Government Property Management: Why Audit Readiness Starts Long Before a PMSA

Government property management is often viewed as an administrative requirement, but for defense contractors, it is a critical business system that can affect audit outcomes, contract performance, and regulatory compliance.

In a recent webcast hosted by BDO, A2B Tracking, and Deltek, The Why and How of Managing Government Property for the Defense Contractor, presenters discussed evolving government expectations, common compliance challenges, and practical approaches for maintaining audit readiness throughout the property lifecycle. 

The following takeaways summarize the key considerations defense contractors should keep in mind as they evaluate the maturity, scalability, and audit readiness of their government property management practices. 

Government Property Compliance Extends Beyond Recordkeeping

Unlike contractor business systems that focus primarily on financial processes, government property management requires contractors to maintain accurate visibility into government-owned assets across the full property lifecycle, including acquisition, receipt, tracking, use, maintenance, inventory, and disposition.

A compliant property management system depends on more than written procedures. Contractors need documentation, audit trails, and repeatable controls that demonstrate compliance with FAR and DFARS requirements and support effective stewardship of government-owned assets.

Increased Focus on Auditability

Government agencies are placing greater emphasis on property accountability as part of broader efforts to improve audit outcomes and strengthen visibility into government-owned assets managed by contractors.

For contractors, this means property management processes, reporting practices, and recordkeeping controls should be built to withstand ongoing scrutiny, not just periodic review.

Automation Can Reduce Risk and Improve Efficiency

Manual spreadsheets and decentralized tracking methods may be manageable for organizations with limited property holdings. As inventories grow and reporting requirements become more complex, however, those approaches can become difficult to sustain.

Automation, mobile technologies, barcoding, RFID, and system integrations can help contractors improve data accuracy, reduce labor-intensive inventory activities, and maintain stronger visibility into government-owned assets.

Audit Readiness Is an Ongoing Process

Successful audits depend on the systems, records, and controls contractors maintain long before auditors arrive. Regular self-assessments, accurate inventories, subcontractor oversight, and documented timeliness requirements can help organizations identify and address gaps before they result in audit findings.

A proactive approach to property management can reduce compliance risk, support faster responses during audits, and help contractors demonstrate sustained readiness year-round.