DFARS Business Systems

The U.S. Government has six (6) defined Business Systems:

    • Accounting
    • Estimating
    • Purchasing
    • Government Property
    • Material Management and Accounting System (MMAS)
    • Earned Value Management System (EVMS)

Each business system has defined criteria for what constitutes an acceptable system free of “significant deficiencies”. The U.S. Government echoes throughout its volumes of regulatory literature that:

“Contractor business systems and internal controls are the first line of defense against waste, fraud, and abuse. Weak control systems increase the risk of unallowable and unreasonable costs on Government Contracts.” (Numerous U.S. Government authorities including Revised DFARS Business System Rule July 15, 2014)

The business system requirements are both a pre-requisite to winning a contract and an on-going contract performance metric. The non-compliance with these requirements can:

      • Prohibit entry to the U.S. Government market
      • Prohibit new contract awards
      • Result in contract withholds
      • Result in a competitive disadvantage

The U.S. Government has made it clear, not unlike public companies in a Sarbanes-Oxley (SOX) environment: Internal controls matter and will affect your ability to win and perform under U.S. Government contracts. RKI can perform reviews of your business systems to determine compliance with defined criteria and assist with appropriate remediation plans, as necessary, in managing compliant business systems.