32.400
Scope of subpart
FAR 32.400 clarifies that Subpart 32.4 governs advance payments only for non-commercial prime contracts and subcontracts, excluding certain transactions and commercial items.
Overview
FAR 32.400 defines the scope of Subpart 32.4, outlining the policies and procedures for advance payments on prime contracts and subcontracts, except for those transactions specifically excluded in FAR 32.404. It clarifies that this subpart does not apply to commercial advance payments, which are governed by FAR Subpart 32.2. The section sets the boundaries for when and how advance payment rules are applied, ensuring that contracting professionals understand which types of contracts and payments fall under these regulations. This helps agencies and contractors determine the correct regulatory framework for handling advance payments, avoiding misapplication of rules and ensuring compliance with federal acquisition requirements.
Key Rules
- Applicability to Advance Payments
- This subpart covers advance payments for prime contracts and subcontracts, except for certain excluded transactions.
- Exclusions
- Transactions listed in FAR 32.404 are not covered by this subpart.
- Commercial Advance Payments
- Advance payments for commercial items are governed by FAR Subpart 32.2, not this subpart.
Responsibilities
- Contracting Officers: Must determine whether advance payment requests fall under this subpart or are excluded, and apply the correct procedures accordingly.
- Contractors: Should understand whether their contract type is subject to these advance payment rules or another subpart.
- Agencies: Ensure oversight and correct application of advance payment policies based on contract type and transaction category.
Practical Implications
- This section exists to prevent confusion over which advance payment rules apply to different contract types.
- It impacts daily contracting by requiring careful review of contract type and transaction details before applying advance payment procedures.
- Common pitfalls include misapplying this subpart to commercial contracts or excluded transactions, leading to compliance issues.