Right now, you decide what the government sees. And that's exactly what's on the table.
Pull up your last proposal. Could you walk someone through every number in it, right now, without reconstructing anything first?
For most pricing teams, the honest answer is complicated. A rate structure nobody can trace back to how it was built. A basis of estimate (BOE) that lives mostly in one estimator's head. Three "final" versions of the same pricing spreadsheet floating around before submission. A subcontractor's number that got rolled into the prime's bid without anyone checking it twice.
None of that is unusual. Most of it has never been a problem, because an audit or a cost review has always been an event you could see coming. Someone requests the file, you pull it together, you walk them through it. There's a window to prepare.
That window is what the Department of War's (DoW) latest cost and pricing memo potentially takes aim at.
What Actually Changed
Signed by the Deputy Secretary of War Steve Feinberg on August 18, 2026, the memo resets the department's expectations regarding supplier cost and pricing data.
- Full transparency, every tier. The requirement applies to negotiations for products and services at $10 million or more, across contractors and subcontractors alike, regardless of whether certified cost and pricing data is required, a broader bar than certification alone used to set. Commercial off-the-shelf items are excepted.
- Margins get benchmarked. The Under Secretary of War for Acquisition and Sustainment is directed to set fair and reasonable profit margins using commercial best practices, tailored by product or service line.
- CSDR catch-up, on a real clock. Delinquent Cost and Software Data Reporting submissions are due within 30 days of the memo, by September 17, 2026. That data now feeds how the department assesses sole-source contract quality going forward. Where CSDR data isn't in play, the Defense Contract Audit Agency (DCAA) compares actual costs to prices paid instead.
- A more direct line to your data. The department wants to explore pulling cost information directly from contractors' Enterprise Resource Planning (ERP) or financial systems through an automated, Application Programming Interface based connection, instead of waiting for a submission. It's unfunded and undesigned today, but this piece has generated a lot of buzz in industry circles.
What This Memo Doesn't Say
A few things worth clearing up before they turn into assumptions.
DoW wants to explore an API connection into contractor systems, but it doesn't name a specific vendor, platform, or technology. At this point, this is only directional, not an actual decision.
It's also important to note that the memo doesn't list or provide any information on funding or a timeline yet. What exists today is only a directive to explore.
The Memo Isn't the Problem. The Spreadsheet Is.
Here's the part that should actually worry a pricing team: for a lot of contractors, proving your pricing hasn't been optional for a long time. What's new is how fast you might have to prove it, and whether anyone even has to ask first.
For years, the real question was:
Show me your pricing. Can you talk through it and prove it during an audit?
The way forward doesn't look as straightforward with contractors needing to answer:
Could you prove it instantly with your systems open to the government directly?
Pricing is already the most scrutinized part of the proposal process, according to Deltek's 2026 Clarity research. It's the top challenge for contractors, and 51% say so. Thirty-eight percent say defensibility, not a technical problem, is the number one reason their proposal wasn't selected. More than half of the contractors still price in Excel, with about 20% using homegrown tools.
These numbers are significant on their own. Together, they say something simple: pricing that can't defend itself isn't a compliance problem, it's a losing bid. That's the gap this memo puts a spotlight on, whether or not the direct-access piece ever gets built.
Questions Worth Asking Now
- If an evaluator or auditor asked you to prove how a price was built, could you show it, or would you have to reconstruct it?
- How many of your proposals still route through a spreadsheet before they go out the door?
- Do you know your current exposure on CSDR reporting delinquency?
- If the government could pull cost and pricing data directly from your systems tomorrow, would your data hold up to scrutiny?
What Being Ready Looks Like
None of this requires a new reporting process bolted onto how pricing is already done. It requires pricing and cost data that's governed by design, so proving it isn't a special project every time someone asks.
ProPricer already centralizes pricing data, labor and material cost structures, and BOE justification in one governed system, connecting to Costpoint or any other ERP through an open API. It structures cost and pricing data across every contributor to a proposal, prime and subs included, into one auditable format. BOE Pro keeps estimating and pricing in sync, with AI-driven scoring that flags gaps before submission instead of after. On the government side, ProPricer Government Edition already lets some federal agencies and their contractors work from the same governed pricing structure. And Costpoint carries that same discipline into post-award cost accounting and CSDR reporting, with Dela AI automating contract setup, forecasting, and reporting behind an audit trail the whole way through.
If DoW builds that API, it has to pull from something. The organizations already running governed, connected pricing and cost data won't need to prepare for that moment. They'll already be in it.
The Bigger Picture
This memo probably isn't the last word on contractor cost transparency, and it doesn't stand alone. It's the latest move in a government-wide push that's been building since spring 2025: an executive order consolidating federal procurement under GSA, OMB's March 2026 directive requiring agencies to share vendor pricing data on IT contracts, and a May 2026 executive order shifting agencies from cost-plus to fixed-price contracts. The direction is consistent even where the details aren't.
The contractors who come out ahead won't be the ones with the lowest price. They'll be the ones who can prove, on demand, that it's the right one.
How Ready Is Your Pricing Function?
See how to replace spreadsheets with a standardized, audit-ready Basis of Estimate workflow in this session titled Mastering the Art of the BOE Workflow: Standardization that Delivers
