4.804-1
Closeout by the office administering the contract
FAR 4.804-1 sets clear timelines and procedures for contract file closeout, ensuring efficient administrative closure unless litigation or unresolved terminations prevent it.
Overview
FAR 4.804-1 establishes the time standards and procedures for closing out contract files by the office administering the contract. It specifies different closeout timelines based on contract type and outlines exceptions where files cannot be closed. The regulation aims to ensure timely and efficient contract closeout, reduce administrative burden, and facilitate the deobligation of excess funds.
Key Rules
- Time Standards for Closeout
- Simplified acquisition contracts: Close upon evidence of receipt of property and final payment, unless agency rules specify otherwise.
- Firm-fixed-price contracts (not simplified): Close within 6 months after evidence of physical completion.
- Contracts requiring settlement of indirect cost rates: Close within 36 months after evidence of physical completion.
- All other contracts: Close within 20 months after evidence of physical completion.
- Closeout Procedures
- Use procedures in FAR 4.804-5 for contracts in (a)(2)-(4), with modifications as needed based on the extent of administration performed.
- Quick closeout procedures (FAR 42.708) should be used when appropriate to save costs and deobligate excess funds.
- Exceptions to Closeout
- Do not close files if the contract is in litigation/appeal or if termination actions are incomplete.
Responsibilities
- Contracting Officers: Must follow specified closeout timelines, use appropriate procedures, and ensure exceptions are observed.
- Contractors: Must provide required evidence (e.g., property receipt, completion) and resolve outstanding issues.
- Agencies: May specify additional requirements and oversee compliance with closeout standards.
Practical Implications
- Ensures contracts are closed efficiently, freeing up resources and funds.
- Delays can occur if litigation, appeals, or unresolved terminations exist.
- Using quick closeout procedures can significantly reduce administrative workload and speed up deobligation of funds.