The National Defense Authorization Act for Fiscal Year 2017 (PL 114-328) establishes a new Cost Accounting Standards Board specific to the Department of Defense. Section 820 of the NDAA adds 10 USC 190 to create a seven-member panel chaired by DoD’s chief financial officer. The duties of the Defense Cost Accounting Standards Board include reviewing DoD’s application of existing cost accounting standards and recommending changes to the CAS Board. The Defense CAS Board has exclusive authority, with respect to DoD, to implement cost accounting standards to achieve uniformity and consistency in the standards governing measurement, assignment, and allocation of costs to contracts with DoD. The Board is also charged to develop standards to ensure that commercial operations performed by DoD employees adhere to cost accounting standards that inform managerial decision making.
The NDAA also amends 41 USC 1501 to specify additional duties for the current CAS Board, which include ensuring that the cost accounting standards used by contractors rely, to the maximum extent practicable, on commercial standards and accounting practices and systems. The Board must also address problems identified by cases presented to the boards of contract appeals and federal courts. In addition, the Board is directed to meet at least once a quarter and annually submit a report to the specified congressional committees describing the actions taken during the prior year to conform the cost accounting standards with generally accepted accounting principles, and to minimize the burden on contractors while protecting the interests of the government. The amendments made by section 820 go into effect on October 1, 2018.