32.007
Contract financing payments
Contract financing payments are generally due within 30 days of a proper request, but no interest is paid for late payments and strict compliance with submission requirements is essential.
Overview
FAR 32.007 establishes the rules and timelines for making contract financing payments, such as progress payments or advance payments, to contractors. It sets a standard due date of 30 days after the designated billing office receives a proper contract financing request, unless agency policies specify otherwise or a shorter period is justified. The section also clarifies exceptions, such as when audits are required, and outlines requirements for proper submission and annotation of financing requests. Importantly, it states that interest penalties do not apply to delayed contract financing payments.
Key Rules
- Payment Due Date
- Payments are generally due within 30 days of receipt of a proper contract financing request, unless agency policy or contract terms specify otherwise.
- Audit Exception
- If an audit or review is needed, payment may be delayed beyond the standard due date.
- Agency Discretion on Payment Periods
- Agency heads can set shorter payment periods (not less than 7 days), but never longer than 30 days.
- Advance Payments and Loans
- For non-recurrent requests (like advance payments), payment is made per contract terms or as directed by the contracting officer.
- Proper Requests and Corrections
- Requests must comply with contract terms; defects must be corrected as directed.
- Date Annotation
- Both billing and payment offices must annotate the date each request is received.
- No Interest Penalties
- No interest is paid for late contract financing payments.
Responsibilities
- Contracting Officers: Ensure contract terms specify financing request requirements and direct corrections as needed.
- Contractors: Submit proper financing requests and correct any defects as directed.
- Agencies: Set payment periods within allowed limits, annotate receipt dates, and ensure compliance with audit requirements.
Practical Implications
- This section ensures timely contract financing payments while allowing flexibility for audits and agency-specific needs. Contractors must pay close attention to submission requirements and deadlines, as improper requests or delays in correction can impact payment timing. Agencies must balance prompt payment with necessary oversight, and contractors should not expect interest for late financing payments.