue to work. "Those who haven't been paid upfront, or received a notice from their CO that work should continue, may not be reimbursed if they continue to work in anticipation of being paid later," Eyenga added. "In the 1995 government shutdown, which lasted 21 days, some contractors were legally prohibited from being reimbursed. We're advising our clients not to gamble on reimbursement unless they're told beforehand in writing that they'll be paid for work performed during a shutdown. And volunteering isn't an option: The Anti-Deficiency Act (31 U.S.C. §1342) prohibits agencies from accepting volunteer services to replace federal employees.."

Another wrinkle, according to Eyenga, involves subcontractors. Because the government's stop work order only applies to prime contractors, prime and subcontractors should review their contracts for flow sdowns of limitations of funds clauses. No flow down could mean that subcontractors have a payment claim against the prime contractor, even if work is halted.

"Some of the costs of shutting down and restarting projects may be recoverable by contractors if those costs are documented," Eyenga said. "But it's imperative to talk to the CO both before and after a shutdown. Also, Congress may or may not allow recovery of back pay or consequential damages in the event of a shutdown and restart.

"Before and during a shutdown, talk to the CO. That communication is critical. Look internally as well, to see how employees working on government contracts can be reassigned if their projects are halted by a shutdown. This might be a great time to send them for mandatory training, encourage them to take paid leave or vacation, or tackle some internal projects you haven't had the time or personnel to complete.

"The other critical task is to look at your cash flow, and prepare for the contingency that federal payments – even those you've already invoiced – might be delayed or reduced. Do everything you can to insulate yourself from all of the possibilities of a government shutdown."

For more information, visit http://www.vbpoutsourcing.com or call 410-590-5000.

About VBP OutSourcing
VBP OutSourcing is a Maryland-based, professional accounting and marketing firm servicing the growing needs of DoD federal contractors. Whether you have a need for DCAA government cost accounting solutions via QuickBooks and Peachtree software or you need to strengthen the links between your company's brand and the federal government with a strong capability statement, website or brochure, our professional team is ready to assist. We've been helping government contractors gain more federal business and also meet their DCAA compliance requirements for over 13 years. For more information call 410-590-5000 or visit http://www.vbpoutsourcing.com.

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All signs point to DCAA audits becoming even more thorough and difficult to pass, making DCAA compliance of accounting systems even more critical.

Glen Burnie, MD -- (SBWIRE) -- 03/16/2011 -- Testimony by the head of the Defense Contract Audit Agency (DCAA) and a GAO report on government inefficiencies will mean closer scrutiny for government contractors, according to Veronica Eyenga, president and CEO of VBP OutSourcing, Inc.

Eyenga, whose firm specializes in accounting and marketing for firms doing business with the federal government, sees DCAA audit standards tightening in 2011. "DCAA Director Patrick Fitzgerald is highlighting the 'tightened net' that he says has already saved the taxpayers $3 billion, and DCAA has hired 500 new auditors in the last two years to increase their contract oversight. In addition, a Government Accounting Office (GAO) report released a few days criticized spending on duplicate projects by federal agencies. The DCAA audits contracts for DoD agencies and several other federal agencies.

"The handwriting is clear: government contractors, and companies thinking about competing for government contracts, must ensure that their accounting systems will pass a DCAA audit. The scrutiny is going to be tighter than ever. In past years, DCAA has been criticized for being too close and friendly with the contractors it audited. All of the signs point to the pendulum swinging the other way."

Not all of the news is grim, Eyenga noted: "The DoD is pushing for an increase in its budget for 2011, which could mean more money for contractors. But winning, fulfilling and being in compliance with those contracts is going to be more difficult."

Eyenga recommends, at a minimum, that firms have their accounting systems mock audited by an outside expert to find issues likely to be flagged by a DCAA auditor. "DCAA audits are pass-fail," she said. "Even a minor deficiency finding can mean reduced or delayed payments on a government contract. In fact, because DCAA can audit a company before a contract is even signed, a non-compliant accounting system can mean the contract is given to someone else. You want to find and correct any deficiencies before a DCAA auditor does.

"Properly setting up, maintaining and documenting your accounting system now can proactively avoid a lot of problems later, whether you do it in-house or outsource it."

For more information, visit http://www.vbpoutsourcing.com.

About VBP OutSourcing
VBP OutSourcing is a Maryland-based, professional accounting and marketing firm servicing the growing needs of DoD federal contractors. Whether you have a need for DCAA government cost accounting solutions via QuickBooks and Peachtree software or you need to strengthen the links between your company's brand and the federal government with a strong capability statement, website or brochure, our professional team is ready to assist. We've been helping government contractors gain more federal business and also meet their DCAA compliance requirements for over 13 years. For more information call 410-590-5000 or visit http://www.vbpoutsourcing.com.

For more information on this press release visit: http://www.releasewire.com/press-releases/release-3.htm

DCAAPortal.com is a new, comprehensive website for government contractors and DCAA accountants, with more unbiased, expert information about DCAA accounting than any other site.

Glen Burnie, MD -- (SBWIRE) -- 01/06/2011 -- A new, all-inclusive accounting resource center for government contractors, DCAAPoral.com, will launch today with hundreds of pages of information for firms of all sizes.

Assembled by VBP OutSourcing, a leading government accounting firm in Maryland, the site is the first time all of the information about DCAA-compliant accounting for government contractors has been available in one spot.

"The federal government is the largest purchaser in the world, and many companies are well qualified for a piece of the pie," noted VBP President and CEO, Veronica Eyenga. "One of the biggest hurdles is building and maintaining an accounting system which is DCAA (Defense Contract Audit Agency) compliant. The second hurdle is passing a DCAA audit. DCAAPortal.com is the first site that pulls together all of the information needed to meet both of those goals in one place."

Over a year in the making, the site includes unbiased information on DCAA rules and regulations, DCAA news, software set-up and audit checklists, and guides, templates and training materials. Visitors can use the site to make their own accounting systems DCAA compliant, or find an accounting firm in their state with DCAA expertise.

"By offering government contractors a central website to answer all of their DCAA questions, we hope to make the auditing and contracting process a little easier," added Eyenga. "Our firm has over a decade of experience working in the government sector, and we know the questions our clients and prospects ask every day. We couldn't find a single, comprehensive DCAA information resource on the web, so we created DCAAPortal.com."

For more information, visit http://www.dcaaportal.com.

About VBP OutSourcing and DCAAPoral.com
VBP OutSourcing is a leading DCAA accounting firm specializing in helping DoD contractors achieve government contracts and meet their cost accounting requirements. DCAAPortal.com will offer guidelines and references for all major aspects of the audit process, books and tutorials to purchase or download, and the option to advertise or list one's firm on the site. For more information about advertising or listing with DCAA portal or how VBP OutSourcing can help you customize government marketing or accounting solutions for your business visit http://www.vbpoutsourcing.com or http://www.dcaaportal.com

For more information on this press release visit: http://www.releasewire.com/press-releases/release-3.htm