PART 42 -- CONTRACT ADMINISTRATION AND AUDIT SERVICES
TABLE OF CONTENTS
SUBPART 42.1-90 -- INTERAGENCY CONTRACT ADMINISTRATION AND AUDIT SERVICES
42.9000 Audit resolution and disposition
SUBPART 42.15 -- CONTRACTOR PERFORMANCE INFORMATION
42.1502 Policy
42.1503 Procedures
PART 42 -- CONTRACT ADMINISTRATION AND AUDIT SERVICES
SUBPART 42.1-90 — INTERAGENCY CONTRACT ADMINISTRATION AND
AUDIT SERVICES
42.9000 Audit resolution and disposition.
(a) Policy. Contracting officers shall use contract audit advice provided by the Defense Contract Audit Agency (DCAA) and promptly act to resolve DCAA audit recommendations. This requires --
(1) Full consideration of audit findings and recommendations;
(2) Prompt and proper resolution of differences between contracting officers and auditors on proposed disposition of audit findings and recommendations;
(3) Expeditious disposition (including fund recovery actions);
(4) Documentation of differences between audit recommendation and dispositions thereof; and
(5) Open dialogue between contracting, auditing, and audit follow-up personnel to establish and maintain an effective audit resolution system.
(b) System structure. The contract audit follow-up system shall be structured in consonance with the contracting officer’s independent decision making role and the contract auditor’s financial advisory role. Resolution of audit reports (other than pre-award) is required by law within six months of report issuance. Disposition shall take place as soon as possible after resolution.
(c) Responsibilities.
(1) PL is the contract audit follow-up official responsible for managing DISA’s contract audit follow-up program. PL ensures that the DISA contract audit follow-up system is implemented in accordance with DoD Directive 7640.2, as amended, and that system operation results in timely and appropriate resolution and disposition of audit reports.
(2) HCOs must ensure that:
(i) Contracting officers fully consider contract audit advice in the course of determining pre-negotiation positions.
(ii) Audit findings and recommendations are resolved and disposed of effectively and in a timely manner, while fully protecting the Government’s interest.
(iii) Up-to-date records are maintained on all applicable audit reports from receipt through disposition. For open reports, this includes written milestone plans comprised of target dates for resolution and disposition, and planned actions to accomplish those dates. When an audit is resolved, it must be supported by specific contract file documentation.
(iv) The semiannual contract audit follow-up status report submission is-
Prepared in accordance with DoD Directive 7640.2, as amended;
Verified against prior status report submission and the applicable DCAA control logs, and
Submitted to PL within 15 calendar days after the end of the 31 Mar and 30 Sep reporting periods. PL coordinates submittal of the Agency report to the DoD Inspector General within 30 calendar days after the end of the reporting period.
(v) Adequate training is provided.
(vi) Procedures are established for documenting and reviewing:
Proposed pre-negotiation objectives that provide the independent review for internal control purposes. This will be accomplished as part of the business clearance review and approval process. In documenting the pre-negotiation position, the contracting officer shall indicate whether the audit recommendations were accepted or, if not, whether the auditor revised them. When the contracting officer disagrees with the audit position, the contracting officer’s pre-negotiation documentation shall include the rationale for not accepting the audit advice. The post-negotiation documentation shall include a summary of the field pricing report recommendations and reasons for any pertinent variances from these recommendations.
Objections from the contractor to the administrative contracting officer (ACO) for auditor-determined indirect cost rates. This will be accomplished as part of the business clearance review and approval process. If the contractor submits a written objection to the ACO, the ACO may communicate further with the contractor in order to reach agreement. If the ACO disagrees with the audit recommendation, the ACO shall comply with the business clearance procedures for documentation and review before disposition. If the ACO agrees with the audit recommendations, the ACO shall issue a final decision, after complying with the clearance review and approval procedures.
(vii) Provided a copy of the post-negotiation business clearance is to the cognizant contract auditor so the report may be closed.
(viii) Any recovery of funds is accomplished in accordance with DoD Directive 7640.2, as amended, FAR 32.6, and DFARS 232.6.
SUBPART 42.15 — CONTRACTOR PERFORMANCE INFORMATION
(a) Effective 1 October 2002, DISA entered into an Inter Service Support Agreement to use the U.S. Army Past Performance Information Management System (PPIMS) for collecting and forwarding past performance information (PPI) to the federal Past Performance Information Retrieval System (PPIRS). The PPIMS is a web-based tool that provides real-time capability to collect PPI for use in future source selections.
(S-90) The PPIMS Command Administrator has overall responsibility to provide initial training to users and Site Administrators at NCR and all DITCO field offices. Thereafter, Site Administrators at NCR and the DITCO field offices provide training to all new users at their respective site. Upon successful completion of training, registering at the below site, and receiving approval by the NCR or appropriate DITCO Site Administrator, users begin entering data into PPIMS.
https://apps.rdaisa.army.mil/ppims/prod/ppimshpdisa.htm.
(S-91) DISA is required to prepare a performance assessment report (PAR) for a contractor’s performance when the contract value (base and all options) is $1,000,000 or greater (regardless of date of contract award).
(S-92) This threshold applies to all contracts, task orders, orders under GSA schedules, Basic Ordering Agreements (BOAs), Communication Service Authorizations (CSAs), etc. Contracting officers are encouraged to use the PPIMS for collecting and reporting contractor past performance less than $1,000,000. Entering PARs less than the mandatory threshold in PPIMS makes the data available to all registered PPIRS users.
(S-93) The threshold applies to the “as-modified” contract value. If a contract value is less than $1,000,000, but is later modified and the “new” contract value is $1,000,000 or greater, then a PAR should be made beginning with the first anniversary that the contract’s value reaches $1,000,000.
(S-94) As soon as it is anticipated that the threshold will be met or exceeded (e.g., modification), initiate the PPI collection process by entering the required data into PPIMS.
(S-95) Frequency of PARs. The contracting officer establishes PAR-reporting frequency. A PAR must be completed at least every 12 months. The contracting officer determines if a PAR will be completed on the basic contract vehicle or on individual task orders. Once established, the frequency should remain consistent throughout the performance of the contract. Types of PARs are:
(i) Interim. The contract vehicle is in progress and exceeds 12 months. Annual PARs are not required for the period of time between contract performance completion and contract closeout.
(ii) Final. Prepared upon physical contract completion. For contracts not exceeding one year, the final PAR is the only record. For contracts with performance periods exceeding one year, the final PAR addresses only the last performance period, and may not be used to “roll up” a contractor’s performance under the entire contract.
(iii) Addendum. Prepared for a post physical contract completion (i.e., warranty administration; contract closeout problems, conversion of a Termination for Default to a Termination for Convenience of the Government, or other administrative requirements such as submitting final reports, final indirect cost proposals, technical data, etc.).
(S-95) The contracting officer should consider the below factors in deciding frequency for assessments:
(i) Contract type
(ii) Period of performance
(iii) Deliverable vs. level of efforts
(iv) Milestones
(v) Risk associated with performance
(S-96) Upon completion of a PAR, current performance assessment reports become past performance information used in source selections. Completion of PARs improves the amount and quality of performance information available to source selection teams.
(b) When developing a method of contracting (i.e., IDIQ, BOAs, BPAs, CSAs, etc.) for use by DISA and other agencies, ensure the contract instructs agencies placing orders to use an approved web-based system for collecting PPI that feeds into PPIRS. Include the following reference in the contract: For a list of automated systems, see DoD’s "Guide to Collection and Use of PPI, Appendix I (Automated Past Performance Information Systems).” The order-issuing agency is responsible for following their agency procedures to report PPI.
(c) When placing orders on another agency’s contract, follow DARS Part 42 for using, collecting, and entering PPI into PPIMS.
(a) Refer to the DISA Collecting and Using Past Performance Deskbook available on the PPIMS web page under Past Performance References at PPIMS Homepage. Past performance assessments are a combined responsibility of the contracting officer (assessing official), COR, TM, Evaluator, contract specialist, and reviewing official.
(b) Prepare PARS timely to ensure the integrity of the PPI. Contracting officers appoint CORs, TMs, or evaluators in writing. When the evaluator is the COR or TM, the evaluator designation will be included in the COR or TM appointment letter. Otherwise, a separate appointment letter should be issued.
(S-90) When the PAR is ready for contractor review, PPIMS sends an email notice to the contractor-identified POC. The contractor must register in PPIMS at https://apps.altess.army.mil/ppims/prod/ca/ppimscahp.cfm. (NOTE: The link for contractor registration is different from the link used by registered Government users.) When the contractor registers, the data are verified with the Central Contractor Registry (CCR) data. The PAR owner (contract specialist) receives a notice that the contractor requested access. The contract specialist approves contractor access. The contract specialist is the individual most familiar with the contractor, and therefore, approves the access request.
(S-91) Contractors have a minimum of 30 calendar days to review the PAR and concur or non-concur. Contractors non-concur by submitting rebutting statements or additional information.
(S-92) The contractor has 14 calendar days to initially access the PAR. If the contractor has not accessed PAR within 14 days, an electronic notice is sent to the contracting officer (assessing official). The contracting officer must contact the contractor to determine why the contractor has not accessed the PAR for review. It is very important that the PAR owner not delay approving the contractor’s request for access to PPIMS. If the contractor neither concurs nor non-concurs after 30 days, the PAR is sent to PPIRS where the data are available for source selection.
(S-93) If the contractor non-concurs, the contracting officer (assessing official) must contact the contractor and attempt to resolve the issue(s). If a successful resolution is reached, the contracting officer (assessing official) revises the PAR and provides a copy to the contractor for review, concurrence, or non-concurrence. If the contracting officer (assessing official) is unable to resolve the issue(s), the PAR along with the rebutting comments is forwarded to the Reviewing Official for a unilateral final decision.
(d) Access.
(S-90) The Command Administrator and Alternate Command Administrator have access to all DISA records in PPIMS and PPIRS databases. Individual Site Administrators only have access to PARs assigned to their site and no access to the PPIRS database unless they are registered and currently assigned to an on-going source selection.
(S-91) Access to PPIMS is restricted to authorized Government personnel and contractors registered and approved for access.
(S-92) See the DISA Collecting and Using Past Performance Deskbook for additional guidance on protecting PPI.
(e) The PPIRS automatically archives PARs three years from the final date of contract performance. This includes task orders, calls under a BPA or BOA, etc. Archived PARs are not accessible.