Rule changes that affect how small contractors keep their books, in plain English, with the status, the key dates, and the official source for each one.
Not as proposed. The FAR overhaul rule for Part 9 (FAR Case 2026-011) would remove section 9.106, Preaward Surveys, from the FAR text. It keeps the responsibility standard that a contractor have the necessary accounting and operational controls, and it does not eliminate the accounting system review itself. On October 1, 2026, the agencies that issue the FAR asked OMB to extend its approval of the preaward survey forms, the SF-1408 among them. The comment period on the proposed rule closed October 19, 2026 without an extension, and the rule is not in effect.
What it means for your books
The SF-1408 criteria (segregating direct and indirect costs, accumulating costs by contract, timekeeping that supports labor distribution) remain the clearest description of an adequate system.
Who it affects
Contractors pursuing their first cost-reimbursable or T&M contract, including SBIR Phase II companies
Key dates
: Proposed rule published
: SF-1408 and other preaward survey forms sent to OMB for renewal
: Comment period closed, no extension
: Comments to OMB on the preaward survey forms due
It may. FAR Case 2026-006 would trim what clause 52.216-7 requires for an adequate final indirect cost rate proposal: no Form 941 payroll reconciliation schedule, summary-only data for T&M and labor-hour contracts, subcontract detail only above the certified cost or pricing data threshold, and no fee computations for completed contracts. The FAR Council estimates 10 percent less preparation time. The comment period closed October 19, 2026 without an extension; the rule is not in effect until the FAR Council publishes a final version.
What it means for your books
The submission gets shorter; the audit behind it still samples transactions and traces them to timesheets, payroll, and the general ledger.
Who it affects
Contractors with cost-reimbursable or T&M contracts that file an incurred cost submission
On Department of War contracts, yes, for ten requirements. Section 1826 of the FY2026 NDAA exempts nontraditional defense contractors from ten requirements, including the DFARS accounting system clause (252.242-7006) and FAR Part 31, unless the contracting activity applies them in writing. Under 10 U.S.C. 3014, a nontraditional defense contractor is one that has not performed a Department contract or subcontract with full Cost Accounting Standards coverage in the year before the solicitation. Five class deviations implement the law so far, including the one for FAR Part 31; deviations for the other business system clauses are in development.
What it means for your books
Cost-reimbursement contracts still require an accounting system that can segregate and accumulate costs by contract (FAR 16.301-3), contracting officers can still request actual cost data, and civilian agencies are not covered.
Who it affects
Nontraditional defense contractors on Department of War contracts and subcontracts
No. Contracts with small businesses were already exempt from all Cost Accounting Standards, and still are. Since October 1, 2026, negotiated contracts of $35 million or less are exempt (up from $2.5 million), full coverage and the Disclosure Statement start at $100 million (up from $50 million), the $7.5 million trigger contract is gone, and CAS 407 was rescinded.
What it means for your books
CAS was never your layer. FAR Part 31 cost principles and the SF-1408 accounting system review still apply on cost-type work.
Who it affects
Mid-size contractors that have outgrown small business status
For travel from October 1, 2026 through September 30, 2027, the standard CONUS lodging rate is $113 a night (up from $110) and the standard meals and incidentals (M&IE) rate stays at $68. M&IE tiers run from $68 to $92, and 295 non-standard areas have their own, higher rates.
What it means for your books
Travel charged to a cost-type contract is generally allowable only up to the government per diem rates (FAR 31.205-46). Anything above them belongs in an unallowable account.
Who it affects
Any contractor that charges travel to government contracts
No. A September 14, 2026 memo from the Deputy Secretary of War makes audits risk-based: the Department is to consider audited GAAP financial statements before doing more work, not re-audit costs or systems already audited, and not reopen closed years absent indicators of fraud or material misstatement. Most changes depend on criteria and class deviations due within 60 to 90 days, and clauses already in a contract apply until it is modified.
What it means for your books
The memo describes an adequate accounting system as GAAP books plus a contract-level ledger that follows the allowability rules. Cost tracked by contract is still the core.
Who it affects
Defense contractors of every size
Key dates
: Memo signed
: Risk-based audit direction and business system criteria due
: Simplified accounting system criteria and DCAA/DCMA role options due
No. Section 157 of the Continuing Appropriations Act, 2027 (P.L. 119-103), signed September 2, 2026, bars OMB from issuing or finalizing the rewrite of 2 CFR 200 proposed on May 29, 2026 until December 11, 2026. The October 1 target date did not happen, and the current Uniform Guidance still applies.
What it means for your books
Keep following the current 2 CFR 200, including time and effort documentation under 200.430(g), and watch December 11.
