I have a question concerning VECPs and accounting/paying for savings dollars in the contract.
Situation - I have VECPs that were cut-in to production in FY03. We paid the old price for the part in the FY03 - FY07 FFP contract, including fee on the old part. We have finally settled the amount of savings and now want to cut it into the contract. Let say the savings are $1,000. We calculated the $1,000 on cost only. So, I paid $1,000 more of cost than we should have. But, in reality I paid $1,000 of cost plus 10%(fee) more than I should of. Does my VECP savings spreadsheet then calculate $1,000 per unit and 10% credit for overpaid fee?