The Federal Fiscal Year-End Is Approaching- Key Considerations for Government Contractors

The useful part

As September 30 approaches, government contractors enter one of the busiest periods of the federal procurement calendar. For contractors, however, fiscal year-end is more than a period of increased procurement activity. It is also a useful time to review contract funding, invoicing, performance, compliance, bid protest considerations, and closeout issues.

How it works

• Contractors also should account for the funding environment immediately following fiscal year-end.
• Contractors that take a proactive approach can reduce the risk of missed deadlines, funding disruptions, billing problems, and disputes.
• For FY 2027, the federal government will begin the new fiscal year operating under a continuing resolution through December 11, 2026.
• Review Contract Funding Contractors should begin by reviewing the funding status of their active contracts and task or delivery orders, particularly those that are incrementally funded or supported by...
• The amount currently obligated may not be sufficient to cover anticipated performance through the end of the period of performance.

What to take from it

Regulation (FAR) contains several provisions governing the funding of federal contracts, including incrementally funded contracts and contracts subject to limitations on cost or funds. Contractors should review the funding provisions and clauses applicable to each contract and determine whether additional funding or a contract modification is necessary.

Details worth keeping

The end of the government's fiscal year often brings a surge in contracting activity, including new awards, extensions, funding actions, modifications, and efforts to complete performance before appropriated funds expire or become subject to additional limitations.