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How to close FFP with ODC & Travel

Started by DHSGUY, Apr 28 2012 09:23 AM

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6 replies to this topic

#1 DHSGUY

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Posted 28 April 2012 - 09:23 AM

Hello All,
I saw that there was a similar topic, but it didn't have to do with closeout. I have a $7million commercial FFP contract with a CLIN to reimburse travel costs as an NTE for $105K and an ODC (reimbursable costs) CLIN as an NTE for $250K. When it comes to closeout, am I bound by the FAR timeline for FFP (6months) or Cost (36 months) seeing that there are cost clins? I've been told that if there is anything to do with cost reimbursement you treat it like a cost type contract. Just seems like small money compared to the overall contract to keep it open for so long because we don't have rates settled for the year the costs were incurred.

Thanks for the help.

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#2 Retreadfed

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Posted 28 April 2012 - 02:23 PM

Did you make the travel and ODC CLINs subject to the cost principles or merely state them as ceiling amounts similar to how these costs are treated in 52.212-4 ALT I?

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#3 Vern Edwards

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Posted 28 April 2012 - 04:02 PM

Quote

Just seems like small money compared to the overall contract to keep it open for so long because we don't have rates settled for the year the costs were incurred.

You're waiting for rates? Have you read FAR 42.708?

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#4 woops85

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Posted 30 April 2012 - 07:49 AM

Agree with Vern. I used to have folks tell me they could not close out their orders for same reason. They'd have $50K of travel on a $10M and want to wait 5 or 6 years for the vendor to get its audited rates. Had a lot of discussions about "unreconciled indirects"

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#5 Cajuncharlie

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Posted 01 May 2012 - 07:22 AM

Recently I have seen an increasing number of contracts with cost-only "pass-through" CLINs for travel and ODCs. Problem solved.

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#6 Retreadfed

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Posted 01 May 2012 - 06:06 PM

What do you mean by cost-only? The cost to the contractor is the direct cost of an expenditure plus any indirect costs attracted to a contract by that direct cost.

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#7 Cajuncharlie

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Posted 02 May 2012 - 07:01 AM

Retreadfed, on 01 May 2012 - 06:06 PM, said:

What do you mean by cost-only? The cost to the contractor is the direct cost of an expenditure plus any indirect costs attracted to a contract by that direct cost.

I should have said direct cost-only to be perfectly clear. I made the same point you did in an offeror question and received the same kind of answer I wrote, when I should have known better. In that case, travel was just another ODC, and the "D" covered "direct," so cost-only ODCs by definition excluded indirect costs that would otherwise be allocable to those direct costs.