Hello,

When completing a Cost Analysis of a supplier's proposal (as the Prime), and the supplier maintains their rates and factors as proprietary and they have a current/active FPRA; would you recommend still requesting field pricing assistance from DCMA? FFP. This is non-commercial. Over TINA. Per FAR, needs a Cost Analysis, there are no existing exceptions. Can the Cost Analyst proceed under the assumption that the rates and factors are reasonable? Or, is it still best practice to request field pricing assistance, despite the long lead time?

Always request field audit assist via DCMA or request that this be done by a third party.  The type you're describing are very straightforward and fast.  Some subs will allow a third party in order to expedite things, others will not.  

If you need a contract but also need to wait on the DCMA, add a downward-adjustment clause for rates in case there's something that comes back with a comment from the DCMA.

An FPRA, by definition, is an agreement between the firm and the government and may be based upon a previous audit:

Edit: “Forward Pricing Rate Agreement means a written agreement negotiated between a contractor and the. Government to make certain rates available during a specified period for use in pricing contracts or. modifications.” ( FAR 2.101)

As such, I would communicate the situation with the government and ask the KO or ACO for their involvement. You could ask for their review and/or recommendation for audit update/review. If the sub is proposing pricing based upon an FPRA, it must make the basis of the rates and any updated info available to the government for applicability to this action, review, possible audit updates and verification, etc.

“15.407-3 Forward pricing rate agreements.

       (a) When certified cost or pricing data are required, offerors are required to describe any forward pricing rate agreements (FPRAs) in each specific pricing proposal to which the rates apply and to identify the latest cost or pricing data already submitted in accordance with the FPRA. All data submitted in connection with the FPRA, updated as necessary, form a part of the total data that the offeror certifies to be accurate, complete, and current at the time of agreement on price for an initial contract or for a contract modification. (See the Certificate of Current Cost or Pricing Data at  15.406-2.)

       (b)  Contracting officers will use FPRA rates as bases for pricing all contracts, modifications, and other contractual actions to be performed during the period covered by the agreement. Conditions that may affect the agreement’s validity shall be reported promptly to the ACO. If the ACO determines that a changed condition invalidates the agreement, the ACO shall notify all interested parties of the extent of its effect and status of efforts to establish a revised FPRA.

       (c)  Contracting officers shall not require certification at the time of agreement for data supplied in support of FPRA’s or other advance agreements. When a forward pricing rate agreement or other advance agreement is used to price a contract action that requires a certificate, the certificate supporting that contract action shall cover the data supplied to support the FPRA or other advance agreement, and all other data supporting the action.”

If the subcontract pricing timing is time critical and audit support isn’t available to support the schedule , I like the idea of incorporating a downward adjustment clause in the subcontract. That is, if the KO/ACO concurs and that there is also a provision for passing on any savings to the prime, plus applicable markups, to the government.

10 hours ago, joel hoffman said:

15.407-3 Forward pricing rate agreements. 

Can you clarify why this was cited for the poster's prime/sub situation? 

On 3/13/2023 at 12:52 PM, realquiet said:

Hello,

When completing a Cost Analysis of a supplier's proposal (as the Prime), and the supplier maintains their rates and factors as proprietary and they have a current/active FPRA; would you recommend still requesting field pricing assistance from DCMA? FFP. This is non-commercial. Over TINA. Per FAR, needs a Cost Analysis, there are no existing exceptions. Can the Cost Analyst proceed under the assumption that the rates and factors are reasonable? Or, is it still best practice to request field pricing assistance, despite the long lead time?

How about having the supplier certify that the rates/factors used in its proposal are fully compliant with the FPRA they have executed with the government? Would that certification address your concern(s)?

The Certificate of Current Cost Pricing Data includes rate agreements with the government.

On 3/18/2023 at 12:19 PM, Neil Roberts said:

The Certificate of Current Cost Pricing Data includes rate agreements with the government.

More precisely, the certificate covers the data presented to the government in support of the proposed rates and any additional data that has come into being after the rate agreement was signed.

On 3/14/2023 at 5:49 PM, Neil Roberts said:

Can you clarify why this was cited for the poster's prime/sub situation? 

On 3/13/2023 at 2:52 PM, realquiet said:

supplier maintains their rates and factors as proprietary and they have a current/active FPRA

On 3/14/2023 at 7:24 AM, joel hoffman said:

An FPRA, by definition, is an agreement between the firm and the government and may be based upon a previous audit:

Edit: “Forward Pricing Rate Agreement means a written agreement negotiated between a contractor and the. Government to make certain rates available during a specified period for use in pricing contracts or. modifications.” ( FAR 2.101)

15.403-7 describes how FPRA’s are used to price contracts and contract actions.Here it concerns pricing a subcontract, apparently as part of a contract pricing action.