Higher Limits Mean Fewer Rules for Small Gov Deals
Published Date: 3/20/2026
Proposed Rule
Summary
The government wants to raise the money limits that decide which companies must follow special cost rules when working on federal contracts. This change mainly affects businesses dealing with big government projects, making it easier for smaller contracts to skip some paperwork. If you have thoughts, you’ve got until April 20, 2026, to speak up!
Analyzed Economic Effects
5 provisions identified: 4 benefits, 1 costs, 0 mixed.
Full CAS Threshold Raised to $100M
The rule would raise the regulatory thresholds for full Cost Accounting Standards (CAS) coverage and disclosure statements from $50 million to $100 million. The Board estimates the change would reduce entities subject to full coverage from 773 to 564 while maintaining $1.21 trillion of the dollars currently covered.
Basic CAS Applicability Raised to $35M
The proposal would change the basic statutory CAS applicability threshold from $2.5 million (with a $7.5 million trigger) to a single stated dollar threshold of $35 million and eliminate the $7.5 million trigger contract concept. The Board and OMB estimate this change would reduce CAS-covered business segments by about 60% while retaining over 90% of dollars currently subject to CAS coverage.
Waiver Authority Raised to $100M
The proposed rule raises executive agency head authority to waive CAS from $15 million to $100 million, allowing agency heads to grant CAS waivers for contracts up to $100 million without Board approval. This implements changes made to 41 U.S.C. 1502(b)(3).
CAS Rules Clarified for IDCs
The rule clarifies how CAS exemptions apply to indefinite delivery contracts (IDCs): for multiple-award IDCs, CAS applicability is determined at the individual task or delivery order level using that order's base and all options; for single-award IDCs, applicability is determined at the time of award using the IDC's base and all options (ceiling).
Removal of Small-Segment Disclosure Exemption
The Board proposes eliminating the exemption that allowed a segment not to submit a Disclosure Statement if, during the most recently completed cost accounting period, the segment's CAS-covered awards were less than $10 million and less than 30% of segment sales. The Board says this exemption is no longer necessary given the higher thresholds.
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Key Dates
Department and Agencies
Related Federal Register Documents
2026-05512 — Conformance of Cost Accounting Standards to Generally Accepted Accounting Principles for CAS 407 Use of Standard Costs for Direct Material and Direct Labor
The government wants to update rules about how companies use standard costs for materials and labor to match regular accounting rules (GAAP). This affects businesses that work with federal contracts and could change how they report costs. Comments on these changes are open until April 20, 2026, so get ready to share your thoughts!
2026-05513 — Cost Accounting Standards Board Meeting Agenda
The Cost Accounting Standards Board is working hard to update and simplify the rules that companies follow when charging the government. They’re planning to remove some old rules, adjust money thresholds for when rules apply, and align standards with regular accounting practices. These changes aim to cut red tape and save time and money for businesses working on government contracts, with key meetings happening through early 2026.
2026-04912 — Federal Acquisition Regulation: Trade Agreements Thresholds
Starting March 13, 2026, new dollar limits kick in for government contracts under trade agreements like the WTO and various Free Trade Agreements. If you’re a business working with the government, these updated thresholds tell you when certain trade rules apply, often meaning bigger contracts get special treatment. This change helps keep government buying fair and up-to-date with global trade rules.
2026-04911 — Federal Acquisition Regulation; Federal Acquisition Circular 2026-01; Introduction
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2026-04913 — Federal Acquisition Regulation; Federal Acquisition Circular 2026-01; Small Entity Compliance Guide
Starting March 13, 2026, small businesses working with the government will see updated dollar limits for trade agreements. These changes affect when certain international trade rules kick in, making it easier to know when they apply. If you’re a small contractor, this update helps you understand new spending thresholds and plan your bids better—no surprises, just clearer rules!
2026-03910 — Submission for OMB Review; Examination of Records by Comptroller General and Contract Audit
Contractors working with the government need to keep their records open for audits by the Comptroller General and contract auditors. The government is asking to extend the current rules that make sure these records stay available for review, with no big changes or extra costs. If you’re involved, you’ve got until March 30, 2026, to share your thoughts on this extension.
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The government wants to update rules about how companies use standard costs for materials and labor to match regular accounting rules (GAAP). This affects businesses that work with federal contracts and could change how they report costs. Comments on these changes are open until April 20, 2026, so get ready to share your thoughts!
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