Cost Accounting Standards Threshold
$2 million
Also known as: CAS applicability threshold
At a Glance
- Current amount
- $2 million (applicability trigger; tied to the TINA threshold)
- Where it is set
- 48 CFR 9903.201-1, implementing 41 U.S.C. § 1502
- What it requires
- Consistent, disclosed cost-accounting practices under the CAS; full coverage at higher award levels
- Key exemptions
- Small businesses, competitively awarded firm-fixed-price contracts, and commercial-item acquisitions are exempt
- Applies to
- Negotiated contracts over the threshold that are not otherwise exempt
What It Is
The Cost Accounting Standards threshold is the dollar line above which a negotiated contract can become subject to the CAS — a body of rules at 48 CFR Chapter 99 that require contractors to measure, assign, and allocate costs consistently and to disclose their cost-accounting practices to the government. Under 48 CFR 9903.201-1, CAS applicability is triggered at the same dollar level as the certified cost or pricing data (TINA) threshold, currently $2 million. But the CAS is riddled with exemptions that keep most small-business work out of its reach: contracts and subcontracts with small businesses are exempt, as are firm-fixed-price contracts awarded on the basis of adequate price competition without submission of certified cost or pricing data, and acquisitions of commercial products and services. When CAS does apply, coverage comes in two tiers — modified coverage (a subset of the standards) and full coverage (all standards, plus a formal Disclosure Statement), with full coverage triggered when a business receives a single CAS-covered award of $50 million or more, or received a large volume of CAS-covered awards in the prior year. In practice, the CAS is a big-contractor compliance regime, and the small-business exemption is what usually keeps it off an SDVOSB's plate.
What Changes at This Dollar Level
- Above the threshold, a non-exempt negotiated contract becomes subject to the Cost Accounting Standards and their consistency and disclosure requirements.
- Small businesses are exempt from CAS entirely, regardless of contract value.
- Competitively awarded firm-fixed-price contracts and commercial-item acquisitions are also exempt.
- Full CAS coverage (all standards plus a Disclosure Statement) is triggered at much higher award levels — a single award of $50 million or more, or a large prior-year volume.
Key Features
| Feature | What It Means |
|---|---|
| Tied to the TINA threshold | CAS applicability is triggered at the same $2 million level as the certified cost or pricing data requirement — the two thresholds move together. |
| The small-business exemption | Contracts and subcontracts with small businesses are exempt from CAS entirely, which is what keeps most SDVOSBs out of the regime. |
| Competition and commercial exemptions | Competitively awarded firm-fixed-price contracts and commercial-item acquisitions are exempt even above the threshold. |
| Modified vs full coverage | When CAS applies, coverage is modified (a subset of standards) unless full coverage is triggered by a $50 million single award or a large prior-year CAS-covered volume. |
What It Means for an SDVOSB
For a service-disabled veteran-owned small business the Cost Accounting Standards are usually somebody else's problem, because the small-business exemption removes SDVOSBs from CAS coverage no matter how large the award. That exemption is worth protecting: it is one of the concrete compliance advantages of remaining small, and it disappears the moment the firm outgrows its size standard or loses small status through affiliation. The exemption can also matter to how you win work — because CAS compliance is costly, a large prime may prefer to route cost-type work through an exempt small-business subcontractor, and an SDVOSB that stays clearly within its size standard preserves that edge. If your firm is approaching the size line, understand that crossing it can pull you into CAS on your next big negotiated, non-competitive award, which is a real step up in accounting infrastructure.
Watch Out For
- Overlooking that the small-business exemption, not the dollar figure, is what usually keeps an SDVOSB out of CAS — losing small status can pull you in.
- Assuming CAS attaches to every award over $2 million — competitive firm-fixed-price and commercial-item awards are exempt.
- Confusing modified coverage with full coverage — full coverage and a Disclosure Statement are triggered only at much higher award levels.
- Forgetting that affiliation or growth past the size standard can strip the exemption on future awards.
Run the Numbers
Frequently Asked
What is the Cost Accounting Standards threshold?
The CAS threshold is the dollar line — currently $2 million, tied to the certified cost or pricing data (TINA) threshold under 48 CFR 9903.201-1 — above which a negotiated contract can become subject to the Cost Accounting Standards. The CAS require contractors to measure and allocate costs consistently and to disclose their cost-accounting practices. Numerous exemptions apply, including a complete exemption for small businesses.
Are SDVOSBs subject to the Cost Accounting Standards?
Generally no. Contracts and subcontracts with small businesses are exempt from CAS entirely, regardless of dollar value, so a service-disabled veteran-owned small business that qualifies as small under the solicitation's NAICS size standard is not subject to the standards. That exemption is one of the tangible advantages of remaining small — it disappears if the firm outgrows its size standard or loses small status through affiliation.
What is the difference between modified and full CAS coverage?
When CAS applies, modified coverage requires compliance with a subset of the standards, while full coverage requires compliance with all of the standards plus the submission of a formal Disclosure Statement describing the contractor's cost-accounting practices. Full coverage is triggered when a business receives a single CAS-covered award of $50 million or more, or received a large volume of CAS-covered awards in the prior cost accounting period.
Primary Sources
- 48 CFR 9903.201-1 — CAS applicability
- 41 U.S.C. § 1502 — Cost accounting standards
- 48 CFR 9903.201-2 — Types of CAS coverage
Plain-English reference, not legal advice. Acquisition-related dollar thresholds are periodically re-indexed for inflation and the underlying FAR sections and statutes are amended from time to time — always confirm the current figure and its exceptions against the FAR and the actual solicitation before relying on it, and consult qualified counsel for your specific situation.
Change log (1)
- LaunchedPublished the federal procurement dollar thresholds reference covering the dollar lines that shape an SDVOSB set-aside — the micro-purchase threshold (FAR 2.101), the simplified acquisition threshold and the automatic small-business reserve (FAR 2.101 / 19.203), the commercial simplified-procedures ceiling (FAR 13.500), the SDVOSB sole-source ceiling (FAR 19.1406), the subcontracting-plan threshold (FAR 52.219-9), the certified cost or pricing data / TINA threshold (FAR 15.403-4), the Cost Accounting Standards threshold (48 CFR 9903.201-1), the Service Contract Labor Standards (41 U.S.C. § 6702) and Davis-Bacon (40 U.S.C. § 3142) labor thresholds, and the FFATA subaward reporting threshold (FAR 52.204-10) — each with an at-a-glance quick-facts card showing the current dollar amount, a what-changes-at-the-line list, a key-features table, an SDVOSB-specific angle, watch-outs, FAQPage, Article, Dataset, and BreadcrumbList structured data, primary-source citations, and cross-links into the glossary, regulation explainers, clauses, how-to guides, FAQ, and the size-standard, set-aside eligibility, subcontracting, and price-to-win calculators.