The determination as to whether a Government contract is CAS-covered (Cost Accounting Standards) is pretty straight-forward. Today we will take a brief look at the requirements for the various levels of CAS coverage.
The first level is full exemption. Small businesses are exempt from CAS. So are negotiated contracts under $650 thousand and negotiated contracts under $7.5 million if the contractor is not performing any other CAS-covered contracts. Contract awards based on adequate price competition, commercial prices, or prices set by law or regulation are also exempt. There are a few other obscure exemptions available.
If a contract does not meet one of the foregoing exemptions, the next determination is whether CAS coverage is full-or modified. The threshold here is $50 million. Contracts in excess of $50 million are automatically covered. Additionally, contracts under $50 million (but more than $650 thousand) are fully covered if, the contractor, in its preceding fiscal year, received more than $50 million in CAS covered awards.
Under modified coverage, contractors are subject to CAS 401, 402, 405, and 406. Under full coverage, contractors are subject to all 19 CAS standards. That was..