52.230-7
Proposal Disclosure-Cost Accounting Practice Changes
Offerors must disclose and document any cost accounting practice changes affecting their proposal, ensuring transparency and proper pricing evaluation.
Overview
FAR 52.230-7, "Proposal Disclosure-Cost Accounting Practice Changes," requires offerors to disclose in their proposals whether the contract award will result in a required or unilateral change in cost accounting practices. If the answer is "yes," the offeror must prepare the price proposal using the changed practice for the relevant period and submit a description of the change to both the Contracting Officer and the Cognizant Federal Agency Official. This provision ensures transparency and proper evaluation of cost impacts due to changes in accounting practices during the proposal stage.
Key Rules
- Disclosure Requirement
- Offerors must indicate if the contract will result in a required or unilateral change in cost accounting practice.
- Proposal Preparation
- If a change is indicated, the price proposal must reflect the changed practice for the applicable period.
- Submission of Description
- A description of the changed cost accounting practice must be submitted to both the Contracting Officer and the Cognizant Federal Agency Official as pricing support.
Responsibilities
- Contracting Officers: Ensure the provision is included in solicitations and review submitted disclosures and supporting documentation.
- Contractors/Offerors: Accurately disclose any cost accounting practice changes, prepare proposals accordingly, and submit required descriptions.
- Agencies: Oversee compliance and evaluate the impact of disclosed changes on pricing.
Practical Implications
- This provision exists to prevent misunderstandings or disputes over cost accounting changes that could affect contract pricing.
- It impacts proposal preparation and evaluation, requiring careful coordination between offerors and government officials.
- Common pitfalls include failing to disclose changes or not providing adequate supporting documentation, which can delay contract award or result in noncompliance findings.