Not necessarily. As I say to my clients, don’t you want to know the truth? While some solicitations will limit your indirect rates to the safe harbor, other agencies and phases provide more flexibility. Time and time again, awarded underestimate their indirect rates costing profit and precious cash flow. With an adequate accounting system, this exercise is easy. Obviously, the contrary is true. In my more 15 years in this space, indirect rates are rarely on the higher end. For unfunded companies, this is dangerous to the firm’s survival. Your accounting system should position you to recover all of your allowable costs. Simplicity is not in your best interests in this case.
This is myth #16 of our SBIR Accounting Myths blog series. George Moker is a CPA and an entrepreneur who brings a real approach to managing the accounting needs of your firm. George created this series of blog posts to his more than 30 years of small business and startup experience in an attempt challenge the myths about an adequate accounting system and its importance within your organization.
For more information on how we can help with your SBIR accounting needs, please visit us at www.mokercpa.com