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CAS Applicability - IDIQ level or at individual TO level?


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5 hours ago, Retreadfed said:

What is the basis for your statement concerning "the total estimated value of all orders"?

AKA total IDIQ value/contract maximum.  It was intended to address stuff like the $7.5M CAS thresholds.  

I think it's a totally fair statement to say that CAS is applied at the task order level, but I also think that the determination to do so is in the IDIQ.  It's sort of like how you make a SB set-aside determination at the IDIQ level even though you are actually setting aside the TOs.

5 hours ago, here_2_help said:

The contracting officer and the contractors all know that the likely value of the awards to each is much less than $100 Million.

Assuming the maximum order value on a $100M IDIQ is over $7.5M, that would practically dictate CAS coverage. It's definitely not an exact science, or a science at all for that matter, but I've never heard of CAS coverage being a big deal to any vendor proposing on a $100M federal contract.  Aren't CAS basically GAAP anyway?*  That's not rhetorical; I honestly don't know for sure.

 

(* I believe this construction is bizarre yet grammatically correct however I am also a product of the American public school system)

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52 minutes ago, REA'n Maker said:

AKA total IDIQ value/contract maximum.  It was intended to address stuff like the $7.5M CAS thresholds.  

I think it's a totally fair statement to say that CAS is applied at the task order level, but I also think that the determination to do so is in the IDIQ.  It's sort of like how you make a SB set-aside determination at the IDIQ level even though you are actually setting aside the TOs.

Assuming the maximum order value on a $100M IDIQ is over $7.5M, that would practically dictate CAS coverage. It's definitely not an exact science, or a science at all for that matter, but I've never heard of CAS coverage being a big deal to any vendor proposing on a $100M federal contract.  Aren't CAS basically GAAP anyway?*  That's not rhetorical; I honestly don't know for sure.

 

(* I believe this construction is bizarre yet grammatically correct however I am also a product of the American public school system)

31.201-2 Determining allowability.

(a) A cost is allowable only when the cost complies with all of the following requirements:

(1) Reasonableness.

(2) Allocability.

(3) Standards promulgated by the CAS Board, if applicable, otherwise, generally accepted accounting principles and practices appropriate to the circumstances.

(4) Terms of the contract.

(5) Any limitations set forth in this subpart.

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11 hours ago, here_2_help said:

The author is making a analogy. As with all analogies, it is imperfect.

But the first sentence is just plain wrong. "Technically", an IDIQ contract is a contract. Period. It doesn't have to be pre-priced to be a contract. Regardless of whether an order is ever placed, it's a contract. There's an offer, acceptance, consideration--the whole shebang. 

A BOA is not a contract. There's no exchange of enforceable promises.

I think the author knows this but didn't explain it well.

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10 hours ago, Don Mansfield said:

It doesn't have to be pre-priced to be a contract.

I agree.  FAR 16.505(b)(3) states, "If the contract did not establish the price for the supply or service, the contracting officer must establish prices for each order using the policies and methods in subpart 15.4."  If a basic IDIQ contract has to be pre-priced to qualify as a contract, the language at FAR 16.505(b)(3) does not make a lot of sense.

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On 6/7/2023 at 11:01 AM, here_2_help said:

But that's not the current state of things. Instead, CAS coverage is determined based on the total value of the ID/IQ contract awarded.

Is there a statute, regulation or contract clause that says this or is this based on DCAA's view of things?

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18 minutes ago, Retreadfed said:

Is there a statute, regulation or contract clause that says this or is this based on DCAA's view of things?

Based on DCAA's view

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4 hours ago, Retreadfed said:

Are you equating the contract maximum with "the final anticipated dollar value of the action" as stated in FAR 1.108(c)?

In 1.108(c) context, my reference was closer to "ceiling price".  "Maximum" is probably more applicable to quantities so not the best word choice. 

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18 hours ago, Don Mansfield said:

@C CulhamCan you find this?

Sorry, I can not.   I spent some time looking and could not find where such guidance was issued.  In fact everything I read indicates the following quote still stands true.  Yes it is dated (2018) but by my research and as evidenced by this thread the matter of confusion regarding IDIQ's (IDC) remains today. 

"There is no DoD CAS Working Group guidance concerning IDCs which, unlike basic agreements, BOAs, and BPAs, are considered to be contracts. IDCs include definite-quantity contracts, requirements contracts, and indefinite-quantity contracts (see FAR Subpart 16.5)."

Ref: https://discover.dtic.mil/wp-content/uploads/809-Panel-2019/Volume2/Recommendation_30.pdf

 

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If in DoD does this muddy the water even more or does it help?

PGI 215.406-3 Documenting the negotiation. (D) If an initial indefinite-delivery indefinite-quantity (IDIQ) task or delivery order contract contemplates issuance of task or delivery orders that will invoke negotiated rates or values from the basic contract, then the business clearance record for the basic IDIQ contract shall be uploaded if the estimated value of the contract (e.g. ceiling price) exceeds the prescribed dollar threshold. To the extent individual task or delivery orders entail a negotiation (i.e. did not simply incorporate prices established at the basic contract level), a business clearance record for the individual task or delivery orders that exceed the prescribed dollar thresholds shall be uploaded to CBAR.

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Okay, I will stop posting with this entry as I realize I am all over the board with references.   I will say that I took a different approach in my research and used TINA as my search topic.   It lead me to the PGI I just posted and then to this (see below).   I looked through the thread and did not see this as a reference but I will admit I did not read the references linked in posts to see if this was present.  All for the good of the order I hope.....

"In the case of IDIQ contracts, it is commonly understood that it is the estimated total value of orders for the specified period at the time of contract award, as well as the individual value of any subsequent discrete orders, to which the TINA thresholds apply."

Reference - https://www.federalregister.gov/documents/2010/03/19/2010-5986/federal-acquisition-regulation-far-case-2008-012-clarification-of-submission-of-cost-or-pricing-data

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