Category:Cost Accounting Standards (CAS)
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Overview
The Cost Accounting Standards (CAS) consist of 19 separate standards to related to cost accounting and the allocation of costs. The Cost Principles, FAR 31 relate to the cost accounting related to the allowability of costs.
History
In 1968 Congress asked the General Accounting Office (GAO) to study the feasibility of establishing and applying CAS to provide greater uniformity in cost accounting as a basis for negotiating and administering procurement contracts. The GAO concluded it was feasible to apply standards within the government contracting industry. Congress subsequently established the Cost Accounting Standards Board; CAS Board which instituted the Cost Accounting Standards in 1970. The CAS Board was authorized to
- (1) promulgate cost accounting standards designed to achieve uniformity and consistency in the cost accounting principles followed by defense contractors and subcontractors under Federal contracts in excess of $100,000 and
- (2) establish regulations to require defense contractors and subcontractors, as a condition of contracting, to disclose in writing their cost accounting practices, to follow the disclosed practices consistently and to comply with promulgated cost accounting standards.
In 1980 after the standards were implemented, Congress decided to dissolve it, as it had fulfilled its mission. It was re-established in 1988.
CAS were designed to achieve uniformity and consistency in the measurement, assignment, and allocation of costs. CAS is not an onerous set of Government rules, regulations, and requirements, but a framework in government contractors can establish their own flexible methodologies within that framework.
The Office of Management and Budget within the Office of Federal Procurement Policy (OFPP) is where administratively the Cost Accounting Standards Board is functionally located. To learn more about the Board, it's members, to obtain meeting minutes, or Disclosure Forms, visit http://www.whitehouse.gov/omb/procurement_casb
Training
Cost Accounting Standards - Basics
File:Cost Accounting Standards - Basics.pptx
Cost Accounting Standards Summary
| Standard & Title | Modified Only | Purpose |
|---|---|---|
| CAS 401 - Consistency in Estimating, Accumulating, & Reporting Costs | X | The purpose of this Cost Accounting Standard is to ensure that each contractor's practices used in estimating costs for a proposal are consistent with cost accounting practices used in accumulating and reporting costs. |
| CAS 402 - Consistency in Allocating Costs Incurred for the Same Purpose | X | The purpose of this standard is to require that each type of cost is allocated only once and on only one basis to any contract or other cost objective. |
| CAS 403 - Allocation of Home Office Expenses to Segments | The purpose of this Cost Accounting Standard is to establish criteria for allocation of the expenses of a home office to the segments of the organization based on the beneficial or causal relationship between such expenses and the receiving segments. | |
| CAS 404 - Capitalization of Tangible Assets | This Standard requires that, for purposes of cost measurement, contractors establish and adhere to policies with respect to capitalization of tangible assets | |
| CAS 405 - Accounting for Unallowable Costs | X | The purpose of this Cost Accounting Standard is to facilitate the negotiation, audit, administration and settlement of contracts by establishing guidelines covering:
(1) Identification of costs specifically described as unallowable, at the time such costs first become defined or authoritatively designated as unallowable, and (2) The cost accounting treatment to be accorded such identified unallowable costs in order to promote the consistent application of sound cost accounting principles covering all incurred costs. |
| CAS 406 - Cost Accounting Period | X | The purpose of this Cost Accounting Standard is to provide criteria for the selection of the time periods to be used as cost accounting periods for contract cost estimating, accumulating, and reporting. |
| CAS 407 - Use of Standard Costs for Direct Material and Direct Labor | The purpose of this Cost Accounting Standard is to provide criteria under which standard costs may be used for estimating, accumulating, and reporting costs of direct material and direct labor; and to provide criteria relating to the establishment of standards, accumulation of standard costs, and accumulation and disposition of variances from standard costs. | |
| CAS 408 - Accounting for Costs of Compensated Personal Absence | The purpose of this Standard is to improve, and provide uniformity in, the measurement of costs of vacation, sick leave, holiday, and other compensated personal absence for a cost accounting period, and thereby increase the probability that the measured costs are allocated to the proper cost objectives. | |
| CAS 409 - Depreciation of Tangible Capital Assets | This Standard was created to "enhance objectivity and consistency" in allocating depreciation costs to Government contracts. The standard provides criteria for assigning costs of tangible capital assets to cost accounting periods. | |
| CAS 410 - Allocation of BU G&A Expenses to Final Cost Objectives | The purpose of this Cost Accounting Standard is to provide criteria for the allocation of business unit general and administrative (G&A) expenses to business unit final cost objectives based on their beneficial or causal relationship. | |
| CAS 411 - Accounting for Acquisition Costs of Material | The purpose of this Cost Accounting Standard is to provide criteria for the accounting for acquisition costs of material. The Standard includes provisions on the use of inventory costing methods. Consistent application of this Standard will improve the measurement and assignment of costs to cost objectives. | |
| CAS 412 - Composition and Measurement of Pension Costs | The purpose is to provide guidance for determining and measuring the components of pension cost. The Standard establishes the basis on which pension costs shall be assigned to cost accounting periods. The provisions of this Cost Accounting Standard should enhance uniformity and consistency in accounting for pension costs and thereby increase the probability that those costs are properly allocated to cost objectives. | |
| CAS 413 - Adjustment and Allocation of Pension Cost | A purpose of this Standard is to provide guidance for adjusting pension cost by measuring actuarial gains and losses and assigning such gains and losses to cost accounting periods. The Standard also provides the bases on which pension cost shall be allocated to segments of an organization. The provisions of this Cost Accounting Standard should enhance uniformity and consistency in accounting for pension costs. | |
| CAS 414 - Cost of Money as an Element of the Cost of Facilities Capital | The purpose of this Cost Accounting Standard is to establish criteria for the measurement and allocation of the cost of capital committed to facilities as an element of contract cost. Consistent application of these criteria will improve cost measurement by providing for allocation of cost of contractor investment in facilities capital to negotiated contracts. | |
| CAS 415 - Accounting for the Costs of Deferred Compensation | The purpose of this Standard 9904.415 is to provide criteria for the measurement of the cost of deferred compensation and the assignment of such cost to cost accounting periods. The application of these criteria should increase the probability that the cost of deferred compensation is allocated to cost objectives in a uniform and consistent manner. | |
| CAS 416 - Accounting for Insurance Costs | The purpose of this standard is to provide criteria for the measurement of insurance costs, the assignment of such costs to cost accounting periods, and their allocation to cost objectives. The application of these criteria should increase the probability that insurance costs are allocated to cost objectives in a uniform and consistent manner. | |
| CAS 417 - Cost of Money as an Element of the Cost of Capital Assets under Construction | The purpose of this Cost Accounting Standard is to establish criteria for the measurement of the cost of money attributable to capital assets under construction, fabrication, or development as an element of the cost of those assets. Consistent application of these criteria will improve cost measurement by providing for recognition of cost of contractor investment in assets under construction, and will provide greater uniformity in accounting for asset acquisition costs. | |
| CAS 418 - Allocation of Direct and Indirect Costs | The purpose of this Cost Accounting Standard is to provide for consistent determination of direct and indirect costs; to provide criteria for the accumulation of indirect costs, including service center and overhead costs, in indirect cost pools; and, to provide guidance relating to the selection of allocation measures based on the beneficial or causal relationship between an indirect cost pool and cost objectives. | |
| CAS 420 - Accounting for Independent Research & Development and Bid & Proposal Costs | The purpose of this Cost Accounting Standard is to provide criteria for the accumulation of independent research and development costs and bid and proposal costs and for the allocation of such costs to cost objectives based on the beneficial or causal relationship between such costs and cost objectives. |
References and Links
The following link provides a listing of and all relevant sections to the Cost Accounting Standards. http://www.ecfr.gov/cgi-bin/text-idx?SID=1a89b253678ad3fe26a04a21b635caf3&tpl=/ecfrbrowse/Title48/48cfr9904_main_02.tpl
FAR - Appendix Cost Accounting Preambles and Regulations
http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/farapndx1.htm
Subcategories
This category has the following 24 subcategories, out of 24 total.
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C cont. |
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Pages in category "Cost Accounting Standards (CAS)"
The following 27 pages are in this category, out of 27 total.
