To assist emerging government contractors with the Incurred Cost Submission (“ICS”) process we have compiled responses to a few of the questions we are commonly asked. Listed below are these questions and responses. If you need further assistance or have additional questions with the ICS process, contact us at Our professionals have extensive experience with developing indirect cost rates and assisting contractors with ICS preparation.

What is an incurred cost submission?

An Incurred Cost Submission (“ICS”) contains actual cost and billing information provided by the contractor to the Contracting Officer for the purpose of proposing final indirect cost rates and eventually adjusting billings. Submission of the ICS is how contractors begin the process to “true up” billings, adjusting from provisional to actual indirect cost for a particular fiscal year. Both cost reimbursement and time & materials (T&M) contracts use estimated cost based or operating plans/budgets to calculate provisional indirect rates for use in billings to the government. Once the final indirect cost rates are established by the Contracting Officer, the contractor uses the final rates to submit revised “true up” billings, reimbursing the government if provisional rates were too high in comparison to the actual rates, or requesting additional payment if provisional rates were too low.

Who is required to submit an incurred cost submission?

Many contractors wonder “is my company required to file an incurred cost submission?” Contractors that hold a cost reimbursement or T&M contract containing the Allowable Cost and Payments clause are required to submit an ICS. Under FAR 16.307 cost reimbursement and T&M contracts are required to include the clause FAR 52.216-7 Allowable Cost and Payment. This clause explains that any business unit of a federal contractor that holds cost-type or time and materials contracts, regardless of agency, must submit an ICS for each fiscal year to establish final indirect cost rates and to validate billings to reflect the final settled rates.

When is an incurred cost submission due to the government?

ICSs are due six months after completion of the contractor’s fiscal year end. This is in accordance with the Allowable Cost and Payment Clause. Reasonable extensions to the due dates for exceptional circumstances may be requested in writing to the Contracting Officer.

Who/where do you submit an incurred cost submission to?

Contractors are required to submit their completed ICS to the appropriate Government Administrative Contracting Officer (GACO) assigned to their largest negotiated contract, or the cognizant Federal agency official and the contractor’s cognizant audit office.

Large contractors or DoD contractors typically are assigned an Administrative Contracting Officer (ACO) and a cognizant audit agency.

For contractors without an assigned audit agency, there is a general submission box for whatever branch the contractor is assigned that can be found on the DCAA’s website.

The DCAA is now providing contractors a new method called The Contractor Submission Portal (CSP) to submit their ICS through the Procurement Integrated Enterprise Environment (PIEE) website. The CSP allows contractors to submit their ICS, update, or withdraw previous submissions all in one location. This is not a mandatory way to submit your ICS, however, use of the CSP is encouraged by the DCAA.

When an ICS is deemed adequate are the final indirect cost rates approved/established?

No, an adequacy determination means that the submission has been assessed for completeness and accuracy, and determined adequate for purposes of performing an audit. Once the submission is deemed adequate, the audit will be performed.