Price Redetermination
Started by Mich Ford · Mar 19, 2013 · 3 replies
- MOriginal post
Mich Ford
Mar 19, 2013 · 13y ago
New to the posting here but not new to the site...
So I am currently in the middle of a price redetermination. Hope it's not too late in the game but can someone(s) please give me some lessons learned/things to watch out for during this process? It is all becoming a bit more than negotiations at this point because of the reliance on the contractor's information only. Help.
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Guest Vern Edwards
Mar 19, 2013 · 13y ago
Please identify the contract type by reference to a specific section within FAR Part 16. Are you talking about a fixed-price contract with prospective price predetermination (FAR 16.205), a fixed-price contract with retroactive price redetermination (FAR 16.206), or some other type of contract?
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Mich Ford
Mar 20, 2013 · 13y ago
Fixed price with prospective
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Larry Edwards
Mar 20, 2013 · 13y ago
I assume that one of the criteria for use of this contract type, that the contractor’s accounting system is adequate for price redetermination, has been met and you have gotten an audit. If so, you may have little leeway to negotiate. Most fixed price redetermination proposals I have seen have used actual costs incurred as the basis for the next period. It is going to be hard to fight actual incurred costs unless you can prove they were unreasonably incurred, a very difficult burden for the Government. You need to focus on what is different in the next period, such as any inflation proposed, differences in quantities, changes, or proposed increases from actual costs and get a good understanding of those.