CASB seeks to obtain general comments to eliminate some criteria

The Cost Accounting Standards Council (CASB) issued an advanced notice on setting the proposed rules, and called on public comments on the proposed judiciary for cost accounting standards, CAS 404 and CAS 411.

This step is part of CASB efforts to coordinate government cost accounting standards with generally accepted accounting principles (GAAP), according to the National Defense Licensing Law for the 2017 fiscal year.

CASB has noticed that since the introduction of CAS 404 and CAS 411, GAAP has been subjected to reviews, leaving the minimum difference between these standards and GAP.

The Board of Directors proposes to eliminate both criteria, with the exception of some of the provisions mentioned in CAS 404-50 (D) (1) related to business groups, which is proposed to be transferred to CAS 418-50.

For contractors with CAS -covered contracts, the proposed changes mean that the concrete capital assets must remain from a company obtained in the net of the seller’s book value if the costs are incurred on government contracts in the last accounting period before the business group.

The minimum cost of the acquisition, which was previously identified, will be removed at $ 5,000 under CAS 404.

CAS 411 set two averages acceptable to assess inventory – “average costly cost” and “moving average”.

Although GAAP widely indicates the average cost methods, CASB is expected to continue to use one of the specified methods, as a third fixed method has not been widely identified.

GAAP does not require written data for accounting policies and practices, unlike CAS 404 and CAS 411.

However, CASB expects that contractors will continue to develop and maintain accounting accounting policies to meet other requirements, such as CAS detection data.

The current notification follows many measures taken by CASB in June 2024.

These procedures, along with general comments, are said to have shed light on CAS’s priorities

The proposed reviews of CAS 403, CAS 414 and CAS 417 aim to resolve conflicts between CAS and GAAP with regard to operating revenues and rental accounting.

In addition, CASB suggested removal of CAS 408 and CAS 409 requirements that are repeated with GAAP.

This is followed by industrial reactions that support the elimination of CAS 408, while opinions varied on the fate of CAS 409.

Finally, CASB has requested general notes on the capacity of the CAS application on unlimited delivery compounds, providing six possible options to determine when and how CAS should apply to IDV contracts, and seek to clarify the current ambiguity.

“CASB seeks general comments on eliminating some criteria” originally created and published by AccountantThe brand owned by Globaldata.

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