Former_DCAA

One of my clients has a subcontract from a large prime that's structured as a T&M award fee, has anyone seen that before? They get reimbursed for Time at fixed rates but without any fee/profit in the labor rate buildup and then get an award fee based on scoring criteria.

Thanks, I guess the bigger question is whether the transfer is considered a subcontract. Currently, they don't issue a subcontract to the other segment, just an order.

One segment of a company receives a prime CAS-Covered contract. A portion of the work is completed by another segment of the company through an interorganizational transfer, without the work being competed. There is no "subcontract" issued, but instead an interorganizational order. Assuming no exception to CAS applies, would CAS apply to this interorganizational order?

I will look for the RFP. In the Task Order section B.6, it says The Total NTE for this task order is 800K, has the PoP, Contract Type as T&M and then just has the table posted with no additional context.

I was not around at the time, but my understanding is that it's directly from our proposal to the gov't and they just copy and pasted it into the Task Order.

I agree, this is my first time seeing a table of hours by category in the task order.

It's strange, its just hanging out there on its own page with no reference to it.

On a T&M task order, where a table of hours and rates by labor category is incorporated into the task order, what is the procedure for transferring hours between labor categories (while still staying within the overall budget)? The project was started in 2020 and due to turnover, the hours mix will be different, but the overall cost will remain the same and the work will get done. However, the contracting officer is giving us a hard time about the change, without pointing to any guidance. I've reviewed the IDIQ, task order and FAR 52.243-3 and don't see reference to hours changes. Thanks

I think absent a plan to get people back to the office or attempt to sublease or break the lease, even if not truly idle facilities, DCAA could just use reasonableness to question the costs and that would be my position as an auditor.

In the scenario I'm dealing with, maybe 5 out of 100 people are coming in due to essentially permanent telework. Without further DCAA guidance, I assume many auditors will take that position.

Does anyone have experience with how DCAA is treating facilities costs for contractors that have not returned to the office or have only partially returned? I see 2 scenarios: 1) The company plans to return, however delayed their plans due to Omicron and increased cases. - Still past the 1 year generally allowed for idle facilities per FAR 31.205-17 Idle Facilities and Idle Capacity, would DCAA question lease costs? 2) The company realized that they don't need either all or some of the office space and should be looking into breaking the lease or subleasing - Would lease termination costs be allowed?

If a company had a settled indirect rate year and then discovers some sort of fraud that changes the rates, is there a mechanism to redo the settled rates to account for the change? I'm not seeing anything in FAR 42.705 Final indirect cost rates.

Thanks for the insight. The company only rents one building that houses all employees and all direct and indirect functions are performed there (plus some telework). There are a few other very small commercial contracts and gov't subcontracts, but this one contract is about 95% of the total work.

That's kind of the approach I was thinking, I just don't know what happens if they wind up winning another contract and that Contracting Officer rejects that idea.

That is correct. The reason is that the indirect rates are extremely high and this is a change that can have the biggest impact. It is definitely a stretch though.