This is a common misconception within the GOVCON community. While the expectations are clearly less documentation and effort are required than that of a larger dollar value purchase, there is not a magic threshold at which NO documentation of the fair and reasonable price is allowed.
Topics: Compliant Accounting Infrastructure, Incurred Cost Proposal Submission (ICP/ICE), Contracts & Subcontracts Administration, DFARS Business Systems, DCAA Audit Support, Contractor Purchasing System Review (CPSR), Government Regulations, Federal Acquisition Regulation (FAR), Estimating System Compliance
This is the third blog in a three-part series on progress payments for Government contractors. In this blog we will discuss the estimate to complete, and the adjustments needed when there is a projected loss on a contract.
Topics: Compliant Accounting Infrastructure, Contracts & Subcontracts Administration, DFARS Business Systems, Government Regulations, Federal Acquisition Regulation (FAR), Estimating System Compliance
The National Institutes of Health Acquisition and Assessment Center (NITAAC) released its long-awaited Request for Proposal (RFP) for the Chief Information Officer – Solutions and Partners (CIO-SP4) program on May 25, 2021. Phase I of the evaluation of offeror proposals will consist of validation of the offeror’s completed self-scoring sheet and ranking the offerors based on this scoring. Only the highest rated offerors will advance to phase 2 of the evaluation. Accordingly, every point counts!
Topics: Proposal Cost Volume Development & Pricing, DFARS Business Systems, Estimating System Compliance
The FAR establishes that when contracting by negotiation with the Government, the contractor should have an acceptable estimating system. FAR 15.407-5 provides that due to the benefits to both the Government and the contractor in reducing the scope of individual proposal reviews at contractors with an acceptable estimating system, the auditor (likely DCAA) should survey the system and provide a report to all contracting offices and contract administration offices doing substantial pricing activity with the contractor. This is a very open-ended requirement/expectation; therefore, DoD established a structure in the DFARS.
Topics: Contracts & Subcontracts Administration, DFARS Business Systems, DCAA Audit Support, Estimating System Compliance
With a renewed focus on DCAA Estimating System Audits, we share some advice on successfully navigating the process.
Topics: DFARS Business Systems, DCAA Audit Support, Estimating System Compliance
One of the most important parts of a proper response to a Government Solicitation is the Basis of Estimate(s) (BOE). The BOE is a tool that is carefully developed by members of a project team through intricate analysis of the Performance Work Statement (PWS) in order to calculate the total price for the required effort. The BOE must be developed before the pricing can take place so that the pricing team knows the cost elements, which will require pricing. To put it differently, the BOE is an estimate developed to outline a Company’s expected staffing and solutions for the selected Government solicitation. This proposed estimate is combined with detailed explanations and supporting rationale which bolsters the overall conclusion. The BOE needs to be able to show the level of services (proposed labor), the skill mix required, materials, travel, etc., that will be required to deliver what is requested through the solicitation. In order to provide a realistic estimate, technical experts should be utilized in order to appropriately determine the work effort needed. The details in the BOE need to be sufficient for the technical evaluator (government or prime contractor) to understand the rationale used, the source of the underlying data, the detailed calculations involved, and the basis for any complexity factors.
Topics: Compliant Accounting Infrastructure, Proposal Cost Volume Development & Pricing, Estimating System Compliance