In March 2016, the National Institute of Health (NIH) issued a solicitation for “IT solutions and services. Leader Communications was one of the bidders but was excluded from further consideration for failing to submit verification of an adequate cost accounting system from DCAA (Defense Contract Audit Agency).
A former contracting official with GSA (General Services Administration) and her husband pleaded guilty yesterday to engaging in a nepotism scheme in which they conspired to fraudulently obtain employment from the U.S. Government and private federal contractors with which the (former) GSA official had some form of official oversight. The Government calls this a $200 thousand fraud.
Source: PNWC’s Government Contracting Update: Guy Just Can’t Get a Decent Job – Even With Wife’s Assistance
Materials, supplies, and services that are sold or transferred between any divisions, subdivisions, subsidiaries, or affiliates under common control must be made on the basis of cost incurred with one exception; transfers may be made at price when it is the established practice when it is the established practice of the transferring organization to price inter-organizational transfers at other than cost for commercial work and the price of the item being transferred is based on adequate price competition, is set by law or regulation, is a commercial item, or a waiver has been granted. Additionally, the contracting officer cannot have already determined the price to be unreasonable (see FAR 31.205-26(e)).
Source: PNWC’s Government Contracting Update: Inter-divisional Transfers at Price
Cost Accounting Standard (CAS) 404 establishes criteria for determining the acquisition costs of tangible assets which are to be capitalized. It requires contractors to capitalize the acquisition costs of tangible assets in accordance with a written policy that is reasonable and consistently applied. We have detailed the essential requirements of CAS 404 in a previous post that can be read here.
Source: PNWC’s Government Contracting Update: Is a Lease Really an Intangible Asset?
There have been inconsistencies among contractors and Government oversight agencies in applying the requirements of the FAR cost principle on Bid and Proposal Costs (see FAR 31.205-18).
Source: PNWC’s Government Contracting Update: When Can Bid and Proposal (B&P) Spending Begin?
Last November we highlighted an ASBCA (Armed Services Board of Contract Appeals) ruling from August 29, 2016 that CAS 404, Capitalization of Tangible Assets) does not apply to capital leases. This ruling caught us by surprise as almost everyone in Government contracting circles believed otherwise and acted on that premise in determining allowable costs (depreciation) on Government contracts. Read it here.
Source: PNWC’s Government Contracting Update: Going to Court? Give it Your Best the First Time Around
Contractor team arrangements as used in Government contracting, are where (i) two or more companies form a partnership or joint venture to act as a potential prime contractor or (ii) a potential prime contractor agrees with one or more other companies to have them act as its subcontractors under a specified Government contract or acquisition program.
Source: PNWC’s Government Contracting Update: Contractor Team Arrangements
The U.S. Court of Federal Claims dismissed a company’s OCI (Organizational Conflict of Interest) claim related to the award of a contract by the Army because it effectively waived its claim by not raising it before contract award.
Source: PNWC’s Government Contracting Update: Some Claims Must Be Raised Before Contract Award
Early on in our blog publication (February 2010), we discussed DoD’s implementation of the voluntary disclosure program – an opportunity for contractors to self-disclose instances of contract “wrong-doing”. You can read our initial post on the subject here and although that information is still current, we were reminded of it again after the the Justice Department announced a $1.8 million recovery under the program.
The President issued an Executive Order yesterday that requires every executive agency to conduct an internal review of how their funds are being wasted or abused and to recommend changes they can pursue to operate more efficiently. According to the President, “There is duplication and redundancy everywhere. Billions and billions of dollars are being wasted on activities that are not delivering results.”