48 CFR 9904 PDF

Title 48 – FEDERAL ACQUISITION REGULATIONS SYSTEM Chapter 99 – COST ACCOUNTING STANDARDS BOARD, OFFICE OF FEDERAL Subchapter B. 48 CFR, Pt TITLE FEDERAL ACQUISITION REGULATIONS SYSTEM AND COST ACCOUNTING STANDARDS PART COST ACCOUNTING. interpretations indicated thereto contained in 48 CFR , in effect on the date of award of this subcontract or, if the Seller has submitted cost or pricing data.

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It is expected that the program will be completed in 6 years and the test facility acquired is not expected to be required for other products of the contractor.

Quantity and quality of expected output, and the timing thereof; costs of repair and maintenance, and the timing thereof; standby or incidental use and the timing thereof; and technical or 99004 obsolescence of the asset or group of assetsor of the product or service it is involved in producing. Evidence of comparatively little communication or interpersonal relations between a home office and a segment, in relation to its size, may also indicate that the segment receives significantly less benefit from ffr expenses.

The agency head may determine that it is impractical to secure the Disclosure Statement, although submission is required, and authorize contract award without obtaining the Statement. The amount of the inventory suspense account shall be equal to the beginning inventory of contracts subject to the CAS clause of the cost accounting period in which the business unit must first allocate costs in accordance with the requirements of 99004 Cost Accounting Standard.

Except where the use of a longer or shorter period is permitted by the provisions of the Cost Accounting Standard on Cost Cffr Period The accumulation cdr direct costs in an undifferentiated account in this circumstance crr a cost accounting practice which is not consistent with the practice of estimating a significant part of costs by means of percentage factors.

Parts and apply to educational institutions except as otherwise provided in this paragraph c and at The Standard requires that, based upon contractor’s policy, the asset be capitalized. Centralized service functions performed by a home office for its segments are considered to consist of specific functions which, but for the existence of a home office, would be performed or acquired by some or all of the segments individually.

Where a directly associated cost is part of a category of costs 99044 included in an indirect-cost pool that will be allocated over a base containing the unallowable cost with which it cff associated, such a directly associated cost shall be retained in the indirect-cost pool and be allocated through the regular allocation process.

In the 99904 of a finding pursuant to paragraph c of this subsection that a compliant change is desirable, no agreement may be made with regard to cr change to a cost accounting practice that will result in the payment of aggregate increased costs by the United States. During a cost accounting period, Unit D acquires and uses a small building, constructs a small production facility using its own resources, and keeps for its own use one unit of a testing device that it manufactures and sells to its customers.


However, costs estimated for proposal purposes shall be presented in such a manner and in such detail that any significant cost can be compared with the actual cost accumulated and reported therefor.

FAR – Appendix Cost Accounting Preambles and Regulations*

The company should select a sampling time period which, preferably, is significantly longer than the anticipated life of the assets for which lives are to be established. Staff management or ccfr guidance to segments is commonly provided in the overall direction or support of the performance of discrete segment activities such as manufacturing, accounting, and engineering but see paragraph b 6 of this subsection.

The most serious questions pertain to such percentage factors which are not supported by the contractor with accounting, statistical, or other relevant data from past experience, nor by a program to accumulate actual costs for comparison with such percentage estimates. Labor-rate variances and 99004 variances may be combined into one labor-cost variance account. This coverage applies to business units that receive negotiated contracts in excess of the Truth in Negotiations Act TINA threshold, 904 adjusted for inflation 41 U.

In measuring total net CAS-covered awards for a year, a transfer by one segment to another shall be deemed to be a subcontract award by the transferor. The Contractor shall also comply with any CAS or modifications to CAS which hereafter 488 applicable to a contract or subcontract of the Contractor.

Contractor B’s department is not a production unit as defined in Company X may charge depreciation cost directly on a unit of time basis provided he uses one depreciation charging rate for all like milling machines in the machine shop and charges depreciation for all such milling machines directly to benefiting cost objectives.

The preferred representation of such relationships is a measure of the activity of the organization performing the function. The company reorganizes and requires the marketing department to report directly to a vice president at corporate headquarters.

The health insurance costs should be allocated in proportion to the beneficial and causal relationship between these costs and Segment H’s cost objectives. Provisions are then made for additional direct material costs to cover expected xfr losses such as those which occur, for example, when items are scrapped, fail to meet specifications, are lost, consumed in the manufacturing process, or destroyed in testing and qualification processes.

Other terms defined elsewhere in this part 99 shall have the meanings ascribed to them in those definitions unless paragraph b of this section requires 904. Prior to the promulgation of cost accounting standards and interpretations thereof, the Board shall:.

The average net book value shall be the average of the net book value at the beginning of the organization’s fiscal year and the net book value at the end of the year.

Checking the box below shall mean that the resultant contract is subject to the Disclosure and Consistency of Cost Accounting Practices clause in lieu of the Cost Accounting Standards clause.

Board action shall be by majority vote of the members present and voting, except that any vote to publish a proposed standard, rule or regulation in theFederal Registerfor comment or any vote to promulgate, amend or rescind a standard, rule or regulation, or any interpretation thereof, shall require at least three affirmative votes for the five Board members.


All costs identified specifically with other final cost objectives of the contractor are direct costs of those cost objectives. Capitalization shall be based upon a written policy that is reasonable and consistently applied. If the offeror is eligible to use the modified provisions of Coordinated administrative actions ctr provide greater assurances that individual contractors follow their cost accounting practices consistently under all their CAS-covered contracts and that changes in cost accounting practices or CAS noncompliance issues are resolved, equitably, in a uniform overall manner.

This term includes both direct assignment of cost and the reassignment of a share from an indirect cost pool. At the end of its cost accounting period, Company A adjusts its estimated liability to agree with its actual liability for completed years of service on an individual employee basis.

Contractor C’s practice complies with provisions of Contracts with foreign concerns subject to Ccr shall only be subject to Standard For the past several years the process resulted in an estimated future life of 10 years for this class of assets. Prior to making any contract price or cost adjustment s under the provisions of 9094 a 5 of the contract clause set forth in In these latter cases the basis for allocation shall be a measurement of the output of the supporting function.

This may be the case, for example, if a segment relies heavily on the home office for certain residual functions normally performed by other segments on their own. Full coverage applies to contractor business units that—. A single element base is inappropriate where it is an insignificant part of the total cost of some of the final cost objectives.


Contractor E’s practice complies with provisions of Output is measured in terms of units of end product produced by the supporting function, as for example, number of printed pages for a print shop, number of purchase orders processed by a purchasing department, number of hires by an employment office. OMB has assigned Control Numbers — and — to the paperwork, recordkeeping and forms associated with this regulation.

This involved internal corporate reorganization, as well as mergers and acquisitions. Preambles to the Cost Accounting Standards published by the original Cost Accounting Standards Board, as well as those preambles published by the signatories to the 9094 Acquisition Regulation respecting changes made under their regulatory authorities, are available by writing to the: A vacancy on the Board shall be filled in the same manner in which the original appointment was made.

This authority may not be delegated. The authority of the audit agencies and the contracting officers is in no way abrogated by 99904 material presented by the contractor in his Disclosure Statement.

Restructuring activities do not include ongoing routine changes an entity makes in its business operations or organizational structure.