Hi
I'm looking at a proposal under the following scenario:
Single Source Award/Certified C&P Data required
Contract Type FFP (one T&M CLIN)
Offeror:
CAS covered (submits D/S).
IAW Disclosed Practices G&A base is TCI.
Offeror has a pool for material handling (M&H) (base - direct materials).
Direct materials and the expenses on the M&H pool are part of the G&A base.
1. Here's the way the offeror is burdening materials in the proposal:
Lets assume the M&H rate is 5% and G&A is 50%
Direct Materials is $100,000
Materials 100,000
M&H 5,000
Subtotal 105,000
G&A 52,500 (subtotal x G&A)
Total Material Cost 157,000
2. Here's the way I believe it materials should be burdened when the offeror has an M&H pool (value added G&A):
Materials 100,000
M&H 5,000
Subtotal 105,000
G&A 2,500 ( M&H expense x G&A)
Total Material Cost 107,500
3. Or if offeror has a TCI base:
Materials 100,000
G&A 50,000
Total Material Cost 150,000
So basically they are applying G&A on top of M&H and materials. believe that if the offeror applies an M&H to materials it can apply G&A to the handling expense only and not to the direct material cost. If the offeror has a TCI allocation base for G&A, then it should only apply G&A to direct materials with no M&H.
Are they doing this correctly or am I wrong?