CASCost Accounting Standards

Cost Accounting Standards (CAS) are a set of 19 standards and rules promulgated by the Cost Accounting Standards Board (CASB) that govern how contractors must measure, assign, and allocate costs to contracts with the federal government. CAS coverage is triggered when a contractor receives a CAS-covered contract, typically those exceeding certain dollar thresholds. Full CAS coverage requires compliance with all 19 standards, while modified CAS coverage requires compliance with only four standards (CAS 401, 402, 405, and 406). CAS requirements include maintaining consistent cost accounting practices, disclosing cost accounting practices in a Disclosure Statement, and following specific rules for allocating direct and indirect costs. Non-compliance can result in cost disallowances, contract adjustments, and potential False Claims Act liability.