Government contractors (GovCons) sell to some of the largest customers in the world, federal, state and local governments.  Federal contractors have the same financial, compliance and tax requirements as commercial focused organizations plus they have stricter regulatory requirements imposed by the federal government like FAR, DFARS, and CMMC.  ROSE specializes in helping all types of GovCons meet complex compliance standards. Note: Many of these standards are actually best practices for all companies.  ROSE's supports for commercial focused businesses exposed them to many of these best practices.

Startup and early stage GovCons should engage ROSE as early as possible. ROSE offers affordable start-up solutions through its ROSE Community and bookkeeping packages, giving startups access to critcal expert GovCon financial advice early on. Setting up a strong financial foundation that supports GovCon compliance standards will reduce compliance costs, increase your confidence in proposing on cost-plus contract types, and improve the likelihood that you will win future government contracts.

To ensure DCAA and GovCon compliance, businesses must properly configure their chart of accounts, implement compliant and accurate timekeeping, maintain proper cost allocations, establish strong internal controls, and be prepared for regulatory audits. As GovCons grow, many of the contracts they propose on will require a DCAA approved accounting system or a Letter of Adequacy from an independent accounting firm.   Maintaining an adequate accounting system and having it certified before the contract requirement is discovered is a best practice. 

Fractional GovCon CFOs support the growth of government contractors by providing standard financial guidance plus critical GovCon knowledge on a part-time basis. They ensure your accounting system is adequate and audit ready, they calculate and monitor indirect rates, support cost volumes for proposals, ensure proposals meet profitability targets, ensure accurate cost allocation to each contract, provide insights into managing larger contracts, and handle complex compliance requirements including audit support and incurred cost submissions.

During a pre-award survey or Letter of Adequacy Review, expect the auditor to evaluate your accounting system for compliance with government regulations. The first request from the auditors will generally be for a copy of your accounting policies and procedures. They will review areas like timekeeping, cost allocation, and internal controls to ensure your system can handle contract requirements. Proper documentation and readiness are key to ensuring a smooth audit process and a system approval. 

To structure indirect rates and allocate costs effectively, you should categorize expenses into direct and indirect costs. Establish key indirect cost pools (e.g., overhead, fringe, general and administrative) and allocate costs to contracts based on logical and acceptable cost drivers, like labor dollars or total direct contract costs. It's essential to ensure that your cost structure complies with relevant regulations and best practices to make it easy for DCAA auditors to understand your system and to ensure your indirect rates are market competitive. 

ROSE helps government contractors ensure accurate timekeeping and labor distribution through specialized systems designed for compliance with contract requirements, such as DCAA regulations. By using advanced financial tools, ROSE ensures that labor is allocated correctly and recorded compliantly, minimizing errors in reporting and billing. This level of precision helps contractors meet strict government standards, ensuring accurate and timely billing practices, while supporting adherence to project budgets and timelines.

Finance as a Service (FaaS) helps improve cash flow management for government contractors by ensuring accurate and timely billing, proper use of federal portals, and strict adherence to contract billing terms. Accurate invoicing reduces errors, preventing payment delays from the federal government. FaaS also supports the proper use of payment portals, ensuring timely and accurate submission of invoices and supporting documents. This streamlined process minimizes delays and ensures faster payment processing, leading to better cash flow management. 

Government contractors (GovCons) should track key financial metrics like indirect rates, timekeeping compliance, cost drivers, DSO (days sales outstancing), and project profitability to ensure compliance with DCAA and FAR regulations. Monitoring these metrics helps maintain accurate billing, meet government contract requirements, and manage costs efficiently. Proper tracking supports compliance, minimizes the risk of lower performance marks, and enhances long-term financial stability.

Finance as a Service (FaaS) helps manage multiple contracts and projects by providing scalable financial systems and expert support. It centralizes financial data, streamlines processes such as timekeeping, cost allocation, and reporting, and ensures DCAA compliance for government contracts. FaaS also offers financial insights across projects, helping businesses track profitability, cash flow, and budget overruns. This allows for better decision-making, improved resource allocation, and efficient management of complex financial operations.  FaaS enables companies to grow into larger contracts that may include cost-type contracts. 

Finance as a Service (FaaS) supports the financial aspects of proposal and bid management by reviewing and assisting in pricing proposals, including the review of the cost volume. Rose Financial Solutions ensures that the financial components of a government contract bid are reasonable and match the cost tracking and allocation methods. By leveraging ROSE’s expertise, businesses can confidently submit proposals that meet government requirements while minimizing financial errors.

Yes, Finance as a Service (FaaS) can help you meet cybersecurity requirements like CMMC certification. Rose Financial Solutions ensures your ROSE hosted accounting system complies with Level One CMMC standards, providing secure and compliant financial systems for government contractors. With ROSE, you don’t have to worry about meeting cybersecurity regulations for financial systems—our systems are designed to protect your data and maintain compliance. 

A disciplined back office for a GovCon ensures compliance with DCAA regulations while maintaining financial accuracy and efficiency. It includes a compliant timekeeping systems, proper cost allocations, and strong internal controls for accounting and reporting. A disciplined back office also includes regular audits or reviews, automated financial processes, and detailed project tracking to meet contract requirements. With a well-organized system, businesses can handle multiple contracts, meet government standards, and ensure accurate billing and financial transparency for both stakeholders and auditors.

Strengthening project controls means implementing systems to monitor timekeeping, cost tracking, budgeting, and compliance with DCAA and FAR regulations. For government contractors (GovCons), this ensures projects stay on budget, on time, and meet compliance requirements. Enhanced controls will improve cost allocation accuracy, improve resource management, and minimize audit risks and delays. By improving project execution and financial oversight, GovCons can reduce risks, avoid cost overruns, and maintain compliance, ultimately increasing their ability to win and successfully manage government contracts. 

ROSE helps government contractors ensure accurate and timely timekeeping and labor distribution through specialized systems designed for compliance with contract requirements, such as DCAA monitored regulations. By using best practices, ROSE ensures that labor is tracked and allocated correctly, preventing errors in reporting and billing. This level of support helps contractors meet strict government standards, ensuring accurate documentation and billing practices, while supporting adherence to project budgets and timelines.