Engineering Firms

Under ASC 606, revenue is recognized based on progress toward satisfying performance obligations, typically measured by costs incurred relative to total estimated costs, or by milestone achievement. This requires accurate cost tracking, regular estimate-to-complete updates, and proper treatment of contract modifications. SMAART implements robust WIP reporting systems that give firm leadership real-time visibility into project profitability.

Yes. Engineering firms frequently qualify for R&D tax credits for activities including developing new structural systems, creating innovative design solutions, performing advanced analysis and simulation, testing new materials or construction methods, and developing proprietary software tools. SMAART performs comprehensive R&D studies to identify all qualifying activities.

FAR overhead rates are required for engineering firms that perform government contracts. They allocate indirect costs to direct project work using approved rate structures. DCAA-compliant overhead rates are audited by the Defense Contract Audit Agency for defense contracts. SMAART develops, documents, and maintains FAR-compliant overhead rates for engineering firms with government contract work.

Successful engineering firm succession requires careful planning around firm valuation, ownership transfer structure, financing arrangements for incoming principals, and tax-efficient transition mechanisms. SMAART provides firm valuations, models various transition scenarios, and helps design buy-in arrangements that are fair to all parties and executable without disrupting firm operations.