Benefits

Know where your property system stands

Manage and maintain government property with a clear understanding of how your current infrastructure aligns with the 10 expected outcomes for compliant stewardship.

  • Gap analysis

Protect what you’re entrusted with

Implement the systems, controls, and processes required to store, track, and safeguard government property — proving accountability at every step.

  • Property tool selection
  • Property tool implementation
  • Property system manual
  • Measurement plan

Transform property review preparation

Streamline your review with third-party surveillance, self-assessments, and mock reviews that validate process adherence, enables continuous compliance, and corrects issues ahead of government findings.

  • Mock reviews
  • Third party surveillance
  • Real-time DCMA liaison

Related
success stories

Take a deeper dive and discover how we’ve helped clients with Property System Compliance.

FAQs

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What are our core obligations when our company holds or uses government property?

Contractors entrusted with government property are subject to the property management requirements established under FAR Part 45 and the associated clause at FAR 52.245-1. Contractors are required to comply with the ten government property outcomes: acquisition, receipt, records, maintenance, physical inventory, subcontractor control, utilization, reporting, disposition, and closeout. For contractors subject to DFARS, additional requirements apply under DFARS 252.245-7003 and related clauses. The government retains title to all government-furnished property (GFP) provided to a contractor and contractor-acquired property (CAP) purchased with contract funds. Failure to demonstrate accountability for each outcome creates liability exposure, system disapproval and potential contract termination risk.

How do we know whether our current property practices meet government expectations?

The starting point is an independent gap analysis measured against the ten outcomes defined in FAR 52.245-1. Additional guidance can be found in DCMA’s Property Guidebook which defines 22 Property Management System Analysis (PMSA) criteria. Many contractors discover that informal practices, spreadsheet-based tracking, or undocumented procedures create material gaps relative to these criteria. A structured gap analysis produces a clear picture of your current state versus the required standard, prioritizes remediation by risk, and establishes a defensible baseline before any formal government review is initiated. Finally, this independent assessment can identify gaps which can be corrected via a corrective action plan prior to the government’s review.

What does a compliant property management system actually require in practice?

A compliant property management system requires more than a tracking tool. Robust business systems include documented policies and procedures governing each lifecycle phase, a written property system manual that reflects actual practice, reasonable timeframes for execution, selection and implementation of a property management tool appropriate to your asset volume and contract mix, and a self-assessment plan that demonstrates ongoing system monitoring. Under FAR 45.105, contractors are responsible for establishing and maintaining an approved property system, and DCMA evaluates whether written procedures are actually followed, not just whether they exist. The gap between documented intent and operational practice is among the most common findings in a formal property system review. Organized record retention of required documentation is a key factor for success.

What triggers a government property system review, and how should we prepare?

Typically, DCMA conducts PMSA reviews as part of its standard contractor oversight mission, typically triggered by contract award thresholds, prior findings, or routine surveillance cycles. The DCAA has recently started property audits as well. A formal review or audit evaluates whether your property system is adequate or inadequate across all ten regulatory outcomes. An inadequate determination can result in disapproval of your property system, increased government oversight, and limitations on your ability to maintain government property. Preparation through mock reviews, documented corrective action histories, and third-party surveillance of day-to-day process adherence gives your team the consistency and confidence required to perform under live review conditions.

How does property system compliance affect our accounting practices and cost recovery?

Government property has direct accounting implications that extend beyond physical stewardship. Depreciation, capitalization thresholds, and the treatment of contractor-acquired property must be reflected accurately in your accounting system and align with your disclosed accounting practices where applicable. Costs associated with property management, including maintenance, insurance, and disposition, are subject to FAR Part 31 allowability standards. When your property records and accounting records are misaligned, the result is either unsupported cost claims or missed recovery. Reconciling these two systems is a foundational step in building a property compliance posture that survives both a DCMA property review and a DCAA cost audit.

What is at stake if our property system is found to be noncompliant?

A formal property system disapproval by DCMA carries consequences that extend well beyond the immediate review. Contractors with a disapproved system face increased surveillance, potential withholding of contract payments under DFARS 252.242-7005, and reputational risk with contracting officers evaluating responsibility for future awards. In cases involving lost, damaged, or destroyed government property, contractors may face financial liability under FAR 45.104 if proper care cannot be demonstrated. For contractors pursuing growth through research, development, or production contracts, an unresolved property system deficiency creates a direct obstacle to accessing the government-furnished assets that fund that work.

Protect assets, preserve innovation

Build a compliant property system that protects government assets, demonstrates accountability, and keeps you eligible for future funding.

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