DFARS 252.215-7002 - Cost Estimating System Requirements
Prescribed in 215.408(2) | |
Effective Date: | 1 December 2012 |
Clause or Provision: | Clause |
Provision or Clause Number: | S 252.215-7002 - Cost Estimating System Requirements |
Principle Type And/Or Purpose of Contract: | |
Required: | |
Applicable: | |
Optional: | |
Subject: | |
ProcurementType: | Sole Source |
Contract Threshold: | 0 |
Prescription Overview: |
Prescription(2) Use the clause at 252.215-7002, Cost Estimating System Requirements, in all solicitations and contracts to be awarded on the basis of certified cost or pricing data. |
Clause Overview: |
Clause252.215-7002 Cost Estimating System Requirements[1]. As prescribed in 215.408(2), use the following clause: COST ESTIMATING SYSTEM REQUIREMENTS (DEC 2012) (a) DefinitionsAcceptable Estimating SystemMeans an estimating system that complies with the system criteria in paragraph (d) of this clause, and provides for a system that— (1) Is maintained, reliable, and consistently applied; (2) Produces verifiable, supportable, documented, and timely cost estimates that are an acceptable basis for negotiation of fair and reasonable prices; (3) Is consistent with and integrated with the Contractor’s related management systems; and (4) Is subject to applicable financial control systems. Estimating systemMeans the Contractor's policies, procedures, and practices for budgeting and planning controls, and generating estimates of costs and other data included in proposals submitted to customers in the expectation of receiving contract awards. Estimating system includes the Contractor's: (1) Organizational structure; (2) Established lines of authority, duties, and responsibilities; (3) Internal controls and managerial reviews; (4) Flow of work, coordination, and communication; and (5) Budgeting, planning, estimating methods, techniques, accumulation of historical costs, and other analyses used to generate cost estimates. Significant DeficiencyMeans a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon data and information produced by the system that is needed for management purposes. (b) GeneralThe Contractor shall establish, maintain, and comply with an acceptable estimating system. (c) ApplicabilityParagraphs (d) and (e) of this clause apply if the Contractor is a large business and either— (1) In its fiscal year preceding award of this contract, received Department of Defense (DoD) prime contracts or subcontracts, totaling $50 million or more for which certified cost or pricing data were required; or (2) In its fiscal year preceding award of this contract—
(d) System Requirements(1) The Contractor shall disclose its estimating system to the Administrative Contracting Officer (ACO), in writing. If the Contractor wishes the Government to protect the data and information as privileged or confidential, the Contractor must mark the documents with the appropriate legends before submission. (2) An estimating system disclosure is acceptable when the Contractor has provided the ACO with documentation that—
(3) The Contractor shall—
(4) The Contractor’s estimating system shall provide for the use of appropriate source data, utilize sound estimating techniques and good judgment, maintain a consistent approach, and adhere to established policies and procedures. An acceptable estimating system shall accomplish the following functions:
differences.
(e) Significant Deficiencies(1) The Contracting Officer will provide an initial determination to the Contractor, in writing, of any significant deficiencies. The initial determination will describe the deficiency in sufficient detail to allow the Contractor to understand the deficiency. (2) The Contractor shall respond within 30 days to a written initial determination from the Contracting Officer that identifies significant deficiencies in the Contractor's estimating system. If the Contractor disagrees with the initial determination, the Contractor shall state, in writing, its rationale for disagreeing. (3) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the Contracting Officer’s final determination concerning—
Contracting Officer's Final Determination(f) If the Contractor receives the Contracting Officer’s final determination of significant deficiencies, the Contractor shall, within 45 days of receipt of the final determination, either correct the significant deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the significant deficiencies. (g) Withholding PaymentsIf the Contracting Officer makes a final determination to disapprove the Contractor’s estimating system, and the contract includes the clause at 252.242-7005, Contractor Business Systems, the Contracting Officer will withhold payments in accordance with that clause. Related LinksDFAR 215.407-5 - Estimating Systems
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Important Notes/Requirements: | |
Subcontract Threshold: | 0 |
Incorporated by Reference: | Yes |
Uniform Contract Format: | |
Editor: | Marshall |
Personal notes.