frog2 Posted February 4, 2009 Report Share Posted February 4, 2009 Sanity Check please. RE: A contractor?s proposal Are the following statements correct? o If a single source contractors fixed lump sum proposal over $650K can be determined to be fair and reasonable (F&R), using means other than obtaining certified cost or pricing data (CPD), even if the method of making the F&R determination isn?t one of the exemptions listed for not getting CPD, CPD is not required. o A contractors audited forward pricing rates, by themselves, can be judged "F&R" based solely on a DCAA audit report finding nothing objectionable - that is, the rates are reasonable. o If the other elements by which the reasonable rates are multiplied - i.e. the number of labor hours, materials, etc. can be determined to be F&R, then the proposal is F&R Link to comment Share on other sites More sharing options...
Navy_Contracting_4 Posted February 4, 2009 Report Share Posted February 4, 2009 None of the statements offered are necessarily correct, standing alone. 1. The requirement for CPD is statutory, and there are only 4 exceptions. The circumstances you describe might fall under the fourth exception (Waivers), but only the Head of the Contracting Activity can decide if the specific circumstances justify a waiver, and that will probably depend on the method used to make the F&R determination. 2. A contractor's audited forward pricing rates may be considered F&R only if the circumstances upon which they are based remain substantially unchanged. For example, if the contractor's audited forward pricing rates were based on a certain level of revenue, and your proposal was going to result in a significant increase in that level, the contractor's indirect rates might well be affected, and the forward pricing rates might no longer be F&R. 3. A rote roll-up of calculations based on "reasonable" rates cannot, by itself, support a F&R determination. One must examine and consider the resulting price as well. And since you're doing a cost analysis, you'll have to consider profit/fee separately. Link to comment Share on other sites More sharing options...
frog2 Posted February 5, 2009 Author Report Share Posted February 5, 2009 None of the statements offered are necessarily correct, standing alone.1. The requirement for CPD is statutory, and there are only 4 exceptions. The circumstances you describe might fall under the fourth exception (Waivers), but only the Head of the Contracting Activity can decide if the specific circumstances justify a waiver, and that will probably depend on the method used to make the F&R determination. 2. A contractor's audited forward pricing rates may be considered F&R only if the circumstances upon which they are based remain substantially unchanged. For example, if the contractor's audited forward pricing rates were based on a certain level of revenue, and your proposal was going to result in a significant increase in that level, the contractor's indirect rates might well be affected, and the forward pricing rates might no longer be F&R. 3. A rote roll-up of calculations based on "reasonable" rates cannot, by itself, support a F&R determination. One must examine and consider the resulting price as well. And since you're doing a cost analysis, you'll have to consider profit/fee separately. Link to comment Share on other sites More sharing options...
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