Two threshold changes in the FY2026 National Defense Authorization Act will free a meaningful slice of mid-sized federal contractors from CAS-coverage and certified cost-or-pricing-data burdens that have shaped their cost-accounting infrastructure for years. The DFARS must be updated to reflect the changes within 120 days of enactment — by April 17, 2026. Coverage of the changes from Government Contracts Law and BDO.
| Threshold | Old | New (FY26 NDAA) | Effective |
|---|---|---|---|
| CAS full-coverage threshold | $50 million | $100 million | DFARS update by Apr 17, 2026 |
| Certified cost or pricing data | $2.5 million | $10 million | Defense contracts after Jun 30, 2026 |
Change 1: CAS full-coverage threshold doubles
The threshold for full Cost Accounting Standards coverage rises from $50 million to $100 million in awarded contract value, subject to inflation adjustments. Firms holding contracts between $50M and $100M that were previously under full CAS coverage may now qualify for modified coverage instead.
Practical impact: full CAS coverage requires compliance with all 19 standards. Modified coverage requires compliance with only four (CAS 401, 402, 405, 406). For a mid-sized firm with $80M in qualifying federal work, this could mean retiring 15 cost-accounting practices and the audit infrastructure that supports them.
Change 2: Certified cost-or-pricing data threshold quadruples
The threshold for required disclosure of certified cost or pricing data rises from $2.5 million to $10 million for defense contracts entered into after June 30, 2026. Below $10M, contractors are no longer required to submit FAR Table 15-2 cost data.
Per BDO's analysis, this should accelerate award timelines on mid-sized contracts and reduce the documentation burden on the bid side.
The catch
Two complications worth flagging:
- The DFARS update timeline is tight. Until DFARS is amended to reflect the NDAA changes, contracting officers may continue to apply the old thresholds out of caution. Firms benefiting from the changes should verify in writing with each CO before reducing accounting practices.
- Modified-coverage firms still face audits. The audit scope shrinks, but DCAA's audit interest in indirect-cost rates does not. Don't read this as a license to relax internal controls.
What to do this week
- Pull a list of every active contract above $50M and check whether you qualify for the modified-coverage shift.
- For the certified cost-or-pricing-data change, brief your capture team — bids in the $5–10M range can now skip Table 15-2 and move faster.
- If you're at the $90–110M ceiling, talk to your accountant about whether spinning up a CAS-modified accounting practice this quarter saves you full-coverage costs in FY27.