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Panoptic Enterprises' FEDERAL CONTRACTS DISPATCH

DATE: March 4, 2002

SUBJECT: Department of Defense (DOD); Meeting on Transactions Other Than Contracts, Grants, or Cooperative Agreements for Prototype Projects

SOURCE: Federal Register, March 4, 2002, Vol. 67, No. 42, page 9632

AGENCIES: DOD

ACTION: Notice

SYNOPSIS: The Director of Defense Procurement is sponsoring a public meeting to discuss the November 21, 2001, proposed rule, which addresses the appropriate use of transactions other than contracts, grants, or cooperative agreements for prototype projects (commonly called "other transactions" (OTs)); defines a "nontraditional defense contractor"; and provides audit policy.

EDITOR'S NOTE: The regulations for OTs are in Title 32 of the Code of Federal Regulations (CFR), Chapter 1, Office of the Secretary of Defense, Part 3, Transactions Other Than Contracts, Grants, or Cooperative Agreements for Prototype Projects.

For more on the proposed rule which will be the subject of this meeting, see the November 21, 2001, FEDERAL CONTRACTS DISPATCH "Department of Defense; Transactions Other Than Contracts, Grants, or Cooperative Agreements for Prototype Projects."

DATES: The meeting will be held on March 27, 2002 from 9:00 a.m. to 5:00 p.m.

ADDRESSES: The meeting will be held at the National Contract Management Association (NCMA), 1912 Woodford Road, Vienna, VA 22182. Directions to NCMA are available at http://www.acq.osd.mil/dp/dsps/ot/pr.htm.

FOR FURTHER INFORMATION CONTACT: David Capitano, Office of Cost, Pricing, and Finance, 703-602-4245; fax: 703-602-0350; or e-mail at david.capitano@osd.mil.

SUPPLEMENTAL INFORMATION: Director of Defense Procurement Deidre Lee would like to hear the views of interested parties on what they believe to be the key issues pertaining to the November 21, 2001, proposed rule on OTs. The following are some of the possible issues that will be discussed (the issues are not limited to these):

  1. When an agreement reimburses awardees based on actual costs incurred, or provides for adjustment of payable milestones based on information from financial or cost records, what types of verifications (if any) are needed to assure that costs claimed are reasonable and accurately reflect the actual costs incurred?

  2. At what dollar amount (the proposed rule is at $300,000) and to which awardees (for example, traditional contractors only, traditional and non-traditional contractors, etc.) should the audit policy be applied?

  3. To what extent (if any) should the audit policy be applied to subawards/subawardees?

  4. When verifications are required, who should perform those verifications (for example, government auditors, independent public accountants, etc.)?

  5. If reviews/audits are performed by independent public accountants, should these reviews/audits comply with any establishes standards such as Generally Accepted Auditing Standards (GAAS) or Generally Accepted Government Auditing Standards (GAGAS)?

  6. Whether the conditions on use enacted in law are problematic. As a result of the conditions of law, has the government been unable to gain access to critical technology or otherwise been adversely affected?

    The written comments submitted by 3M Company, the American Bar Association (ABA), the Aerospace Industries Association (AIA), the Council of Defense and Space Industry Association (CODSIA), and the Integrated Dual-Use Commercial Contractors (IDCC) in response to the November 21, 2001, proposed rule are available at http://www.acq.osd.mil/dp/dsps/ot/pr.htm.

    FOR FURTHER INFORMATION CONTACT: Panoptic Enterprises at 703-451-5953 or by e-mail to Panoptic@FedGovContracts.com.

    Copyright 2002 by Panoptic Enterprises. All Rights Reserved.

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