[Federal Register Volume 61, Number 120 (Thursday, June 20, 1996)]
[Rules and Regulations]
[Pages 31655-31656]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14534]
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DEPARTMENT OF DEFENSE
48 CFR Part 31
[FAC 90-39; FAR Case 93-020; Item XIX]
RIN 9000-AF99
Federal Acquisition Regulation; Records Retention
AGENCIES: Department of Defense (DOD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
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SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council have agreed on a final rule to amend
the Federal Acquisition Regulation (FAR) to explicitly state that
contractors must maintain adequate cost records in order to be
reimbursed for all claimed costs. This regulatory action was subject to
Office of Management and Budget review under Executive Order 12866,
dated September 30, 1993. It is not a major rule under 5 U.S.C. 804.
EFFECTIVE DATE: August 19, 1996.
FOR FURTHER INFORMATION CONTACT: Mr. Jeremy F. Olson at (202) 501-3221
in reference to this FAR case. For general information, contact the FAR
Secretariat, Room 4037, GS Building, Washington, DC 20405 (202) 501-
4755. Please cite FAC 90-39, FAR case 93-020.
[[Page 31656]]
SUPPLEMENTARY INFORMATION:
A. Background
The guidance for determining cost allowability at FAR 31.201-2
previously did not explicitly state that contractors must maintain
adequate cost records in order to be reimbursed for all claimed costs
nor did it specifically state that the contracting officer has the
authority to disallow costs which are determined to be inadequately
supported. This requirement and authority have, heretofore, been
considered to be implicit in the cost principles. However, the Councils
are revising the FAR to explicitly address these issues because the
Office of Federal Procurement Policy SWAT Team on Civilian Agency
Contracting in its report of December 3, 1992, ``Improving Contracting
Practices and Management Controls on Cost-Type Federal Contracts,''
found that agencies were having difficulty because the FAR was silent
on these issues. A new paragraph (d) is added to FAR 31.201-2 to
explicitly state that costs claimed for reimbursement must be
adequately supported and that the contracting officer may disallow
costs which are inadequately supported. A proposed rule was published
in the Federal Register at 59 FR 47776 on September 16, 1994. After
evaluation of public comments, the Councils agreed to convert the
proposed rule to a final rule without further change.
B. Regulatory Flexibility Act
The Department of Defense, the General Services Administration, and
the National Aeronautics and Space Administration certify that this
final rule will not 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
the cost principles do not apply. No comments were received on the
impact of this rule on small entities during the public comment period.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the 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 31
Government procurement.
Dated: June 4, 1996.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.
Therefore, 48 CFR Part 31 is amended as set forth below:
PART 31--CONTRACT COST PRINCIPLES AND PROCEDURES
1. The authority citation for 48 CFR Part 31 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 31.201-2 is amended by adding paragraph (d) to read as
follows:
31.201-2 Determining allowability.
* * * * *
(d) A contractor is responsible for accounting for costs
appropriately and for maintaining records, including supporting
documentation, adequate to demonstrate that costs claimed have been
incurred, are allocable to the contract, and comply with applicable
cost principles in this subpart and agency supplements. The contracting
officer may disallow all or part of a claimed cost which is
inadequately supported.
[FR Doc. 96-14534 Filed 6-19-96; 8:45 am]
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