30.602 Materiality.
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(a) In determining materiality, the CFAO shall use the criteria in 48 CFR 9903.305 (FAR Appendix).
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(b) A CFAO determination of materiality-
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(1) May be made before or after a general dollar magnitude proposal has been submitted, depending on the particular facts and circumstances; and
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(2) Shall be based on adequate documentation.
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(c) When the CFAO determines the cost impact is immaterial, the CFAO shall-
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(1) Make no contract adjustments and conclude the cost impact process;
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(2) Document the rationale for the determination; and
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(3) In the case of noncompliance issues, inform the contractor that-
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(i) The noncompliance should be corrected; and
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(ii) If the noncompliance is not corrected, the Government reserves the right to make appropriate contract adjustments should the cost impact become material in the future.
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(d) For required, unilateral, and desirable changes, and CAS noncompliances, when the amount involved is material, the CFAO shall follow the applicable provisions in 30.603, 30.604, 30.605, and 30.606.