Can anyone explain to me the term "Net Open Commitments"? I think it relates to customer reporting of commitments vs. expenditures. Is it something one would need to address in an Internal Sweep conducted prior to executing a certificate of current cost or pricing data under TINA?

In what context is the term used? "Commitment" is a term of art in government accounting that may not translate directly to private industry accounting.

I am seeing it used in the context of pricing of Bill of Materials.

It sounds like the term relates to an estimate of the costs for obligations to vendors and subcontractors that have not yet been booked in the accounting system -- i.e., the total estimated costs associated with purchase orders and subcontracts awarded, less any accrued costs already recorded for those POs and subcontracts.

I've seen the term used in contracts that contain Cost Funds Status Report (CFSR) requirements, and open commitments ordinarily wouldn't apply to new contract proposals. However, they could be a routine consideration in negotiation of contract modifications, regardless of whether or not a CFSR is required, and if the mod is subject to the TINA, I believe open commitments would meet the definition of "cost or pricing data" covered by any certificate of current cost or pricing data.

When it comes to the TINA and executing certificates of current cost or pricing data, I'd recommend addressing all factual data included with the proposal in any internal sweep prior to execution of the certificate.

J

J, thanks. That is what I thought it might be. We don't have any contracts that are TINA covered that have modifications in process, so it is good to know the context in order to be prepared in the future.