CONTRACT PRICING: Threshold for Analysis of Subcontract Proposals Not Clear
Abstract
This report discusses the Department of Defenses (DOD) management of subcontracts. It discusses whether procurement officials make consistent and uniform interpretations of the dollar threshold at which prime contractors are required to submit analyses of cost or pricing data for prospective subcontracts-subcontract proposals that are not negotiated before prime contract negotiations with the government are completed. Subcontracts frequently comprise more than 50 percent of prime contract prices and are often not negotiated until after DOD has negotiated the prime contract. Accordingly, the Federal Acquisition Regulation (FAR) specifies actions that contractors must take to help ensure the fairness and reasonableness of such prospective subcontract proposals. For proposals priced at or above dollar thresholds, the FAEZ requires prime contractors to (1) obtain and analyze cost or pricing data that supports the proposals and (2) submit the analyses to the government before an agreement is reached on the prime contract price.
Document Details
- Document Type
- Technical Report
- Publication Date
- Mar 20, 1992
- Accession Number
- AD1123039
Entities
Organizations
- United States Government Accountability Office