The key here is to make this analysis available to the ACO or the cost monitor and auditor. It will also help support the ACO`s requirement, monitor and track the FPRA, and ensure that the FPRA is up-to-date, accurate and complete. (e) The CCO may negotiate ongoing updates of the FPRA. The FPRA will provide specific conditions of notification, application and data requirements for systematic monitoring to ensure the validity of tariffs In each price proposal, contractors will have to explicitly describe the RCPs that are subject to the tariffs. Contractors must also identify the most recent cost or price data that has already been transmitted in accordance with the agreement. Contractor cost tracking provides direction to DCMA-ACOs when a cost tracking plan is needed, including setting Forward Pricing Rate Recommendations (FPRR) or Forward Pricing Rate Agreement (FPRA). The DCMA 2201-01 manual of 14 February 2019 translates the DFARS-IGP. in specific guidelines for ACOs (interest rates are discussed in Section 3, Pricing Advice). Section 3.1 provides that the FPRR or FPRA is only necessary if the contractor`s turnover is expected to exceed $200 million in the following fiscal year (based on costs incurred or costs negotiated on the basis of expected costs). If this is not necessary, the ACO may define an FPRR or FPRA on the basis of a significant volume of negotiation, a customer request or a contractor request. However, to do so, the CCO must complete and obtain approval of a written decision. If your turnover is less than $US 200 million and you think a tariff agreement would be beneficial, you will need to write your application in a format that will allow the COA to cut and insert to establish its written disposition.
Most ACOs have a significant workload and many are new to their role in the acquisition process. It is therefore important to support the ACO as much as possible. There is a lot of confusion and frustration on behalf of a contractor when it comes to advance rate agreements (FPRP) and forward rate agreements (FPRA). This confusion and frustration of the simple lack of direction given to this process in the FAR. On this blog, we`re putting forward pricing rules and guidelines in place to help contractors better understand the process and ease some of the frustrations and issues we often see. .