DCAA Clarifies Requirements for Unilateral Cost Adjustments
DCAA issued supplemental guidance intended to “clarify” its recent guidance issued June 17 addressing government requirements to unilaterally adjust contract billings. The earlier guidance instructed auditors who are developing unilateral rate recommendations for high risk contractors to decrement total contract costs by 20 percent in the absence of recent relevant historical cost data and to where relevant data existed, to use the data to develop recommended rates. A high risk contractor is one who fails to submit its final indirect cost proposal within six months after it is due and has not received a written extension from the CO.
The new guidance stresses the development of recommended rates should be applied not only to physically completed contracts but also to active contracts. The guidance states that if the contractor does not submit an adjustment voucher on active and physically competed contracts “within a reasonable time”, usually considered 30 days after the CO’s unilateral determination, then the auditor should issue a DCAA Form 1 to suspend excess costs (MRD-02-OWD-052(R).
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