DFARS Forward Pricing Rate Proposal Adequacy Checklist

By: Kelly Lynch

On May 16, 2013, the Department of Defense (DoD) issued a proposed revision to the Defense Federal Acquisition Regulations System (DFARS) that would require contractors to submit a forward pricing rate proposal adequacy checklist with forward pricing rate proposals. Similar to the DFARS Proposal Adequacy Checklist implemented on March 28, 2013, this checklist is intended to ensure that offerors take responsibility for submitting thorough, accurate, complete, and current proposals.

The DoD indicated that this checklist will only affect a small percentage of Government contractors who are required to submit a forward pricing rate proposal, as set forth at FAR 42.1701(a). The contents of the checklist address the following requirements:

  • FAR 15.407-1: Defective Certified Cost or Pricing Data
  • FAR 15.408, Table 15-2: Instructions for Submitting Cost/Price Proposals When Cost or Pricing Data Are Required
  • DFARS 252.215-7002(d)(4): Cost Estimating System Requirements including:

(iv) Identify and document the sources of data and the estimating methods and rationale used in developing cost estimates and budgets.

(viii) Protect against cost duplication and omissions.

(xi) Integrate data and information available from other management systems.

(xiv) Provide procedures to update cost estimates and notify the Contracting Officer in a timely manner throughout the negotiation process.

The checklist includes 27 items within the following categories: general instructions, direct labor, indirect rates, cost of money, and other. The checklist includes many of the same areas included in the DFARS Proposal Adequacy Checklist; it is suspected that the comments received will be similar to those provided for that checklist, which stated that the rule was duplicative to the Defense Contract Audit Agency’s existing checklists and would result in increased costs and efforts to both the Government and contractors. Comments on the checklist will be accepted on or before July 15, 2013.

Click here for the full text of the proposed rule and the proposed checklist.

The views expressed in this article are those of the authors and do not necessarily reflect the position or policy of Berkeley Research Group, LLC.