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19 hours ago, here_2_help said:

Did the OP state whether the contract was subject to cost analysis?

Whether the government performs cost analysis on a proposal does not prohibit a contractor from including anything it wants in its proposal for an FFP contract.  Further, the FAR does not prohibit a contracting officer from agreeing to a price for an FFP contract that may include unallowable costs so long as the price is fair and reasonable.  

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42 minutes ago, Retreadfed said:

Whether the government performs cost analysis on a proposal does not prohibit a contractor from including anything it wants in its proposal for an FFP contract.  Further, the FAR does not prohibit a contracting officer from agreeing to a price for an FFP contract that may include unallowable costs so long as the price is fair and reasonable.  

My point was (as I suspect you know) that the contract type is not as relevant to the application of the cost principles as whether cost analysis is performed. The cost principles apply whenever the government performs cost analysis on the contractor's proposal. Your second sentence is true but not germane because that was not the point you were making in your previous post.

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50 minutes ago, here_2_help said:

My point was (as I suspect you know) that the contract type is not as relevant to the application of the cost principles as whether cost analysis is performed.

Sorry, but I did not get that from your earlier post.  This brings up another issue with the drafting of the FAR.  Whether the government is to use the cost principles as a tool when conducting cost analysis is an ambiguous topic in the FAR.  FAR 31.102 says that the cost principles shall be used in the pricing of fixed price contracts whenever cost analysis is used.  On the other hand, FAR 15.404-1(c)(2) makes the use of the cost principles discretionary when conducting a cost analysis.

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  • 2 weeks later...
13 hours ago, Retreadfed said:

To award a contract or to modify a contract?

C. Frog, for the current threshold for contracts and mods, See: 15.403-4 Requiring certified cost or pricing data (10 U.S.C. 2306a and 41 U.S.C. chapter 35).

Check out paragraphs (a)(1),  (a)(2) and (a)(3).

Edit: Sorry, Retreadfed, I meant to respond to C. Frog. I didn’t notice that it was your post I quoted. 

Edited by joel hoffman
Quoted wrong post.
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temporarily deleted. 

Edited by joel hoffman
Misread the post I am responding to.
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On 2/22/2021 at 1:29 PM, Retreadfed said:

Sorry, but I did not get that from your earlier post.  This brings up another issue with the drafting of the FAR.  Whether the government is to use the cost principles as a tool when conducting cost analysis is an ambiguous topic in the FAR.  FAR 31.102 says that the cost principles shall be used in the pricing of fixed price contracts whenever cost analysis is used.  On the other hand, FAR 15.404-1(c)(2) makes the use of the cost principles discretionary when conducting a cost analysis.

Are you saying that the cost analysis “technique and procedure” in  (c)(2)  (iv) is discretionary? 
 “(iv) Verification that the offeror's cost submissions are in accordance with the contract cost principles and procedures in part  31 and, when applicable, the requirements and procedures in 48 CFR chapter 99, Cost Accounting Standards.”

“ ... (2) The Government may use various cost analysis techniques and procedures to ensure a fair and reasonable price, given the circumstances of the acquisition. Such techniques and procedures include the following:”

I would disagree with your conclusion that the cost analysis doesn’t have to consider the cost principles. , when the cost principles in 31.1 are applicable to the proposed contract action.

If the cost principles are applicable to the pricing, then cost analysis should verify that the cost submission is in accordance with the cost principles and, when applicable, CAS.

One must read the applicable FAR coverage in context to avoid ambiguity and rendering applicable requirements meaningless. Your assertion of ambiguity is certainly convenient. So is your assertion that a proposer can base its proposal on anything that it wants to.

 

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