This is session 2 of 4 in the Research and Development Deconstructed Series.

Determining the nature and classification of R&D is essential to ascertain the cost accounting and allowability requirements. Understanding whether the R&D effort is a contract or non-contract activity – in other words is it a direct or indirect cost?  Non-contract or indirect activities include: IR&D, B&P, Selling, M&PE, Assets, and other efforts.  We will explore the definitions of direct and indirect cost as it relates to R&D activities, their relationship to the principal purpose for undertaking the effort, identify relevant FAR and CAS and the need for policies and procedures supporting the assessment and monitoring of that determination throughout the life of the effort as it evolves.

Learning Objectives: In this session, participants will become familiar with pertinent FAR Part 2.101 definitions and tackle three of the seven R&D categories including contract/direct R&D, IR&D and B&P efforts and the applicable requirements under FAR Part 31.205-18, CAS 402, and CAS 420. Participants will be able to distinguish between the three categories of R&D, the circumstances associated with each, and the implications for CAS and non-CAS-covered contracts.