DOD Contractors Must Brace For Audit-Based Withholdings

Law360, New York (March 6, 2012, 5:29 PM EST) -- Contractors must proactively ensure that their business accounting systems meet U.S. Department of Defense standards or potentially face severe cash shortfalls, after the recent finalization of a rule that allows the Pentagon to automatically withhold a contractor's pay if an auditor finds "deficient" business systems, experts say.

Under the rule, finalized Feb. 24, the Defense Contract Audit Agency can recommend withholding payments if the agency finds a significant deficiency in a contractor's business systems, such as accounting, estimating, purchasing, earned value management, material management and property-management...
To view the full article, register now.