Material Management and Accounting System Compliance: A Strategic Imperative for Government
Contractors
In the space of government contracting, particularly in the aerospace and defense (A&D) industry,
compliance is inseparable from competitiveness. Contractors are not only required to deliver on cost,
schedule, and performance; they must also operate under a web of oversight designed to ensure efficiency
and accountability. One of the most critical oversight mechanisms is the Material Management and
Accounting System (MMAS), governed by the Defense Contract Management Agency (DCMA).
Failure to comply with MMAS standards can result in payment withholds, audit findings, or even lead to
the termination of a contract. However, contractors who excel at MMAS compliance stand out as reliable
partners in the eyes of the federal government and other potential clients.
What is MMAS Compliance?
MMAS is a set of criteria DCMA auditors use to determine whether a contractor’s material management
and accounting practices are sufficient. These criteria ensure contractors buy the right materials, in the
right quantities, charge them to the right projects, and provide full traceability along the way.
At its core, MMAS compliance is about discipline:
● Validating needs: Contractors must align purchases with approved bills of material (BOMs).
● Avoiding excess: Overbuying or holding unnecessary inventory is discouraged.
● Maintaining accuracy: Costs must be charged to the correct contract and reconciled regularly.
● Enabling traceability: Records must clearly show the flow of materials from procurement to
usage.
The goal is straightforward: to ensure accountability for government funds and prevent fraud, waste, and
abuse.
The Challenges of MMAS
Contractors often struggle with MMAS because it touches so many parts of the business, i.e.,
procurement, production, inventory, and accounting. When these processes are managed in silos or spread
across multiple systems, it becomes difficult to demonstrate compliance. Some of the most common
challenges include:
● Inconsistent data between procurement and accounting systems
● Difficulty reconciling material costs across multiple contracts
● Limited visibility into inventory levels and usage
● Manual processes that create errors or gaps in audit trails
These pain points not only increase the risk of noncompliance but also drain valuable time and resources
that could otherwise be spent on program execution.
Deltek Costpoint: Embedding Compliance into Operations
This is where Deltek Costpoint shines as a facilitator of material management. Costpoint was
purpose-built for government contractors, and its integrated design makes it uniquely suited to address the
full scope of MMAS requirements. Rather than layering compliance checks on top of operations,
Costpoint embeds them into daily workflows.
Here are a few ways Costpoint supports MMAS compliance:
● End-to-End Integration: Costpoint connects procurement, inventory, production, and accounting
in one system, ensuring materials are tracked from requisition to final use. This eliminates data
silos and supports accurate cost allocation.
● Automated Controls and Validations: Built-in rules prevent overbuying, validate requirements
against BOMs, and flag discrepancies early. These proactive controls reduce the chance of
compliance issues during audits.
● Audit-Ready Visibility: Costpoint provides detailed reporting and audit trails, so contractors can
quickly demonstrate how materials were planned, acquired, and consumed. This transparency
reduces the stress of DCMA reviews.
● Scalability for Growth: Whether managing a handful of contracts or a complex global supply
chain, Costpoint scales with the business. Its modular architecture supports evolving compliance
needs without disrupting operations.
● Link to Broader Compliance: Costpoint’s MMAS functionality doesn’t exist in a vacuum; it ties
into broader FAR and CAS compliance requirements, ensuring contractors maintain a holistic
compliance posture.
Beyond Compliance: Building Competitive Advantage
While MMAS compliance is required, contractors can use it as a differentiator. A strong MMAS
demonstrates control, efficiency, and reliability, i.e., all qualities the federal government and other
contractors value in a partner. By adopting Deltek Costpoint, contractors not only mitigate audit risk; they
enhance operational efficiency and strengthen their reputation in the marketplace.
In today’s environment of supply chain disruption and increased oversight, having a reputation that
reflects efficiency and risk mitigation is valued now more than ever. Contractors who can show DCMA
auditors that their systems are robust and well-integrated are also proving to program managers and
contracting officers that they are low-risk, dependable suppliers.
Conclusion
MMAS compliance may sound like a regulatory burden, but with the right systems, it becomes a natural
extension of good business practice. Deltek Costpoint allows government contractors to integrate
compliance into everyday operations, reducing risk while improving efficiency and visibility.
For contractors in aerospace and defense, this isn’t just about checking a regulatory box. It’s about
building the kind of disciplined and transparent business that facilitates efficient operation that wins trust
and wins contracts.
