Accounting built for government contracting.
Government contractors often need more from their accounting than total revenue and expenses. Waddy helps organize and maintain accounting around contracts, labor, direct and indirect costs, financial reporting, and supporting documentation, so the records better reflect how the business actually operates.
A government contract can change what your accounting needs to show.
Ordinary financial statements do their job well. They report what the company earned, what it spent, and what was left. For many businesses that is the whole picture.
Contracting adds a second dimension. Depending on the contracts and the requirements that apply, the business may also need to see how those same amounts relate to the specific work being performed.
Ordinary statements show
- Total revenue
- Total expenses
- Overall profit
A contracting business may also need
- Where revenue belongs
- Costs by contract or project
- Labor activity
- Direct costs
- Indirect costs
- Information supporting billing
- Documentation behind reported amounts
It is not enough to know what the company earned and spent if you cannot also see how those amounts relate to the contracts the business is performing. That is not a failure of ordinary accounting. It is a different level of structure and documentation that contracting can require.
The accounting should reflect the way the contracting business actually operates.
Every amount has a place it belongs.
Contract accounting is a question of structure. Activity enters the business from several directions, gets classified, and is associated with the work it relates to before it becomes reporting anyone can use.
Labor
Purchases
Expenses
Revenue
Direct Costs
Costs directly associated with the work performed.
Indirect Costs
Costs organized consistently under the accounting structure in use.
Costs associated with the applicable contract or project
Financial reporting and company-level records
Billing
Reporting
Documentation
Review Support
The goal is not simply to record the transaction. It is to know where it belongs.
Accounting maintained around the work you perform.
Government Contractor Accounting & Advisory is a custom ongoing monthly engagement. Scope depends on the contractor, so the engagement may include some or all of the following.
Bookkeeping & Account Reconciliations
Ongoing maintenance of financial activity and applicable account reconciliations.
Contract & Job-Cost Accounting
Organization of applicable revenue and costs by contract, project, or other relevant cost objective.
Labor & Timekeeping Support
Support for maintaining labor and timekeeping information relevant to contract accounting requirements.
Direct & Indirect Cost Organization
Accounting structure that distinguishes applicable direct costs from indirect costs.
Financial Reporting
Financial statements and reporting based on maintained accounting records.
Billing-Support Information
Accounting information organized to support billing and related documentation requirements.
Accounting-Process Review
Review of accounting processes that affect the reliability and organization of government-contracting financial information.
Financial Documentation Support
Preparation and organization of financial information needed for applicable contracting, financial-review, tax, lender, or audit-support purposes.
Company profitability is not the same as contract visibility.
A company-level result tells you how the business performed overall. It does not necessarily tell you what is happening inside the individual contracts that produced it. A few important questions sit underneath that distinction.
Where does the revenue belong?
Accounting should identify applicable contract or project revenue.
Where do the direct costs belong?
Costs directly associated with the work should be organized to the appropriate contract, project, or cost objective.
What belongs in indirect costs?
Indirect expenses should be organized consistently according to the accounting structure being used.
What does the accounting show?
Maintained contract and company records provide a stronger basis for reviewing financial activity and contract performance.
What is still waiting to be collected?
Billing and receivable information can help show what has been invoiced, what remains outstanding, and where payment timing may place pressure on cash needed for payroll, vendors, and other operating costs.
For a government contractor, revenue and cash do not always arrive at the same time. Work may be performed and billed before payment is received, while payroll, subcontractors, vendors, and overhead still have to be funded. Current accounting gives the contractor a better view of that timing and where cash pressure may be developing.
Your accounting should show what is happening inside the contracts, including what has been earned, what has been billed, and what has actually been collected.
Revenue on the books is not the same as cash available to operate the business.
Stop rebuilding the accounting every time documentation is requested.
Government contractors may be asked for financial information for billing, tax preparation, lender requests, proposals, audits, government reviews, or other documentation needs, sometimes on short notice.
When the accounting is maintained around contracts and costs throughout the year, responding is largely a matter of drawing from records that already exist. When it is not, each request turns into a reconstruction project, and the same work gets repeated the next time someone asks.
No accounting process determines what a customer, agency, auditor, lender, or contracting officer will ask for, or removes the possibility of follow-up questions. What it can change is where the answer comes from.
The books should be organized before the question arrives.
Build the accounting with the requirements in mind.
Depending on their contracts and circumstances, government contractors may encounter accounting-system requirements, documentation requests, audits, incurred-cost work, rate support, or other financial reviews. What applies to one contractor may not apply to another.
Waddy may help maintain accounting records with applicable requirements in mind and organize the documentation needed to support review activity when it arises. The goal is for the records and supporting documentation to be better positioned when a review or request occurs.
Support may include
- DCAA-related accounting support
- Accounting structured with applicable requirements in mind
- Accounting system review support
- Preparation for review
- Audit-support documentation
- Organized records for audit activity
Government contractor advisory starts with contractor-specific accounting.
Government Contractor Accounting & Advisory and Proactive Tax Planning & Business Advisory serve different purposes. One is built around the accounting demands of government-contracting work. The other is a separate planning engagement focused on taxes, cash-flow visibility, and broader financial decisions.
Government Contractor Accounting & Advisory
Contracting Accounting
Focuses on the financial structure, records, cost organization, reporting, documentation, and accounting questions that arise from operating a government-contracting business.
Proactive Tax Planning & Business Advisory
A separate engagement
Waddy's separate 12-month planning engagement, focused on tax projections, cash-flow visibility, and broader financial decisions before the money moves.
A contractor may engage either one on its own. Explore Proactive Tax Planning & Business Advisory →
For contractors whose accounting needs to keep pace with the work.
This may be a fit if
- Your business performs government-contract work
- Your accounting needs to track costs by contract or project
- Labor and timekeeping affect your contract accounting
- You need direct and indirect costs organized more consistently
- Financial documentation is repeatedly requested for billing, reviews, lenders, tax work, or audits
- Your current accounting was not designed around your contracting business
- You need an ongoing accounting process rather than periodic reconstruction
- The timing between billing and collection is creating pressure on payroll, vendors, or other operating cash needs
This may not be the right service if
- You do not perform government-contract work
- You only need routine tax return preparation
- You only need general bookkeeping with no contract-specific accounting requirements
- You are seeking a guarantee that an agency will approve your accounting system or audit result
Built around the contracts and accounting your business actually requires.
Custom monthly engagement
Waddy first reviews the current accounting, the company's contract activity, and the level of ongoing support required. The engagement is then scoped around the work the contracting business actually needs.
What determines scope
- 01Contract activity
- 02Accounting complexity
- 03Number of entities
- 04Number of contracts
- 05Transaction volume
- 06Reporting requirements
- 07Scope of support
Your books should support the work you are doing.
If your government-contracting business has outgrown ordinary bookkeeping, the first step is understanding how the accounting is structured today, what your contracts and reporting needs require, and what should change going forward.
Accounting built for government contracting.
Accounting built for government contracting.
Government contractors often need more from their accounting than total revenue and expenses. Waddy helps organize and maintain accounting around contracts, labor, direct and indirect costs, financial reporting, and supporting documentation, so the records better reflect how the business actually operates.
A government contract can change what your accounting needs to show.
Ordinary financial statements do their job well. They report what the company earned, what it spent, and what was left. For many businesses that is the whole picture.
Contracting adds a second dimension. Depending on the contracts and the requirements that apply, the business may also need to see how those same amounts relate to the specific work being performed.
Ordinary statements show
- Total revenue
- Total expenses
- Overall profit
A contracting business may also need
- Where revenue belongs
- Costs by contract or project
- Labor activity
- Direct costs
- Indirect costs
- Information supporting billing
- Documentation behind reported amounts
It is not enough to know what the company earned and spent if you cannot also see how those amounts relate to the contracts the business is performing. That is not a failure of ordinary accounting. It is a different level of structure and documentation that contracting can require.
The accounting should reflect the way the contracting business actually operates.
Every amount has a place it belongs.
Contract accounting is a question of structure. Activity enters the business from several directions, gets classified, and is associated with the work it relates to before it becomes reporting anyone can use.
Labor
Purchases
Expenses
Revenue
Direct Costs
Costs directly associated with the work performed.
Indirect Costs
Costs organized consistently under the accounting structure in use.
Costs associated with the applicable contract or project
Financial reporting and company-level records
Billing
Reporting
Documentation
Review Support
The goal is not simply to record the transaction. It is to know where it belongs.
Accounting maintained around the work you perform.
Government Contractor Accounting & Advisory is a custom ongoing monthly engagement. Scope depends on the contractor, so the engagement may include some or all of the following.
Bookkeeping & Account Reconciliations
Ongoing maintenance of financial activity and applicable account reconciliations.
Contract & Job-Cost Accounting
Organization of applicable revenue and costs by contract, project, or other relevant cost objective.
Labor & Timekeeping Support
Support for maintaining labor and timekeeping information relevant to contract accounting requirements.
Direct & Indirect Cost Organization
Accounting structure that distinguishes applicable direct costs from indirect costs.
Financial Reporting
Financial statements and reporting based on maintained accounting records.
Billing-Support Information
Accounting information organized to support billing and related documentation requirements.
Accounting-Process Review
Review of accounting processes that affect the reliability and organization of government-contracting financial information.
Financial Documentation Support
Preparation and organization of financial information needed for applicable contracting, financial-review, tax, lender, or audit-support purposes.
Company profitability is not the same as contract visibility.
A company-level result tells you how the business performed overall. It does not necessarily tell you what is happening inside the individual contracts that produced it. A few important questions sit underneath that distinction.
Where does the revenue belong?
Accounting should identify applicable contract or project revenue.
Where do the direct costs belong?
Costs directly associated with the work should be organized to the appropriate contract, project, or cost objective.
What belongs in indirect costs?
Indirect expenses should be organized consistently according to the accounting structure being used.
What does the accounting show?
Maintained contract and company records provide a stronger basis for reviewing financial activity and contract performance.
What is still waiting to be collected?
Billing and receivable information can help show what has been invoiced, what remains outstanding, and where payment timing may place pressure on cash needed for payroll, vendors, and other operating costs.
For a government contractor, revenue and cash do not always arrive at the same time. Work may be performed and billed before payment is received, while payroll, subcontractors, vendors, and overhead still have to be funded. Current accounting gives the contractor a better view of that timing and where cash pressure may be developing.
Your accounting should show what is happening inside the contracts, including what has been earned, what has been billed, and what has actually been collected.
Revenue on the books is not the same as cash available to operate the business.
Stop rebuilding the accounting every time documentation is requested.
Government contractors may be asked for financial information for billing, tax preparation, lender requests, proposals, audits, government reviews, or other documentation needs, sometimes on short notice.
When the accounting is maintained around contracts and costs throughout the year, responding is largely a matter of drawing from records that already exist. When it is not, each request turns into a reconstruction project, and the same work gets repeated the next time someone asks.
No accounting process determines what a customer, agency, auditor, lender, or contracting officer will ask for, or removes the possibility of follow-up questions. What it can change is where the answer comes from.
The books should be organized before the question arrives.
Build the accounting with the requirements in mind.
Depending on their contracts and circumstances, government contractors may encounter accounting-system requirements, documentation requests, audits, incurred-cost work, rate support, or other financial reviews. What applies to one contractor may not apply to another.
Waddy may help maintain accounting records with applicable requirements in mind and organize the documentation needed to support review activity when it arises. The goal is for the records and supporting documentation to be better positioned when a review or request occurs.
Support may include
- DCAA-related accounting support
- Accounting structured with applicable requirements in mind
- Accounting system review support
- Preparation for review
- Audit-support documentation
- Organized records for audit activity
Government contractor advisory starts with contractor-specific accounting.
Government Contractor Accounting & Advisory and Proactive Tax Planning & Business Advisory serve different purposes. One is built around the accounting demands of government-contracting work. The other is a separate planning engagement focused on taxes, cash-flow visibility, and broader financial decisions.
Government Contractor Accounting & Advisory
Contracting Accounting
Focuses on the financial structure, records, cost organization, reporting, documentation, and accounting questions that arise from operating a government-contracting business.
Proactive Tax Planning & Business Advisory
A separate engagement
Waddy's separate 12-month planning engagement, focused on tax projections, cash-flow visibility, and broader financial decisions before the money moves.
A contractor may engage either one on its own. Explore Proactive Tax Planning & Business Advisory →
For contractors whose accounting needs to keep pace with the work.
This may be a fit if
- Your business performs government-contract work
- Your accounting needs to track costs by contract or project
- Labor and timekeeping affect your contract accounting
- You need direct and indirect costs organized more consistently
- Financial documentation is repeatedly requested for billing, reviews, lenders, tax work, or audits
- Your current accounting was not designed around your contracting business
- You need an ongoing accounting process rather than periodic reconstruction
- The timing between billing and collection is creating pressure on payroll, vendors, or other operating cash needs
This may not be the right service if
- You do not perform government-contract work
- You only need routine tax return preparation
- You only need general bookkeeping with no contract-specific accounting requirements
- You are seeking a guarantee that an agency will approve your accounting system or audit result
Built around the contracts and accounting your business actually requires.
Custom monthly engagement
Waddy first reviews the current accounting, the company's contract activity, and the level of ongoing support required. The engagement is then scoped around the work the contracting business actually needs.
What determines scope
- 01Contract activity
- 02Accounting complexity
- 03Number of entities
- 04Number of contracts
- 05Transaction volume
- 06Reporting requirements
- 07Scope of support
Your books should support the work you are doing.
If your government-contracting business has outgrown ordinary bookkeeping, the first step is understanding how the accounting is structured today, what your contracts and reporting needs require, and what should change going forward.
Accounting built for government contracting.