{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/912/10/#05-overview-and-background","source":"FASB Accounting Standards Codification, Basic View","usage":"Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective.","topic":"912","topic_title":"Contractors—Federal Government","subtopic":"912-10","subtopic_title":"Overall","section":{"number":"05","label":"05 Overview and Background","anchor":"05-overview-and-background","is_sec":false,"groups":[{"block":null,"heading":null,"paragraphs":[{"citation":"912-10-05-1","para":"05-1","html":"
The Contractors—Federal Government Topic provides incremental guidance for government contractors. See also Subtopic 910-20.
","snippet":"The Contractors—Federal Government Topic provides incremental guidance for government contractors. See also Subtopic 910-20.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:bc9fe78a7abf3255d3b5ab46849228c47b60a2e3351ebaf3dcddf61c3d1d8794","downloaded_from":"2026-09-10T02:10:00.188Z","last_downloaded_at":"2026-09-10T02:10:00.188Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482529","source_sha256":"234f86243a4d1d37fe09fb4bc8ad16d712d7647976d3c0540e6e63fd54572ba2"}},{"citation":"912-10-05-2","para":"05-2","html":"
This Topic includes the following Subtopics:
  1. a
    Overall
  2. b
    Contract Costs
  3. c
    Subparagraph superseded by Accounting Standards Update No. 2014-09.
  4. d
    Income Statement
  5. e
    Subparagraph superseded by Accounting Standards Update No. 2014-09.
  6. f
    Changing Prices
  7. g
    Risks and Uncertainties
  8. h
    Receivables
  9. i
    Inventory
  10. j
    Liabilities
  11. k
    Contingencies
  12. l
    Subparagraph superseded by Accounting Standards Update No. 2014-09.
  13. m
    Cost of Sales and Services
  14. n
    Compensation—Retirement Benefits
  15. o
    Research and Development
  16. p
    Interest.
","snippet":"This Topic includes the following Subtopics:\n(a) Overall\n(b) Contract Costs\n(c) Subparagraph superseded by Accounting Standards Update No. 2014-09.\n(d) Income Statement\n(e) Subparagraph superseded by Accounting Standards…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3ce9f300f53d2696edd4a5e711fe398da63e2207fb10f02de8be8ecf3e072710","downloaded_from":"2026-09-10T02:10:00.188Z","last_downloaded_at":"2026-09-10T02:10:00.188Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482529","source_sha256":"234f86243a4d1d37fe09fb4bc8ad16d712d7647976d3c0540e6e63fd54572ba2"}},{"citation":"912-10-05-3","para":"05-3","html":"
Entities electing to do business with the federal government will find a customer who behaves, in some significant ways, very differently from commercial customers. This unique behavior results from the customer being a sovereign power that conducts its procurement activities under specific laws and implementing regulations. These procurement statutes and regulations govern the process the federal government must follow in its business dealings with private industry. They cover such critical matters as how the federal government selects, monitors, and pays its contractors.
","snippet":"Entities electing to do business with the federal government will find a customer who behaves, in some significant ways, very differently from commercial customers. This unique behavior results from the customer being a …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:db0bc401147fc8ac8042bededa743759007c9c0038100b7706e96e85536a6cb4","downloaded_from":"2026-09-10T02:10:00.188Z","last_downloaded_at":"2026-09-10T02:10:00.188Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482529","source_sha256":"234f86243a4d1d37fe09fb4bc8ad16d712d7647976d3c0540e6e63fd54572ba2"}},{"citation":"912-10-05-4","para":"05-4","html":"
While most industries include entities that are government contractors, certain industries are more heavily involved in providing goods and services to the government. These industries include manufacturing, architect-engineering, professional services, construction, aerospace, shipbuilding, and technology.
","snippet":"While most industries include entities that are government contractors, certain industries are more heavily involved in providing goods and services to the government. These industries include manufacturing, architect-en…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:f928083f93593f44a1afad71ed47c190183c0e108e8d07c1bb2dabb84aac6c8b","downloaded_from":"2026-09-10T02:10:00.188Z","last_downloaded_at":"2026-09-10T02:10:00.188Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482529","source_sha256":"234f86243a4d1d37fe09fb4bc8ad16d712d7647976d3c0540e6e63fd54572ba2"}},{"citation":"912-10-05-5","para":"05-5","html":"
Entities engaged in government contracting are subject to the risks associated with their respective industries, as well as additional risks that generally are not encountered by other business entities in the commercial sector. These additional risks are caused principally by the highly regulated environment in which government contractors operate. Such risks include, but are not necessarily limited to, all of the following:
  1. a
    Contractors are subject to extensive and complex cost accounting and other regulations, and in some circumstances, significant penalties even for violations of relatively immaterial dollar amounts (such as penalties under the False Claims Act).
  2. b
    Business and accounting practices are subject to frequent scrutiny by the government.
  3. c
    The government has unilateral rights not found in commercial relationships.
  4. d
    If contracts or contract changes are negotiated based on cost, cost accounting considerations play a vital role in pricing and administering government contracts and, consequently, determining the contractor's reported financial position and results of operations.
","snippet":"Entities engaged in government contracting are subject to the risks associated with their respective industries, as well as additional risks that generally are not encountered by other business entities in the commercial…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:63b510dbfcfb72427414fe634ba982a991dc7a380f808d124021ad12ca2f600b","downloaded_from":"2026-09-10T02:10:00.188Z","last_downloaded_at":"2026-09-10T02:10:00.188Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482529","source_sha256":"234f86243a4d1d37fe09fb4bc8ad16d712d7647976d3c0540e6e63fd54572ba2"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:cac7ae7a9bb3f944a62685ef02ccd481055a256913dae6c58ceb1cb14eb3353e","downloaded_from":"2026-09-10T02:10:00.188Z","last_downloaded_at":"2026-09-10T02:10:00.188Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482529","source_sha256":"234f86243a4d1d37fe09fb4bc8ad16d712d7647976d3c0540e6e63fd54572ba2"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3e7f23a4ef40074d983c79b9857e8d1f0447c0932d6e6a99a19074a4a556c167","downloaded_from":"2026-09-10T02:10:00.188Z","last_downloaded_at":"2026-09-10T02:10:00.188Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482529","source_sha256":"234f86243a4d1d37fe09fb4bc8ad16d712d7647976d3c0540e6e63fd54572ba2"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:3e7f23a4ef40074d983c79b9857e8d1f0447c0932d6e6a99a19074a4a556c167","downloaded_from":"2026-09-10T02:10:00.188Z","last_downloaded_at":"2026-09-10T02:10:00.188Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147482529","source_sha256":"234f86243a4d1d37fe09fb4bc8ad16d712d7647976d3c0540e6e63fd54572ba2"}}