Expired September 30, 1996

 

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96-1

Procurement Information Circular


(March 11, 1996)

COST ACCOUNTING STANDARDS IN COMMERCIAL-ITEM CONTRACTS

PURPOSE: To provide guidance regarding the applicability of cost accounting standards (CAS) to contracts for commercial items.

BACKGROUND: The Federal Acquisition Streamlining Act of 1994 revised the Office of Federal Procurement Policy Act to indicate that firm fixed price commercial-item contracts are excluded from the mandatory use of CAS. The new Federal Acquisition Reform Act of 1995, not yet implemented, extends this exclusion to all commercial-item contracts. FAR Part 12 does not include the FAR CAS clauses in the list of clauses applicable to commercial-item contracts. However, the regulations issued by the Cost Accounting Standards Board state that CAS applies to any contract for which cost data was obtained (whether or not the data was certified as current, complete and accurate). Although the Board provides certain exceptions, commercial-item contracts are not among them.

To resolve what may be perceived as a conflict between the FAR and the CAS regulations, the Board has delegated to agencies the authority to issue CAS waivers on individual firm fixed price contracts for commercial items.

GUIDANCE: Because the FAR already indicates that CAS clauses are not to be used in commercial-item contracts issued pursuant to FAR Part 12, no individual waivers are required.

EFFECTIVE DATE: This PIC is effective as dated and automatically expires on September 30, 1996, unless superseded or canceled.

HEADQUARTERS CONTACT: William T. Childs, Code HC, (202) 358-0454.

Anne Guenther
Director, Contract Management Division


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