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Everything posted by here_2_help

  1. "It depends." It depends on what G&A allocation base the prime contractor uses. And it depends on whether or not the prime contractor is subject to the requirements of CAS 410 -- i.e., subject to "Full" CAS coverage. Assuming CAS 410 is applicable: In a Total Cost Input (TCI) base, then yes--absolutely the prime must apply G&A to all of its subcontractors' costs, including Travel. In a Value-Added Base, then no -- absolutely the prime must not apply G&A to any of its subcontractors' costs. In a Single Element G&A base, then whether G&A is applied will depend on what cost element the prime has chosen as its G&A allocation base. If CAS 410 is not applicable, then the prime is only required to elect a G&A allocation base and then use it consistently. The prime would have a wide latitude in possible allocation bases; the one chosen need not be among the three required by CAS 410.
  2. I agree with Patrick, and will add that you must submit an incurred cost submission when you have any contract, prime or subK, that includes 52.216-7. The clause requires the submission.
  3. I made a prediction without a date, which (as you know) is the best kind of prediction. To your point, I agree that the legal settlements will start occurring years from now. I believe the suits (filed under seal, I expect) will come sooner, perhaps in 2023 or even as early as 2022. It only takes one impliedly false certification to give rise to an action (at least, that's what I've been told). FYI, the legal webinar I attended yesterday asserted that the Vaccination Mandate clause would likely be found to be material under the Escobar implied false certification test.
  4. The "human capital" issue has been in play for more than a decade. Which is to say, more than 10 years ago, leaders were told to expect a dramatic uptick in workforce attrition, driven primarily through retirements of aged workers. I was quoted in an Aviation Week article on this topic (again, more than a decade ago). Any leader who hasn't been preparing for this for a long time isn't much of a leader, in my view.
  5. Prediction: The vaccination requirements will be enforced through the action of private attorneys general, acting through the False Claims Act.
  6. This is October, 2021. Six years ago was October, 2015. The audit report was issued September, 2015. Sign the ICRA. Submit zero dollar close-out vouchers. See what happens.
  7. I don't think that's the issue. The contractor billed at certain indirect rates during the period of contract performance. Then the books closed for the last year of performance and, six months or so later, the contractor submitted is final billing rate proposal IAW 52.216-7. The proposal was audited and an audit report was issued. The government customer subsequently (a decade later) issued a final indirect cost rate agreement at the audit-recommended rates. There is no indication that the contractor ever adjusted the rates it used for billing to match the recommended rates in the audit report. (We don't know whether the rates were adjusted or not, to be clear.) However, we really need to know the date of the audit report. If the audit report was issued more than six years ago, and if the audit-recommended rates were different that what the contractor had been billing, then neither party has the ability to assert a claim for any differences at this late date, because the Contract Disputes Act's Statute of Limitations would have expired. If the audit report were issued less than six years ago, then one party might have the basis to assert a claim for the difference. If no claim can be asserted, submit the final voucher at the incurred cost rates -- i.e., a zero dollar final voucher. See what happens.
  8. I'm not sure there will be a lot of pushback. It's likely that government contractors will lose employees over this mandate. How many? Probably not a lot; but some. I expect manufacturers to be the hardest hit; but the E.O. doesn't seem to be pointed at them, so we'll have to see. A colleague and I were discussing this issue yesterday and we wondered where those people who choose to depart, rather than get vaccinated, will go? Certainly not to another government contractor that will be subject to the same mandate. Thus, it seemed to us that the people who choose to depart a contractor essentially will have made the decision to depart the industry altogether, and will end up somewhere in the commercial sector. To my way of thinking, the E.O. vaccination mandate is not too different from the Drug-Free Workplace Act, in that you agree to more stringent rules/restrictions on your personal conduct as an employment requirement with a government contractor. Doesn't matter what State law permits; you're subject to Federal law by virtue of your employment with a contractor that has accepted the contract clause.
  9. I see from the WIFCON front page that DoD has issued its Class Deviation, to be effective immediately.
  10. Agree to disagree. The basis of our disagreement seems to be a misunderstanding of the difference between negotiated profit and realized gross margin.
  11. Vern, Yes, the core of my disagreement is your theoretical position that the amount profit does not provide a contractor with incentive. I believe that it does. I do believe that establishing higher contract prices or fixed-fees during contract negotiation will motivate contractors to do better during contract performance. You ask for evidence, and all I can offer is anecdotal data. One such anecdote is the (true) story of a prime contractor who entered into a FFP subcontract where the margins were so tight, the only way the subcontractor could make any money was to assign only its most junior technical folks to the project. Unsurprisingly, the junior folks made a lot of junior-folks-type errors along the way, resulting in a Level III CAR from DCMA--assessed against the prime, of course. That's all I've got.
  12. Vern, I'm going to disagree with you. Reference FAR 15.404-4 (Profit). (Emphasis added.) It's true that the word "incentive" does not appear in the above quote. However, I see the words "stimulate" and "motivate" in the regulations. Other possible words that could have been used are: "prompt," and "encourage" -- according to an online list of synonyms. Also note the reference to "optimum contract performance." How is it defined? How can it be achieved if not through incentivizing the contractor through profit on its performance? I assert that the use of weighted guidelines does very little, if anything at all, towards achieving innovation and performance speed -- both things that DoD Leadership claims are important to national security. Misuse of the guidelines is even worse; misuse is actually detrimental to the Department's stated goals. Further, you note that they are only "guidelines." However, in practice, they establish policy limits on the amount of profit that a contracting officer is willing to negotiate with a contractor. And they establish exactly how that amount of profit is to be calculated, at least on a prenegotiation basis. Factors that are not listed in the weighted guidelines are not considered. (To be fair, I should say "I've never seen the other factors considered and, when brought up during negotiations, contracting officers consistently have declined to consider them.") Sure, alternate approaches exist; but they are (in my experience) rarely, if ever, used.
  13. It's been pointed out to me before that the Weighted Guidelines don't incentivize early delivery. A contractor that can deliver a satisfactory product six months early is not entitled to receive any more profit than a contractor that promises to deliver on time. So much for "speed of relevance"
  14. Federal Publications Seminars and Public Contracting Institute are two that come to mind. There are also individual trainers/consultants who will customize a course to meet a particular contractor's needs. (Hi.)
  15. Increasing PALT is a symptom, not the disease
  16. Fascinating discussion (to me) because I'm always interested in whether or not a contractor can escape liability under the False Claims Act by claiming it was making a reasonable interpretation of an ambiguous regulation or other requirement when it prepared and submitted its invoices. This discussion seems to support the notion that the rule is, if not patently ambiguous, at least so dense as to require an expert (probably a top-notch government contracts attorney) to help the contractor chart a compliant course.
  17. 1. What is the purpose of acquiring property if the property will arrive after the PoP date ... which I assume is the date that the parties mutually agreed performance would have been completed and all deliveries made. I mean, if that's right then the property just seems like a big waste of money. 2. If the property is a deliverable under the contract, and the contract is a completion-type, then you don't need an extension BUT your contracting officer may think you haven't performed your duties as promised by the date you promised to perform them.
  18. Echoing what others have said ... Back in the day, a large trash bin went missing from a military base. You know, the big kind that the trucks pick up and empty? Anyway, it was government property in the possession of a contractor. Properly marked as such. The missing bin was quickly located on the other side of the fenceline, in a farmer's field. Filled with [I don't recall, if I ever knew. Let's say "hay".] Our property manager reported it to the base security office as theft of government property. The farmer received a visit from a couple of uniformed security folks. The bin was back on the right side of the fence, emptied and washed clean, within 24 hours.
  19. Fair point. What do you suppose the value of the CDRL item(s) is? Let's assume that they were NSP (not separately priced). Shrug. I'm agreeing with you, basically. I just don't see how the fact pattern I came in with supports a T4D or even a breach damages kind of discussion. I fully agree the CPARS rating would suffer -- and should suffer. Anyway, fun [totally hypothetical] discussion.
  20. Retread, Well, I think the term "physically complete" may be ambiguous. On one hand, everything that was supposed to be delivered was, in fact, delivered, inspected, accepted, and paid for. On the other hand, Vern points out that completion means, essentially, that all obligations have been discharged. Can a contract be physically complete without being complete? Only in government contracting ... Can a contract be terminated for default after all deliveries have been made? It's not like the contractor didn't make progress. I think a court might find such a drastic sanction a bit untenable, but maybe that's my bias showing. Finally, to Vern's latest point -- breach damages -- I think, in my [totally hypothetical] case at least, the government would be hard pressed to prove damages from a few reports that, at best, end up in a Fourth Estate file cabinet somewhere in a Pentagon annex. Thanks for all the input.
  21. Vern, Thank you. This has been very helpful. And while I knew some of your information, I didn't not know it all. As Matthew F. noted, many people (including contracting officers) place an undue emphasis on Period of Performance with respect to what can or cannot be invoiced to a government customer as an allowable contract cost. Your response helped me clarify my position on the matter and gave me solid talking points to take back to [contracting officer]. Finally, for those wondering, my issue was with respect to a supply contract where the item supplied has been inspected/accepted and the associated invoices have been paid. There are a few straggling deliverables (status reports, not tech data), and it has been "suggested" that [contractor] not invoice such costs because they are properly contract close-out costs and should be charged to overhead. I thought I'd throw the issue out and see what came back. As usual, I'm gratified at the responses. Thank you all.
  22. Thank you, Vern. I'm seeking some follow-up information, if you would. What is the purpose of a PoP, if not to signal contract completion to the parties? Why is it important?
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