DFARS 252.242-7006 Accounting System Administration
Prescribed in 242.7503 | |
Effective Date: | 1 February 2012 |
Clause or Provision: | Clause |
Provision or Clause Number: | S 252.242-7006 Accounting System Administration |
Principle Type And/Or Purpose of Contract: | |
Required: | |
Applicable: | |
Optional: | |
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ProcurementType: | |
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Prescription Overview: |
PrescriptionUse the clause at 252.242-7006, Accounting System Administration, in solicitations and contracts when contemplating—
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Clause Overview: |
ClauseACCOUNTING SYSTEM ADMINISTRATION (FEB 2012)(a) DefinitionsAs used in this clause— (1) “Acceptable accounting system” means a system that complies with the system criteria in paragraph (c) of this clause to provide reasonable assurance that—
(2) “Accounting system” means the Contractor’s system or systems for accounting methods, procedures, and controls established to gather, record, classify, analyze, summarize, interpret, and present accurate and timely financial data for reporting in compliance with applicable laws, regulations, and management decisions, and may include subsystems for specific areas such as indirect and other direct costs, compensation, billing, labor, and general information technology. (3) “Significant deficiency” means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon information produced by the system that is needed for management purposes.
(b) GeneralThe Contractor shall establish and maintain an acceptable accounting system. Failure to maintain an acceptable accounting system, as defined in this clause, shall result in the withholding of payments if the contract includes the clause at 252.242-7005, Contractor Business Systems, and also may result in disapproval of the system.
(c) System criteriaThe Contractor’s accounting system shall provide for— (1) A sound internal control environment, accounting framework, and organizational structure;
(d) 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.
Final Determination(e) 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.
(f) Withholding paymentsIf the Contracting Officer makes a final determination to disapprove the Contractor’s accounting 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. |
Important Notes/Requirements: | |
Subcontract Threshold: | |
Incorporated by Reference: | Yes |
Uniform Contract Format: | |
Editor: | Marshall |
Personal notes.