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Unspent Year-End Funds Could Be a Gold Mine for Contractors
Department of Defense agencies have $85 billion in unspent funds that have not been obligated to contracts, and with the federal fiscal year ending on September 30, federal contractors have a lot of opportunities to land new contracts.
Glen Burnie, Maryland (July 20, 2011) Lost in the highly publicized budget and debt ceiling battles on Capitol Hill is a goldmine for federal contractors: federal agencies, especially Department of Defense agencies, have funds which have been allocated but not obligated to contracts, and agencies that want to use those funds in 2012 must sign contracts before the federal fiscal year ends on September 30.
“Because of the budget battles earlier this year and the current debt ceiling debate, federal agencies are sitting on a lot of unspent funds that they want to commit before the fiscal year ends on September 30,” said Veronica Eyenga, president and CEO of VBP OutSourcing, Inc. “A lot of those funds were unspent due to budget uncertainties, so contractors and would-be contractors have a lot of opportunity.”
According to the federal Office of management and Budget, Department of Defense agencies have $85 billion in funds that have not been spent, and not been obligated to any signed contracts, for fiscal year 2011. (Federal fiscal years run from October 1 to September 30, and are numbered by the calendar year in which they end.) Eyenga’s firm, which provides accounting and marketing services to government contractors, is urging companies to aggressively seek out year-end opportunities. “We’re recommending that our clients contact every Contracting Officer and Assistant Contracting Officer they know. Agency personnel want to obligate funds by signing contracts before September 30, which means many contracts will be open for bids in July and August. Even if the work doesn’t begin until after September 30, agencies want to sign contracts before the end of the fiscal year.”
Adding to the urgency, Eyenga noted, “is that next year’s budget, and what funding will be cut, is unusually uncertain. Federal contractors and would-be contractors need to contact agency personnel, monitor contract opportunities and be prepared to move quickly to grab opportunities.”
Part of that preparation, she said, is to have a government cost accounting system already in place that will pass a Defense Contract Audit Agency audit. “Companies new to federal contracting don’t realize that many types of contracts can require a government-compliant accounting system when the contract is awarded. The DCAA can recommend that contracts not be awarded to companies that fail a pre-award audit. A company that says, ‘I’ll worry about my accounting system after I get the contract’ is risking not getting that contract at all.”
Eyenga recommends that companies seek a government cost accounting expert, or even have an outside firm conduct a mock audit, to prepare for landing a federal contract. And then: “Be aggressive this summer. The opportunities are there.”
For more information, visit http://www.vbpoutsourcing.com or call 410-590-5000.
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ABOUT VBP OUTSOURCING
VBP OutSourcing is a Maryland-based, professional accounting and marketing firm servicing the growing needs of DoD federal contractors. Whether you have a need for DCAA government cost accounting solutions via QuickBooks and Peachtree software or you need to strengthen the links between your company's brand and the federal government with a strong capability statement, website or brochure, our professional team is ready to assist. We've been helping government contractors gain more federal business and also meet their DCAA compliance requirements for over 13 years. For more information call 410-590-5000 or visit http://www.vbpoutsourcing.com.
