30.607
Subcontract administration
CFAOs must communicate CAS price adjustments and noncompliance determinations up the subcontract chain, and higher-tier CFAOs cannot alter lower-tier decisions, with remedies for noncompliance enforced at the prime contractor level.
Overview
FAR 30.607 addresses the administration of subcontracts under the Cost Accounting Standards (CAS) when a negotiated CAS price adjustment or a determination of noncompliance is required at the subcontract level. It outlines the responsibilities of the Cognizant Federal Agency Official (CFAO) in communicating determinations and negotiation outcomes up the subcontracting chain and restricts higher-tier CFAOs from altering lower-tier determinations. Additionally, it specifies that if a subcontractor refuses to submit required cost impact proposals (GDM or DCI), remedies must be pursued at the prime contractor level.
Key Rules
- CFAO Communication Requirement
- The CFAO for the subcontractor must provide copies of negotiation memoranda or noncompliance determinations to the CFAO for the next higher-tier contractor.
- No Alteration of Lower-Tier Determinations
- Higher-tier CFAOs are prohibited from changing determinations made by lower-tier CFAOs.
- Remedies for Subcontractor Non-Submission
- If a subcontractor refuses to submit a General Dollar Magnitude (GDM) or Detailed Cost Impact (DCI) proposal, corrective action is taken at the prime contractor level.
Responsibilities
- Contracting Officers: Ensure proper communication and enforcement of CAS-related determinations and adjustments at all subcontract levels.
- Contractors: Facilitate the flow of required documentation and comply with CAS administration requirements.
- Agencies: Oversee CFAO actions and ensure remedies are implemented when subcontractors do not comply.
Practical Implications
- This section ensures transparency and consistency in CAS administration throughout the subcontracting chain.
- It prevents higher-tier contractors or CFAOs from overriding lower-tier CAS determinations, maintaining integrity in the process.
- Noncompliance or refusal to submit required proposals by subcontractors can result in remedies being enforced at the prime contractor level, increasing prime contractor risk and responsibility.