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Warrant Board Study Cards > Part 16 Contract Types > Flashcards

Part 16 Contract Types Flashcards

1
Q

Two Broad Contract Type Categories

A

Fixed Price and Cost Reimbursement

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2
Q

Risk Allocation to Contract Type

A

Fixed Price - More risk to the contractor

Cost Reimbursement - More risk to the Gov.

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3
Q

Factors to determine Contract Type

A 
Acq History
Competition
Complexity
Urgency
Period of Performance
Adequacy of Contractor's Accounting System
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4
Q

Documenting Contract Type

A

CO Shall document file on contract type. Document in the AP if required.

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5
Q

Cost-Plus-A-Percentage-of-Cost-type

A

SHALL NOT BE USED

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6
Q

FAR 15 Negotiated Contracts

A

Any type or combination

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7
Q

FAR 12 Commerical Contracts

A

Typically FFP or FP with EPA (T&M/LH must be approved one level above PCO if less than 3 years and less than $1M)

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8
Q

FAR 14 Sealed Bids Contracts

A

Shall only be FFP or FFP with EPA

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9
Q

Objective to negotiating contract type

A

it should result in reasonable contractor risk and provide the contractor with the greatest incentive for efficient and economical performance

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10
Q

Fixed Price Contracts

A

FFP, FP w/ EPA, and FPIF

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11
Q

Cost Reimbursement Contracts

A

CPIF, CPAF, and CPFF

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12
Q

FP with EPA

A

Include EPA clauses and be specific on cost covered and the contract value assigned to those costs.

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13
Q

When to use Incentive Contracts

A

when the required supplies or services can be acquired at lower costs by relating the profit or fee to the contractors performance

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14
Q

When to use award fee contracts

A

only used when not effective or feasible to determine obj incentive targets for cost/schedule/tech performance. Must be approved by the SCO.

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15
Q

Incentive Contract Types

A

FPIF, FPI successive targets, FPAF, CPIF, CPAF

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16
Q

What is FPIF

A

specifies target cost, a target profit, a price ceiling and a profit adjustment formula. Negotiated on the outset. When the contractor completes performace, the parties negotiate the final cost and final price is established by applying the formula. When the final cost is less than the target cost then the final profit greath than the target profit.

17
Q

Elements of FPIF

A 
Target Cost
Actual Cost
Target Profit
Ceiling Price
Share Ratio
Point of Total Asumption
18
Q

Steps of FPIF

A
  1. Determine the Underrun or Overrun
  2. Determine Adjusted Profit
  3. Compute FInal Price (only has profit if Final Price is less than ceiling price)
19
Q

What is CPIF

A

provides for initially negotiated fee to be adjusted later by a formula based on the relationship of total allowable costs to total target costs. It specifies a target cost, target fee, minimum and maximum fees and a fee adjustment formula. After contract performance, the fee payble to the contractor is determined by the formula. The formula provides for increases in fee above target fee when total allowable costs are less than target costs.

20
Q

Elements of CPIF

A 
Target cost (allowable)
Target Fee
Min Fee
Max Fee
Share Ratio
21
Q

Steps of CPIF

A
  1. Determine Underrun or Overrun
  2. Determine Adjusted Fee
  3. Compute final price
22
Q

Limitations on CR contracts

A
  • Factors in considering contract type have been considered
  • AP must be approved at least a level above CO
  • Contractor must have an adequate accounting system
  • Gov surveillance resources to track KTR
  • Prohibited on commercial
23
Q

Limitation on Fee

A

6% of estimated construction costs in A&E Efforts
15% for R&D efforts
10% for all other efforts

24
Q

CPFF LOE

A

A variant of CPFF Term

Used as an alternative to T&M for direct support services

25
Q

T&M and LH

A

NOT Fixed Price Contracts. Used when you can’t accurately estimate extent or duration of work or anticipate costs.

26
Q

T&M

A

Time: Direct Labor at specified fixed hourly rates
Material: Direct Materials, subcontracts and ODC

27
Q

Labor Hour

A

contractor does not pay for material

28
Q

How to document T&M and LH

A

D&F if over $10M approved by SCO (over 3 years must be approved by HCA)

29
Q

3 types of IDC

A

Definite Quantity, Indefinite Quantity, and Requirements

30
Q

Requirments

A

No min but we have to buy all requirements for that specific time period

31
Q

IDIQ

A

No obligation to buy any more than the minimum from the contractor for the remaining period

Warrant Board Study Cards (29 decks)

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