Wednesday, February 28, 2018

Seven Years to Insert a Single Word Into a Regulation

Back in October 2011, the Cost Accounting Standards Board (CASB) issued a proposed rule to clarify one of the CAS (Cost Accounting Standards) exemptions provided by FAR 9903.201. Since 2000, this provision has provided an exemption from CAS for Firm-Fixed-Price contracts and subcontracts awarded on the basis of adequate price competition without submission of cost or pricing data. The CASB proposed to add the word "certified" before "cost or pricing data".

At the time the CAS rule was promulgated in 2000, the term cost or pricing data was understood to mean certified cost or pricing data. However, as a result of changes mad to FAR (Federal Acquisition Regulations) in 2010, the term could also be read to mean cost or pricing data without the certification. Since 2000, there have been two categories of cost or pricing data; "certified cost or pricing data" and "data other than certified cost or pricing data".

To avoid confusion and provide clarity to the Government contractor community on its original intent, the CASB proposed to add the word "certified".  to wit, when certified cost or pricing data were not obtained for FFP contracts and subcontracts, the safeguards provided by CAS were likewise not necessary.

When this one-word modification was first proposed, the Space Shuttle was still flying, Osama Bin Laden was still alive, and the US had 15 million fewer people. In the meantime, we've had two Presidential election cycles. Good work guys.

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