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Invoicing time limits - CPFF contract


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I've posted this before -- prime contractors don't need a DCAA audit in order to finalize rates with their subcontractors and close-out their subcontracts. The government doesn't have privity.

Primes who say they can't close out subcontracts because DCAA hasn't audited, and DCMA (or whomever) hasn't negotiated final rates, simply don't understand how the prime/subK relationship works with respect to 52.216-7. And more likey than not, they simply aren't bothering to fulfill their responsibilties as prime by performing timely subK close-outs.

H2H

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This was posted a few years ago and I'm wondering if there's any update? Is there anything requiring vendors to invoice within XX days of physical completion of a contract or any other happening (like the end of an option period). I work with some behemoth companies for which I'm trying to close contracts/award for fiscal year 2013, 2014 and sometimes before that. I'm having difficulty in fathoming why when you have a FFP award for 12 months at $X.XX , they can't submitt final invoices withot having to beg for 10 or 12 months? So much for meeting close out standards.

Please allow me to clarify. I am working with awards issued with FAR Part 12 clauses and 99% are Firm Fixed Price.

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FAR 12.213 allows contracting officers to draft terms and conditions (such as an invoice deadline requirement) and to include those terms and conditions contracts for commercial items.

Here's an example. The following words appear in GSA's IWAC ITSS Invoicing Instructions:

#1 - Invoices Instructions

The contractor shall invoice for the entire delivery order amount upon completion of the project unless otherwise specified in the individual contract/delivery/purchase order.

* * * *

Final Invoice (if required): Invoices for final payment must be so identified and submitted within 60 days from delivery completion (i.e. delivery) and no further charges are to be billed. A copy of the written acceptance of delivery completion must be attached to final invoices. The contractor shall request from GSA an extension for final invoices that may exceed the 60-day time frame.

Here's another example, from a Town of Fairfax contract:

G. The CONSULTANT will be reimbursed, as promptly as fiscal procedures will permit upon receipt by the LOCAL AGENCY’s Contract Manager of itemized invoices. Invoices shall be submitted no later than 45-calendar days after the performance of work for which the CONSULTANT is billing.

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FAR 12.213 allows contracting officers to draft terms and conditions (such as an invoice deadline requirement) and to include those terms and conditions contracts for commercial items.

...provided the terms and conditions are not inconsistent with customary commercial practice or a waiver has been granted (see FAR 12.302( c )).

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I think FAR 12.213 already limits CO-written terms and conditions to those based on commercial practices -- no need to reach to FAR 12.302.

That's interesting. ji20874 thinks that one can reasonably infer the limitation on the use of terms and conditions inconsistent with customary commercial practice (which is expressed at FAR 12.302( c )) from the paragraph below. Does anyone else read it that way?

It is a common practice in the commercial marketplace for both the buyer and seller to propose terms and conditions written from their particular perspectives. The terms and conditions prescribed in this part seek to balance the interests of both the buyer and seller. These terms and conditions are generally appropriate for use in a wide range of acquisitions. However, market research may indicate other commercial practices that are appropriate for the acquisition of the particular item. These practices should be considered for incorporation into the solicitation and contract if the contracting officer determines them appropriate in concluding a business arrangement satisfactory to both parties and not otherwise precluded by law or Executive order.

I would say that this paragraph provides guidance for incorporating terms and conditions that are consistent with customary commercial practice and is silent on the issue of incorporating terms and conditions inconsistent with customary commercial practice.

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Don,

Please don't start again with your bullying. You misrepresent what I think. What I wrote is true: FAR 12.213 allows contracting officers to incorporate commercial practices as terms and conditions in commercial contracts. FAR 12.213 only provides authority for incorporating commercial practices, so a contracting officer who honorably works under FAR 12.213 will never need to worry about violating FAR 12.302.

FAR 12.213 only addresses commercial practices, and provides the standard for incorporating commercial practices as terms and conditions; namely, the contracting officer determines them appropriate in concluding a business arrangement satisfactory to both parties and not otherwise precluded by law or executive order.

You're point is based on faulty logic. A commercial practice allowed as a term and condition under FAR 12.213 cannot possibly be inconsistent with commercial practice under FAR 12.302, so there is no time when the use of 12.213 will be limited by 12.302. See? I hope this display will work:

  • FAR 12.213 allows a contracting officer to incorporate a commercial practice as a term and condition in a commercial item contract, and
  • FAR 12.302 allows a contracting officer to incorporate a term and condition inconsistent with commercial practice in a commercial item practice.

gittist,

I hope my posting in no. 28 is helpful to you. If it is a commercial practice in your segment of the marketplace for buyers and sellers to agree on invoice submission deadlines, then FAR 12.213 gives you the authority to incorporate such a term and condition in your commerical item solicitations and contracts. But even if this isn't a commercial practice, you can still incorporate such a term and condition if you can get the waiver contemplated by FAR 12.302.

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Guest Vern Edwards

ji20874:

Contradiction is not bullying. I see nothing even close to bullying in Don's post. I see him being precise, which is entirely appropriate.

In Post #28 you wrote:

FAR 12.213 allows contracting officers to draft terms and conditions (such as an invoice deadline requirement) and to include those terms and conditions [in] contracts for commercial items.

In Post # 29, Don responded by saying that a CO could include such terms and conditions only if they are not inconsistent with commercial practices and that they would need a waiver under 12.302( c ) to incorporate noncommercial practices.

In Post # 30, you responded:

I think FAR 12.213 already limits CO-written terms and conditions to those based on commercial practices -- no need to reach to FAR 12.302.

Don challenged you in Post # 31, writing:

I would say that [FAR 12.213] provides guidance for incorporating terms and conditions that are consistent with customary commercial practice and is silent on the issue of incorporating terms and conditions inconsistent with customary commercial practice.

Then, in Post # 32, you said:

FAR 12.213 allows contracting officers to incorporate commercial practices as terms and conditions in commercial contracts. FAR 12.213 only provides authority for incorporating commercial practices, so a contracting officer who honorably works under FAR 12.213 will never need to worry about violating FAR 12.302.

in my view, FAR 12.213 neither "limits" COs from doing anything nor "provides authority" for COs to do anything. Of the four sentences in FAR 12.213, the operative one is this:

These [other commercial] practices should be considered for incorporation into the solicitation and contract if the contracting officer determines them to be appropriate to concluding a business arrangement satisfactory to both parties and not otherwise precluded by law or Executive Order.

That's guidance. All that says is that a CO "should consider" doing something if certain conditions are met. It is a long reach to infer from that sentence a prohibition against the use of noncommercial practices. In fact, there is no absolute prohibition, since FAR 12.302( c ) permits the incorporation of noncommercial practices under a waiver. Moreover, FAR 12.213 does not "provide authority" for a CO to tailor commercial items clauses to incorporate other commercial practices. It says only that a CO should consider doing something when certain conditions are met. At most, permission is implied, not express. It is FAR 12.302 that provides authority to tailor commercial item terms to incorporate other commercial practices and that prohibits the use of noncommercial practices without a waiver. The claim that a CO may rely on FAR 12.213 and "never need" worry about FAR 12.302 is dead wrong. There is no "may", "may not", or "shall not" in FAR 12.213.

Don made no error in logic, and he is not bullying because he publicly contradicted you. Really, you needn't have responded to Don's Post # 29 at all, except, perhaps, to say, Thanks, Don. That's correct.

I would not have stuck my nose into this had it not been for the"bullying" remark.

Vern

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