Cost Reimbursement Contracts Far

In a repayable contract, the government and the contract set target costs. In this way, a contractor has a certain expectation when performing the contract. Contracting authorities should use reimbursable contracts where the requirements are not defined to such an extent that a fixed-price contract is not feasible. The procuring entity shall document the choice of source in order to justify the reasons for using a refundable procurement. See additional far provisions. Definition: A reimbursement contract is a contract in which all eligible expenses of the contractor are covered up to an agreed limit and an additional payment for a profit. 2. Where it is envisaged to examine a cost-reimbursable research and development contract with an educational institution or non-profit organisation which does not provide for fees or other payments in excess of costs and which is not a cost-sharing contract, and the contract staff considers that it is not necessary to withhold part of the eligible costs, the contract agent shall use the clause with his deputy I. A The contract for reimbursement of costs, on the other hand, is concluded when the contracting parties are not entirely sure of the costs of the services. (a) Description.

A cost-sharing contract is a cost-reimbursement contract in which the contractor does not receive a fee and is reimbursed only an agreed portion of its eligible costs. (1) The completed form shall describe the scope of work, indicating a specific purpose or purpose and a final product. This form of contract usually requires the contractor to complete and deliver the specified final product (e.g. B a final report on the research that achieves the objective or objective) within the estimated cost, if possible, as a condition of paying the full fixed costs. However, in the event that the work cannot be completed within the estimated cost, the government may require more effort without increasing the cost, provided that the government increases the estimated cost. (d) the forms to be completed and the deadlines. A more expensive fixed-cost contract can take one of two basic forms – conclusion or duration. (4) Before the contract or contract is awarded, sufficient State resources are available for the award and management of a contract which is not fixed at a fixed price (see 7.104(e)).

This includes appropriate government oversight during implementation in accordance with section 1.602-2 to provide reasonable assurance that effective methods and cost controls are in place. (a) Description. A fixed-cost contract is a reimbursement contract that provides for the payment of a negotiated royalty to the contractor, which is determined at the beginning of the contract. Fixed costs do not vary with actual costs, but may be adjusted due to changes in the work to be performed under the contract. This type of contract allows contracts to be awarded for efforts that might otherwise pose too much risk to contractors, but provides the contractor with a minimum incentive to control costs. (2) A fixed-cost plus contract should not normally be used for the development of key systems (see Part 34) once the preliminary exploration, studies and risk mitigation measures have revealed a high degree of likelihood that the development will be feasible and the government has set reasonably firm performance targets and timelines. Fixed Cost Plus Cost (CPFF) contract: This type of government contract has refundable terms when the agency reimburses the contractor for eligible government costs. These eligible costs are specified in the terms of the contract.

The contract also provides for a fixed profit amount. In the case of repayment projects, the government assumes some risk of the final contract price. However, as with all government contracts, prices must be reasonable. The types of reimbursement of contracts provide for the payment of reimbursable expenses incurred to the extent prescribed in the contract. These contracts shall specify an estimate of the total cost for the purposes of the commitment and the setting of a ceiling which the contractor may not exceed without the consent of the procuring entity (except at its own risk). (b) enforcement. A cost contract may be suitable for research and development work, in particular with non-profit educational institutions or other non-profit organisations. In federally contracted enterprises, the following types of cost reimbursement contracts, also known as cost-plus contracts, are confronted. These are: (2) The term form describes the scope of services in general and requires the contractor to make some effort for a specified period of time. If performance is deemed satisfactory by the Government, the fixed fee is payable after the end of the agreed period if the contractor declares that the effort specified in the contract has been devoted to the performance of the contract work. The extension for other periods of service is a new acquisition that involves new cost and fee agreements. The government uses this type of refundable contract when paying the contractor`s eligible costs, but a significant portion of the payment is focused on the contractor`s established criteria and performance expectations.

A repayment contract requires the contractor to negotiate an « estimated total cost » and the payment of a fixed royalty to the contractor. The estimated total cost is a limitation of the cost of the contract that the contractor cannot exceed, with the exception of the risk of non-reimbursement. Any repayment contract must include a « cost limitation » or « funds limit » clause that limits the government`s liability if the contractor exceeds the estimated total cost. (a) (1) The Contractor shall insert clause 52.216-7, Eligible Costs and Payment, in applications and contracts when considering a cost reimbursement contract or a time and material contract (other than a contract for a commercial object). If the contract is a time and material contract, clause 52.216-7 in conjunction with clause 52.232-7 applies, but only to the part of the contract that provides for the reimbursement of materials (as defined in clause 52.232-7) at actual cost. In addition, clause 52.216-7 does not apply to hourly employment contracts. (ii) adequate monitoring of the status during implementation to provide reasonable assurance that effective methods and cost controls are applied. (2) The uncertainties associated with the performance of the contract do not allow costs to be estimated with sufficient precision to use any type of fixed-price contract. Costs plus incentive fees Public procurement: This type of public contract has conditions under which the contracting authority reimburses the contractor for the eligible costs defined in the terms of the contract.

The incentive payment occurs when the contract meets certain performance targets. (b) enforcement. A cost-sharing contract may be invoked if the contractor agrees to cover part of the costs in anticipation of a significant compensation gain. (b) The contractor shall document the justification for the choice of the type of procurement in the written procurement plan and ensure that the plan is approved and signed at least one level above the contracting authority (see 7.103(j) and 7.105); (i) at least one representative of the contracting authority (DA) qualified in accordance with Article 1.602-2 has been appointed before the award of the contract or contract; and (4) The term form may only be used if the contractor is required by the contract to make a certain effort within a certain period of time. .