94-6901. Federal Acquisition Regulation; Subcontract Proposal Audits

[Federal Register Volume 59, Number 59 (Monday, March 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-6901]


[Federal Register: March 28, 1994]


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DEPARTMENT OF DEFENSE
48 CFR Part 15

[FAR Case 92-2]


Federal Acquisition Regulation; Subcontract Proposal Audits

AGENCIES: Department of Defense (DOD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council are proposing amendments to the Federal 
Acquisition Regulation (FAR) to add two additional examples of when 
field pricing support audits of subcontract proposals may be 
appropriate. This regulatory action was not subject to Office of 
Management and Budget review pursuant to Executive Order No. 12866 
dated September 30, 1993.

DATES: Comments should be submitted on or before May 27, 1994 to be 
considered in the formulation of a final rule.

ADDRESSES: Interested parties should submit written comments to: 
General Services Administration, FAR Secretariat (VRS), 18th & F 
Streets, NW., room 4035, Attn: Ms. Beverly Fayson, Washington, DC 
20405.
    Please cite FAR case 92-2 in all correspondence related to this 
case.

FOR FURTHER INFORMATION CONTACT:
Jeremy F. Olson at [phone] in reference to this FAR case. For 
general information, contact the FAR Secretariat, room 4035, GS 
Building, Washington, DC 20405, [phone]. Please cite FAR case 
92-2.

SUPPLEMENTARY INFORMATION:

A. Background

    The DOD Inspector General's final report of December 11, 1991, 
Review of Actions Taken on 42 Contractor Estimating System Cited as 
Inadequate by the General Accounting Office (Report No. AFU 92-1), 
found that estimating system deficiencies warrant additional management 
attention. Expanded regulatory guidance governing contracting officer's 
requests for assist audits of subcontractor cost proposals was 
recommended.

B. Regulatory Flexibility Act

    The proposed rule is not expected to have a significant economic 
impact on a substantial number of small entities within the meaning of 
the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because most 
contracts awarded to small entities are awarded on a competitive, 
fixed-price basis and certified cost or pricing data and field pricing 
support are not required. An Initial Regulatory Flexibility Analysis 
has, therefore, not been performed. Comments from small entities 
concerning the affected FAR subpart will be considered in accordance 
with section 610 of the Act. Such comments must be submitted separately 
and should cite 5 U.S.C. 601, et seq., FAR case 92-2, in 
correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the proposed 
changes to the FAR do not impose recordkeeping or information 
collection requirements, or collections of information from offerors, 
contractors, or members of the public which require the approval of the 
Office of Management and Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Part 15

    Government procurement.
Albert A. Vicchiolla,
Director, Office of Federal Acquisition Policy.

    Therefore, it is proposed that 48 CFR part 15 be amended as set 
forth below:

PART 15--CONTRACTING BY NEGOTIATION

    1. The authority citation for 48 CFR part 15 continues to read as 
follows:

    Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

    2. Section 15.806-3 is amended in paragraph (a)(3) by removing the 
word ``or''; in paragraph (a)(4) by removing the period and inserting a 
semicolon in its place; and adding paragraphs (a)(5) and (a)(6) to read 
as follows:


Sec. 15.806-3  Field pricing reports.

    (a) * * *
    (5) The contractor or higher tier subcontractor has been cited for 
having significant estimating system deficiencies in the area of 
subcontract pricing, especially the failure to perform adequate cost 
analyses of proposed subcontract costs or to perform subcontract 
analyses prior to negotiation of the prime contract with the 
Government; or
    (6) A lower tier subcontractor has been cited as having significant 
estimating system deficiencies.
* * * * *
[FR Doc. 94-6901 Filed 3-25-94; 8:45 am]
BILLING CODE 6820-34-M