FAR 52.204-10—Reporting Executive Compensation and First-Tier Subcontract Awards.
Plain-English Summary
FAR 52.204-10 implements the federal transparency requirements for reporting executive compensation and first-tier subcontract awards. It covers the definitions needed to apply the clause, including who counts as an executive, what qualifies as a first-tier subcontract, what “month of award” means, and how total compensation is calculated. It also explains the public-reporting basis for the rule, the requirement to notify subcontractors that their reported information will be made public, and the prohibition on disclosing classified information. In practice, the clause requires certain prime contractors to report the names and total compensation of their five most highly compensated executives in SAM, and to report detailed information about qualifying first-tier subcontracts in FSRS. It also requires qualifying first-tier subcontractors to report their own executive compensation information. The clause is significant because it creates public visibility into how federal funds flow from prime contracts to subcontractors and into executive pay at certain high-revenue, federally funded entities. Contractors and contracting officers must pay close attention to the reporting thresholds, timing, and data elements because missing or inaccurate reports can affect compliance and transparency obligations.
Key Rules
Key definitions control scope
The clause defines executive, first-tier subcontract, month of award, and total compensation. These definitions determine who is covered, which subcontract awards must be reported, when reporting deadlines start, and how executive pay is measured.
Prime contractor executive reporting
A contractor must report the names and total compensation of its five most highly compensated executives in SAM as part of annual registration if it meets both revenue tests: 80 percent or more of annual gross revenues from federal sources and at least $25 million in annual gross revenues from federal sources. The reporting is also required only if the public does not already have access to the compensation information through SEC filings or certain tax filings.
First-tier subcontract award reporting
For each first-tier subcontract at or above the applicable threshold in FAR 4.1403(a), the contractor must report detailed award information in FSRS by the end of the month following the month of award, unless the contracting officer directs otherwise or an exception in the clause applies. The report includes the subcontractor’s identity, award amount, dates, locations, contract references, agency data, TAS, and NAICS code.
Subcontractor executive reporting
A first-tier subcontractor that receives a qualifying subcontract must report the names and total compensation of its five most highly compensated executives by the end of the month following award and annually thereafter, calculated based on the subcontractor’s preceding completed fiscal year, unless the contracting officer directs otherwise. This requirement applies when the subcontract value meets the threshold in FAR 4.1403(a).
Public disclosure notice required
Because the statute requires reported subcontract information to be made public, the contractor is responsible for notifying subcontractors that the required information will be publicly available. This is a compliance and relationship-management obligation, not just a data-entry step.
Classified information is excluded
Nothing in the clause requires disclosure of classified information. If a report would otherwise involve classified material, the contractor is not required to disclose that information under this clause.
Responsibilities
Contracting Officer
Ensure the clause is included when prescribed, identify any direction or exceptions allowed by the clause, and manage award actions in a way that supports accurate subcontract reporting. The contracting officer may also direct otherwise where the clause permits.
Prime Contractor
Determine whether it meets the executive-compensation reporting tests, report the five most highly compensated executives in SAM when required, report qualifying first-tier subcontract awards in FSRS by the required deadline, and notify subcontractors that reported information will be made public.
First-Tier Subcontractor
When it receives a qualifying first-tier subcontract, report the names and total compensation of its five most highly compensated executives by the required deadline and annually thereafter, unless an exception or contracting officer direction applies.
Subcontractor Parent Company
Provide the parent company unique entity identifier when required for subcontract award reporting, if the subcontractor has a parent company.
Agency / Government
Use the reported data for transparency and oversight purposes, and ensure the reporting framework aligns with statutory public-reporting requirements.
Practical Implications
Contractors need a reliable process to identify whether they meet the 80 percent / $25 million revenue test and whether executive compensation is already publicly available through SEC or tax filings.
The subcontract reporting deadline is short: by the end of the month after award. That means award administration, data collection, and FSRS entry must happen quickly and consistently.
The reporting package is detailed, and missing items such as TAS, congressional district, or the correct NAICS code can create incomplete submissions.
Contractors should build a standard notice to subcontractors explaining that reported information will be made public, because this is an explicit clause requirement.
A common pitfall is confusing supplier agreements or indirect-material arrangements with first-tier subcontracts; the clause excludes ordinary vendor/supplier arrangements that support multiple contracts or are treated as indirect costs.
Official Regulatory Text
As prescribed in 4.1403 (a) , insert the following clause: Reporting Executive Compensation and First-Tier Subcontract Awards (Jun 2020) (a) Definitions . As used in this clause: Executive means officers, managing partners, or any other employees in management positions. First-tier subcontract means a subcontract awarded directly by the Contractor for the purpose of acquiring supplies or services (including construction) for performance of a prime contract. It does not include the Contractor’s supplier agreements with vendors, such as long-term arrangements for materials or supplies that benefit multiple contracts and/or the costs of which are normally applied to a Contractor’s general and administrative expenses or indirect costs. Month of award means the month in which a contract is signed by the Contracting Officer or the month in which a first-tier subcontract is signed by the Contractor. Total compensation means the cash and noncash dollar value earned by the executive during the Contractor’s preceding fiscal year and includes the following (for more information see 17 CFR 229.402(c)(2) ): (1) Salary and bonus . (2) Awards of stock, stock options, and stock appreciation rights . Use the dollar amount recognized for financial statement reporting purposes with respect to the fiscal year in accordance with the Financial Accounting Standards Board’s Accounting Standards Codification (FASB ASC) 718, Compensation-Stock Compensation. (3) Earnings for services under non-equity incentive plans . This does not include group life, health, hospitalization or medical reimbursement plans that do not discriminate in favor of executives, and are available generally to all salaried employees. (4) Change in pension value . This is the change in present value of defined benefit and actuarial pension plans. (5) Above-market earnings on deferred compensation which is not tax-qualified . (6) Other compensation, if the aggregate value of all such other compensation ( e.g. , severance, termination payments, value of life insurance paid on behalf of the employee, perquisites or property) for the executive exceeds $10,000. (b) Section 2(d)(2) of the Federal Funding Accountability and Transparency Act of 2006 (Pub. L. 109-282), as amended by section 6202 of the Government Funding Transparency Act of 2008 (Pub. L. 110-252), requires the Contractor to report information on subcontract awards. The law requires all reported information be made public, therefore, the Contractor is responsible for notifying its subcontractors that the required information will be made public. (c) Nothing in this clause requires the disclosure of classified information (d) (1) Executive compensation of the prime contractor. As a part of its annual registration requirement in the System for Award Management (SAM) (Federal Acquisition Regulation (FAR) provision 52.204-7 ), the Contractor shall report the names and total compensation of each of the five most highly compensated executives for its preceding completed fiscal year, if– (i) In the Contractor’s preceding fiscal year, the Contractor received- (A) 80 percent or more of its annual gross revenues from Federal contracts (and subcontracts), loans, grants (and subgrants), cooperative agreements, and other forms of Federal financial assistance; and (B) $25,000,000 or more in annual gross revenues from Federal contracts (and subcontracts), loans, grants (and subgrants), cooperative agreements, and other forms of Federal financial assistance; and (ii) The public does not have access to information about the compensation of the executives through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m(a), 78o(d) ) or section 6104 of the Internal Revenue Code of 1986. (To determine if the public has access to the compensation information, see the U.S. Security and Exchange Commission total compensation filings at http://www.sec.gov/answers/execomp.htm .) (2) First-tier subcontract information . Unless otherwise directed by the Contracting Officer, or as provided in paragraph (g) of this clause, by the end of the month following the month of award of a first-tier subcontract valued at or above the threshold specified in FAR 4.1403 (a) on the date of subcontract award, the Contractor shall report the following information at http://www.fsrs.gov for that first-tier subcontract. (The Contractor shall follow the instructions at http://www.fsrs.gov to report the data.) (i) Unique entity identifier for the subcontractor receiving the award and for the subcontractor's parent company, if the subcontractor has a parent company. (ii) Name of the subcontractor. (iii) Amount of the subcontract award. (iv) Date of the subcontract award. (v) A description of the products or services (including construction) being provided under the subcontract, including the overall purpose and expected outcomes or results of the subcontract. (vi) Subcontract number (the subcontract number assigned by the Contractor). (vii) Subcontractor’s physical address including street address, city, state, and country. Also include the nine-digit zip code and congressional district. (viii) Subcontractor’s primary performance location including street address, city, state, and country. Also include the nine-digit zip code and congressional district. (ix) The prime contract number, and order number if applicable. (x) Awarding agency name and code. (xi) Funding agency name and code. (xii) Government contracting office code. (xiii) Treasury account symbol (TAS) as reported in FPDS. (xiv) The applicable North American Industry Classification System code (NAICS). (3) Executive compensation of the first-tier subcontractor. Unless otherwise directed by the Contracting Officer, by the end of the month following the month of award of a first-tier subcontract valued at or above the threshold specified in FAR 4.1403 (a) on the date of subcontract award, and annually thereafter (calculated from the prime contract award date), the Contractor shall report the names and total compensation of each of the five most highly compensated executives for that first-tier subcontractor for the first-tier subcontractor’s preceding completed fiscal year at http://www.fsrs.gov , if- (i) In the subcontractor’s preceding fiscal year, the subcontractor received- (A) 80 percent or more of its annual gross revenues from Federal contracts (and subcontracts), loans, grants (and subgrants), cooperative agreements, and other forms of Federal financial assistance; and (B) $25,000,000 or more in annual gross revenues from Federal contracts (and subcontracts), loans, grants (and subgrants), cooperative agreements, and other forms of Federal financial assistance; and (ii) The public does not have access to information about the compensation of the executives through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m(a), 78o(d) ) or section 6104 of the Internal Revenue Code of 1986. (To determine if the public has access to the compensation information, see the U.S. Security and Exchange Commission total compensation filings at http://www.sec.gov/answers/execomp.htm .) (e) The Contractor shall not split or break down first-tier subcontract awards to a value below the threshold specified in FAR 4.1403 (a), on the date of subcontract award, to avoid the reporting requirements in paragraph (d) of this clause. (f) The Contractor is required to report information on a first-tier subcontract covered by paragraph (d) when the subcontract is awarded. Continued reporting on the same subcontract is not required unless one of the reported data elements changes during the performance of the subcontract. The Contractor is not required to make further reports after the first-tier subcontract expires. (g) (1) If the Contractor in the previous tax year had gross income, from all sources, under $300,000, the Contractor is exempt from the requirement to report subcontractor awards. (2) If a subcontractor in the previous tax year had gross income from all sources under $300,000, the Contractor does not need to report awards for that subcontractor. (h) The FSRS database at http://www.fsrs.gov will be prepopulated with some information from SAM and the FPDS database. If FPDS information is incorrect, the contractor should notify the contracting officer. If the SAM information is incorrect, the contractor is responsible for correcting this information. (End of clause)