DATE: May 22, 2003

SUBJECT: Federal Acquisition Regulation (FAR); Application of Cost Principles and Procedures, and Accounting for Unallowable Costs

SOURCE: Federal Register, May 22, 2003, Vol. 68, No. 99, page 28107

AGENCIES: Department of Defense (DOD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA)

ACTION: Proposed Rule

SYNOPSIS: It is proposed that FAR 31.201-6, Accounting for Unallowable Costs, and FAR 31.204, Application of Principles and Procedures, be amended to provide additional guidance on sampling criteria, and to clarify language.

DATES: Comments are due on or before June 21, 2003.

ADDRESSES: Submit written comments on proposed rule to General Services Administration, FAR Secretariat (MVA), 1800 F Street, NW, Room 4035, Attn: Laurie Duarte, Washington, DC 20405. Submit e-mail comments to: farcase.2002-006@gsa.gov. Cite "FAR case 2002-006" when referring to this proposed rule.


SUPPLEMENTAL INFORMATION: In 2001, Director of Defense Procurement Deidre Lee established a special interagency ad hoc committee to perform a comprehensive review of policies and procedures in FAR Part 31, Contract Cost Principles and Procedures, related to cost measurement, assignment, and allocation to assess the need for each specific requirement in light of the evolution of generally accepted accounting principles and experience gained from implementation.

Public meetings were held on April 19, 2001, May 10-11, 2001, and June 12, 2001, to discuss potential opportunities to streamline the provisions of FAR Part 31. The meetings included representatives from industry, government, and other interested parties who provided their views (for more on the meetings, see the March 7, 2001, FEDERAL CONTRACTS DISPATCH "Department of Defense; Public Meetings on Streamlining Cost Measurement, Assignment, and Allocation"). The ad hoc committee reviewed the cost principles and procedures and the public comments; identified potential changes to the FAR; and submitted draft proposed rules to the Civilian Agency Acquisition Council (CAAC) and the Defense Acquisition Regulations Council (DARC) for consideration (for another proposed rule resulting from the review of FAR Part 31 by the special interagency ad hoc committee, see the February 4, 2003, FEDERAL CONTRACTS DISPATCH "Federal Acquisition Regulation (FAR); General Provisions of the Cost Principles").

The Councils have decided to propose the following revisions to FAR Subpart 31.2, Contracts with Commercial Organizations:

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

Copyright 2003 by Panoptic Enterprises. All Rights Reserved.

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