52.214-26
Audit and Records-Sealed Bidding
Contractors must maintain and provide access to all records supporting certified cost or pricing data for contract modifications and ensure these requirements flow down to qualifying subcontracts.
Overview
FAR 52.214-26, "Audit and Records-Sealed Bidding," establishes the requirements for contractors to maintain and provide access to records related to certified cost or pricing data for contract modifications under sealed bidding procedures. The clause grants the Contracting Officer and the Comptroller General (or their representatives) the right to examine, audit, and reproduce contractor records to verify the accuracy of cost or pricing data. It also requires contractors to retain relevant records for a specified period and to flow down these requirements to certain subcontracts. Alternate I expands audit access to include Inspectors General and clarifies flowdown requirements for subcontracts.
Key Rules
- Definition of Records
- "Records" include all forms of data, whether written, electronic, or otherwise, related to contract modifications.
- Audit Rights
- The Contracting Officer and Comptroller General have the right to audit all records related to certified cost or pricing data for contract modifications.
- Record Retention
- Contractors must retain records for 3 years after final payment or as specified in FAR 4.7, and longer for terminated work or ongoing disputes.
- Subcontract Flowdown
- Contractors must include this clause in subcontracts exceeding the certified cost or pricing data threshold.
- Alternate I Provisions
- Alternate I extends audit rights to Inspectors General and modifies subcontract flowdown requirements.
Responsibilities
- Contracting Officers: Ensure inclusion of the clause and enforce audit rights.
- Contractors: Maintain, retain, and provide access to records; flow down requirements to qualifying subcontracts.
- Agencies: Exercise oversight and conduct audits as needed.
Practical Implications
- Ensures transparency and accountability in pricing contract modifications.
- Impacts contractors’ recordkeeping and subcontract management practices.
- Noncompliance can result in audit findings, payment withholds, or legal disputes.