govtacct02

Here_2_help, Thanks for your clarfication....helpful and enlightening as usual. govtacct02

Thanks, Here_2_Help. However, for some interesting reading, see the below URL. It is a a letter by the head of the Professional Services Council written in 1998 to the CAS board review panel. The writer cites some historical communications from the GAO about the need for disclosed/consistency requirements in accounting practices to help proposal evaluators compare proposals that were submitted under TINA (negotiated procurements). http://www.pscouncil.org/pdfs/GAOCostAccou...June16,1998.pdf The writer opines "...one of the driving concerns which led to the conclusion that cost accounting standards were needed was the large number of negotiated procurements in which prices were based on cost estimates, supported by cost data, in the context of a lack of competition and a lack of market restraints." The writer further opines that "The CAS Board has no mission with respect to contracts for which cost or pricing data are not required or submitted. Any procurement that does not require cost or pricing data submission must also not require compliance with cost accounting standards." Does this provide some further insight ??

Answer to your question #1: It is possible, but probably should not happen unless the initial commerciality determination was made with inadequate proof to support the qualification of the item as Commercial as defined in FAR 2.1 and the second buyer is correcting something that never should have happened. It doesn't sound like your situation fits that scenario. There are many misconceptions about Commerciality that often lead a buyer (whether Government agency or prime contractor) to confuse the determination of a supply or service as a commercial item with price-related decisions. I have been in situations where a buyer refuses to acknowledge the commerciality determination made by another agency or company for a same or similar item because they believed that they would not get the best price and they would somehow lose some control if the item was procured as a commercial item. I think this goes against the guidance that the DoD put out in its Commercial Item Handbook, (URL below). http://www.acq.osd.mil/dpap/Docs/cihandbook.pdf Answer to your question #3: See FAR 15.403-4 Is the real question "Can something be done to correct an initial determination that an item is NOT commercial when you believe you have sufficient proof that it meets the tests of Commerciality at FAR 2.1????

I am trying to determine if there is anything in the FAR that would expressly prohibit an arrangement whereby if a company owes money to the Government on a contract that it is actively performing (credit not resulting from a noncompliance with TINA or Defective Pricing), it could offset the credit balance due to the Government against the next monthly invoice due to the contractor rather than return the money to the Government. I have looked at FAR 32.6 and the payment clauses at 52.232 and don't see any express prohibitions. Could such an arrangement be made with the Contracting Officer?

Here_ We've experienced this lately at my company, too. I'll try to do some research and get back to you.

Are you asking when is the relevant date to have the sub certify its cost or pricing data? It may be required more than once. To anaswer your question, check out the NCMA Headquarters website, for a presentation entitled "Managing Subcontract Defective Pricing" that was presented on April 27, 2005. The presentation can be found at the below URL www.ncmahq.org/files/FileDownloads/PPTs/809_Masiello.ppt

Another thing you might want to consider in your decision about what are appropriate #hours for a "Person Year" is the contract requirements. What type of contract is this? The requirements for support may be that the workweek is nonstandard, that is, more than 5 days or more than 8 hours per day. 1,980 also may include subtractions for paid absences, holiday, and vacation, but additions for work on the 6th and 7th weekday or work past 8 hours/day.

I am taking a survey to get an idea as to how other people in industry handle identification and segregation of the cost of unallowable activities for pricing, billing and accumulating actual costs incurred. If you would be willing to share what you do, or your perspective on this task, I'd appreciate it. Do you: 1) Survey people on % of time spent on unallowable activities during the year (prospectively and/or retrospectively) and then make a disallowance in calculating expenses/rates for pricing, billing and accumulating actual costs incurred. 2) Require assignment of time to an "Unallowable" cost objective at the time incurred/known unallowable 3) Some combination of the above 4) Some other method? Thanks in advance for your help.

Here, Thank you...and Happy Birthday. govtacct02

The FAR material cost principle states at 31.205-26 (e) "Allowance for all materials, supplies, and services that are sold or transferred between any divisions, subdivisions, subsidiaries, or affiliates of the contractor under a common control shall be on the basis of cost incurred in accordance with this subpart." Hypothetical situation: Let's assume that there is work being performed by a sister unit for your company (separate CAS Segment), who is an affiliate under common control. The affiliate does not qualify to be able to transfer costs at price. Let's say for financial measurement purposes, you contracted for the work to be done by this affiliiate on a FFP basis. Your prime contract is CPFF, so the prime contract has the Allowable Cost & Payment clause. Therefore, you have to submit and certify final indirect rates. Let's say the affiliate's cost is part of an allocation base for an indirect rate of yours. If the affiliate otherwise has no requirement to submit final indirect rates (no flexibly priced business), would they have to operate (for your sake) as if they were covered by the Allowable Cost & Payment clause (even though this is a FFP arrangement) and adjust their billings or memo entry their costs to you on an allowable actual costs incurred basis because of the fact that you have a CPFF contract and the above stated cost principle is in effect in your prime contract? Would you include their actual costs incurred (both allowable & unallowable) in the allocation base for the indirect rate as mentioned above, or their FFP billings to you? Thanks for your help.