Neil Roberts

Agree with what you say, Joel. And that is an important distinction compared to facts in this thread. On the other hand, Symvionics thinking is that (1) Government bias/bad faith may need to be proven and (2) the Government is not required to neutralize competitive advantage that one that one offeror may have over another. Seems possible to me that other offerors may be thought of as potentially proposing to accomplish some of the work through independent contractors, which perhaps may be seen as "subcontracts," therefore making DFAR 252.244-7001 more prominent. However, Symvionics is not a court or Board case.

Just FYI, See this site for some government thoughts about a similar protest, although your fact situation seems to be stronger https://www.gao.gov/products/B-408505#mt=e-report

Sounds like your company would be in breach of contract if it fails to provide the records. Suggest you involve an attorney with your situation and provide the written contract.

In my experience with major subcontracts, there has never been a general "retrieve and retain" process or clause included in a subcontract. However, a cost reimbursement contractor should be retaining documentation of claimed costs. There might be reasons why a prime might do that in a specific situation. However, the post does not indicate any details about what is going on. The poster might receive better comments if the situation was explained.

FAR 52.232-7 does not prohibit or require that a cost reimbursable item be limited by an NTE. It is up to your company to accept or reject that concept.

Not sure what is meant by the second sentence. As for the 3rd sentence, per FAR 52.232-7 (b)(1)(ii)(C), materials mean, among other things, ODC (which may include travel). Per (b)(3) and (b)(4), such material costs appear to be reimbursable. Does your contract clause indicate the same language?

It looks like this is only a DOD policy and does not apply to procurements controlled only by FAR. For Part 15 procurements in excess of the TINA threshold, contractors would typically submit its assertion and facts in support thereof in order to qualify the end item/service for an exemption from cost or pricing data. I assume the Contracting Officer would forward that info to DCMA for a decision.

My recollection is that Courts and Boards have generally indicated the answer to your 1st question is "yes" it should. Not sure what you are asking in your 2nd question. Are you asking whether a Court, Board, arbitrator, auditor, Contracting Officer or similar body or person may say or think otherwise? Sometimes making this effective may require significant time and money to litigate. There is no magic wand out there that you waive at everyone to change their mind immediately. One hopes that Courts and Boards and others would follow legal precedent. DCAA Contract Audit Manual 14.112-1 indicates the the answer to your 1st question is "yes." Not sure I answered your question.

Does this post relate to your previous post regarding Hybrid Contracts?

Litai, could you also please outline the facts that caused you to ask this question...what has been going on with whom? What has been said or done so far, etc.

There are a variety of definition of "subcontract" throughout FAR. Since none was provided for executive compensation, you may be free to apply whatever makes sense to you with respect to affiliate work if you can support with rationale. I would first consult the FSRS User Guide and Help Desk, and the Executive Compensation reporting community for more information. I would not borrow FAR 15.407-2 make-or-buy programs clause as applicable to reporting of executive compensation. Just because the Government defines work performed by an affiliate, subsidiary or division as work made by the prime, does seem to be meant to control reporting of executive compensation of subcontracts. Different interests may be involved. Also, the make-or-buy clause itself, including its definition is not generally applicable below $13.5M I think your company kind of "shot itself in the foot" by a process that issued a "subcontract" to an affiliate. This suggests that there should be an arms length transaction. Some companies have processes that establish issuing internal work orders or something similar to affiliates that it controls, divisions and wholly owned subsidiaries, not "subcontracts." As a result, since your company actually issued a subcontract document, it is subject to executive reporting in my view because that is what your company called it.

Here_2_Help, with respect to your quote above, I don't believe I intended or actually said that indirect costs are not reimbursable. To Elgueromeromero, you have asked if you are missing anything. My view is that you would be missing something if your decision was not supported by your company's Cost Accounting Standards (CAS) Disclosure Statement or Generally Accepted Accounting Principles (GAAP) with respect to how/which personnel charge and are responsible for answering audit questions from your customer regarding invoice/billing processes and who it is that your company is planning on sending to the audit site and how you are planning to charge that work. Previous commenters seem to have inferred this as well, but did not mention the above standards.

In my experience, the Government request to attend at a Government site is unusual. I would ask that the Government put its request in writing. Not clear if they have done so. I would respond that the auditors are welcome at your site, which would permit you to provide the "right" experts to answer any given question. I would ask that some of the basic questions be put in writing in advance. Since the Government has already stated that cost incurred for this topic is not an appropriate contract charge, you should consider booking costs incurred as indirect. Not sure how your accounting system handles that for personnel that charge direct. In the event it turns out that all or part of the work is justified as a direct contract charge, you should be able to reverse the booking within a reasonable amount of time. Or you may put the incurred costs into a holding account of some type until you make a final decision. Since the Government has predetermined that this work is not a contract charge, under no circumstances would I want to be in the position of having any personnel charge the contract for this work until the smoke has cleared.

Other examples of difficulty in administration include specifying which terms and conditions apply to each contract type. Some terms may be the same for both types and some may be different or not applicable. The timing of payments for example. Labor hourly rates are typically payable after performance every couple of weeks. The delivery of goods is typically payable when delivered. I personally would not prefer to receive and try to administer a mixed contract type arrangement in a single contract instrument. Instead, if possible, I would prefer the Government negotiate the complete deal and issue two different contract instruments to the contractor that are combined for price consideration.

Thanks for the clarification, Sunstrider. I assume this is a negotiated procurement and you will be receiving certified cost or pricing data from the prime contractor. You may eventually have post award justification to request an audit. In the meantime, since the prime is a sole source, suggest the best interest of the Government is for you to use your negotiation skills to request additional support for any questionable subcontractor pricing information/analysis. You do not have any other source of supply available to support the schedule at this time. Not sure why your focus is on subcontractor TINA requirements. If that subcontractor is already the lowest priced bidder and meets the requirements, what are your additional expectations? Communicate them to the prime. The prime may assert that there is adequate price competition, which eliminates TINA requirements for the subcontractor.

Facts are not that clear to me. Is this post from a prime contractor or the Government? Which is the sole source...the prime contractor or the subcontractor? Did the prime propose a listing of equipment to be purchased only from one source at one time or is it a time phased purchase to match the funding profile such that none of the contemplated purchases exceed TINA ? How is it known what supplier is "the apparent successful...supplier? In many situations, prime contractors have not yet evaluated, made a source decision or awarded an subcontract at the time of a proposal to the Government. Could the post please clarify who is who here? Thanks.

SBA final rules and FAR Part 52 clauses and provisions have been a long standing point of confusion and frustration in timing to sync them. The most recent version of FAR 52.219-xx includes the following language: Class Deviation 2019-O0003—Limitations on Subcontracting for Small Business. Effective immediately this deviation remains in effect until it is incorporated into the FAR and DFARS, or otherwise rescinded. As a result, many such clauses and provisions have been changed. You may find that final SBA rules you are concerned with have now been incorporated in FAR. You should confirm that with a review that compares the two if you are interested. The FAR Council process still considers the Class Deviation changes only an interim fix...hence the proposed rules process which may confirm the Class Deviation changes, revise or add to them when it is final. Hope this helps.

Xanadu, I must have missed a prior propose rule by the FAR Council. Do you have a reference to where a prior proposed rule by the FAR Council on this subject appeared in the Federal Register? The SBA is not part of the FAR Council.

Because Contractors may have adopted ethics rules that determine if contractor employees may accept "a ride," can we assume that this transportation is included in a Government furnished contract clause and that this clause was included in the RFP/ITQ?

ABC News reported " (NASA) officials issued a press release this week saying they would be undertaking a “cultural assessment study” of commercial partners SpaceX and Boeing “to ensure the companies are meeting NASA’s requirements for workplace safety, including the adherence to a drug-free environment.”

While they may be facts, they seem to be judgmental (negotiation position) and/or not relevant to or are not cost or pricing data ( a discussion took place, a decision was made). Therefore they wouldn't be indexed. Other examples include the fact that companies may be always looking to buy another company, merge or sell the company. When executives reach a final decision to pursue one of those items, it would be a fact that may impact future costs. "Always looking" is not a fact that has any affect on cost or pricing data because nothing has actually happened as a fact to affect the cost or pricing data. If you wish you may include "always looking" in your index but it seems to raise more questions than facts that affect cost or pricing data.

Suggest you contact GSA Regulatory Secretariat Division to obtain a referral contact that may be able to answer your questions regarding open action items related to this Open FAR Case Report item 2016-011: Regulatory Secretariat Division 1800 F Street, N.W. Washington 20405 Phone: 202-501-4755 E-mail: GSARegSec@gsa.gov

I assume you are posting about the relationship between the Government and a contractor? If not, FAR is not controlling.

Question for StePa (Special Test Equipment Procurement Agent?): Do you know if the Government prime contract is for a commercial end item or not. And if so, how do you know.

I don't see it as dictum. I see the Court believing that without making the Christian Doctrine applicable, the facts were not supported with any legal basis. Whether it is dictum or not, it may still be cited by litigants to bolster their case, and the court in their case may decide it is or is not dictum.