Upon receipt of an appeal or notice of appeal, the contracting officer shall, within 10 days of receipt, forward the notice to the Board of Contract Appeals, in accordance with Subpart 5B-60.3, Rules of the GSBCA, Preliminary Procedures, paragraph 3.

§ 5B-60.202 Settlement by agreement.

The filing of a notice of appeals does not preclude negotiations looking toward settlement of a dispute; settlement may be effected at any time up to the issuance of a decision by the GSA Board of Contract Appeals.

§ 5B-60.203 Procedure following decision of the GSA Board of Contract Appeals.

Either party may file a motion for reconsideration within 30 days after issuance of a Board decision. If no such motion is filed, action to implement the Board's decision should be initiated promptly upon expiration of the 30 day period. In the event the contractor elects to appeal to the Court of Claims or to a Federal district court, action implementing the Board's decision may be suspended.

General.

Purpose of audit.

Types of contracts subject to

audit.

Contract clause.

Payments under contracts subject to audit.

Submission and processing of invoices or vouchers.

AUTHORITY: Sec. 205(c), 63 Stat. 390; 40 U.S.C. 486 (c).

SOURCE: 40 FR 47135, Oct. 8, 1975, unless otherwise noted.

Subpart 5B-63.1-Audit of Contractors'
Records
General.

§ 5B-63.101

The Contract Audits Division, Office of Audits (ADA), and the Field Audit Offices conduct contract audits (i.e., examinations) of contractors' records to the extent that such audits are required by law, regulation, or sound business judgment. Such audits include the conduct of periodic or requested audits of contractors as are warranted by such matters as the financial condition, integrity, and reliability of the contractor and prior audit experience; adequacy of the accounting system; and the amount of unaudited claims. An audit clause shall be inserted by the contracting officer, in all contracts subject to audit pursuant to § 5B-63.103.

§ 5B-63.102 Purpose of audit.

In addition to the provisions of § 1-3.809, Contract audit as a pricing aid, audits are conducted to advise, and make recommendations to, the contracting officer concerning the following:

(a) The propriety of amounts paid, or to be paid, by GSA to contractors, where such amounts are based on a cost or time determination or on variable features related to the results of contractors' operations;

(b) The adequacy of measures taken by contractors regarding the use and safeguarding of Government assets under their custody or control;

(c) The reasonableness and allowability of costs included in contractors' settlement proposals in termination of contracts (see § 1-8.207); and

(d) Contractors' financial condition and ability to perform or to continue to perform under Government contracts.

§ 5B-63.103 Types of contracts subject to audit

(a) The following types of contracts in excess of $2,500 shall include the Examination of Records by GSA clause (§ 5B-63.104):

(1) Cost-reimbursement type contracts (see § 1-3.405);

(2) Advertised or negotiated contracts involving the use or disposition of Government-furnished property;

(3) Contracts for supplies or services containing a price warranty or price reductions clause;

(4) Contracts or leases involving income to the Government where the income is based on operations that are under the control of the contractor or lessee;

(5) Fixed-price contracts with escalation (see §§ 1-2.104-3 and 1-3.404-3), incentives (see §§ 1-3.404-4 and 1-3.407), and redetermination (see §§ 1-3.404-5 and 1-3.404-7);

(6) Requirements and indefinite quantity (call-type) contracts; (see §§ 1-2.104 and 1-3.409);

(7) Time and materials and laborhour contracts (see §§ 1-3.406-1 and 13.406-2); and

(8) Leases (1) where the rental is subject to adjustment (such as for change in real estate taxes or service costs) or (ii) where the rental is dependent upon actual costs.

(b) In some of the contracts listed in paragraph (a) of this § 5B-63.103, it may be appropriate to define in the contract the scope or extent of any audit, such as with respect to (1) the use or disposition of Government-furnished property or (2) variable or other special features of the contract, e.g., price escalation and compliance with the price warranty or price reductions clauses. In such cases, the contract clause is § 5B-63.104 may be modified appropriately with the concurrence of the (1) Office of General Counsel or Regional Counsel and (2) Contract Audit Division or the Field Audit Office, as appropriate.

(c) Inclusion of the contract clause in § 5B-63.104 (whether or not modified) in contracts does not affect in any way the requirements for (1) use of the Examination of Records clause permitting review of contractor books and records by the Comptroller General (see §§ 1-7.602-7 and 1-7.103-3) or (2) the clauses on Audit and Records pertaining to the verification of cost or pricing data (see § 1-3.814-2).

§ 5B-63.104 Contract clause.

The following contract clause is prescribed for use as provided in § 5B-63.103:

EXAMINATION OF RECORDS BY GSA

The Contractor agrees that the Administrator of General Services or any of his duly authorized representatives shall, until the expiration of three years after final payment under this contract, or of the time periods for the particular records specified in Part 1-20 of the Federal Procurement Regulations (41 CFR Part 1-20), whichever expires earlier, have access to, and the right to examine, any books, documents, papers, and records of the Contractor involving transactions related to this contract or compliance with any clauses thereunder.

The Contractor further agrees to include in all his subcontracts hereunder a provision to the effect that the subcontractor agrees that the Administrator of General Services or any of his duly authorized representatives shall, until the expiration of three years after final payment under the subcontract, or of the time periods for the particular records specified in Part 1-20 of the Federal Procurement Regulations (41 CFR Part 1-20), whichever expires earlier, have access to and the right to examine any books, documents, papers, and records of such subcontractor involving transactions related to the subcontract or compliance with any clauses thereunder. The term "Subcontract" as used in this clause excludes (a) purchase orders not exceeding $2,500 and (b) subcontracts or purchase orders for public utility services at rates established for uniform applicability to the general public. § 5B-63.105 Payments under contracts subject to audit.

§ 5B-63.105-2 Submission and processing of invoices or vouchers.

Contractors shall be required to submit invoices or vouchers directly to the contracting officer. The processing of invoices or vouchers prior to payment for work or services rendered shall include a review by the contracting officer, or his designated representative, to determine that the nature of items and amounts claimed are in consonance with the contract terms, represent prudent business transactions, and are within any stipulated contractual limitations. The contracting officer must ensure that these payments are commensurate with physical and technical progress under the contract. If the contractor has not deducted from his claim amounts which are questionable or which are required to be withheld, the contracting officer shall make the required deduction.

6-1.1003-2 General requirements.

AUTHORITY: The provisions of this Part 6-1 issued under sec. 205 (c), 63 Stat. 390, as amended, 40 U.S.C. 486(c); sec. 4, 63 Stat. 111, 22 U.S.C. 2658.

Subpart 6-1.1-Introduction

SOURCE: The provisions of this Subpart 61.1 appear at 28 F.R. 7779, July 31, 1963, unless otherwise noted.

§ 6-1.101 Scope of subpart.

This subpart describes the Department of State Procurement Regulations in terms of establishment, relationship to the Federal Procurement Regulations (FPR), arrangement, applicability, and deviation procedure. Procurement procedures are integrated with the regulations so as to provide a complete, logical and comprehensive publication.

and nonpersonal services (including construction) by the Department of State both within and outside the United States except for those operations which have exemption from the Federal Property and Administrative Services Act of 1949, as amended.

(b) The DOSPR and FPR do not apply to the acquisition or leasing of real property.

(c) The FPR has been edited for use by the Foreign Service. Those portions which are not applicable to procurement outside the United States have been removed except that the contents pages are complete for reference purposes.

(d) At posts where Joint Administrative Offices have been formed, the DOSPR and the FPR are applicable to procurement from Shared Administrative Support funds. The DOSPR and the FPR are applicable for all AID administrative and technical support procurement, except in areas which have been defined by the AID Office of Administrative Services (A/AS).

Certain Department of State policies and procedures which come within the scope of this chapter nevertheless may be excluded from the DOSPR. These exclusions include the following categories:

(a) Subject matter which bears a security classification.

(b) Policy or procedure which is expected to be effective for a period of less than six months.

(c) Policy or procedure which is being instituted on an experimental basis for a reasonable period.

[Redesignated, 31 F.R. 10193, July 28, 1966] § 6-1.106 Issuance.

Regulations contained in the DOSPR deemed necessary for business concerns, and others properly interested, to understand basic and significant Department of State procurement policies are published in the Code of Federal Regulations (CFR) as Chapter 6 of Title 41, Public Contracts, and are published in issues of the FEDERAL REGISTER and in separate loose-leaf volume form.

[Redesignated, 31 PR. 10193, July 28, 1966] § 6-1.107 Arrangement.

[Redesignated, 31 FR. 10193, July 28, 1966]

§ 6-1.107-1 General plan.

The DOSPR conform with the style and arrangement of the FPR. [Redesignated, 31 F.R. 10193, July 28, 1966] § 6-1.107-2 Numbering.

Material in the DOSPR which implements or deviates from related material in the FPR is captioned and numbered to correspond with such material in the FPR, except that while the first digit of the FPR number is 1, the first digit of the DOSPR number is 6. Material in the DOSPR which supplements the FPR will be assigned numbers 50 or above at the part, subpart, section, or subsection at which there is no counterpart material in the FPR. For an example, see section 6-1.350. Where material in the FPR requires no implementation or deviation there is no corresponding number in the DOSPR. Thus, there are gaps in the DOSPR sequence of numbers where the FPR as written are applicable to Department of State procurement. [Redesignated, 81 F.R. 10193, July 28, 1966] § 6-1.107-3 Citation.

The DOSPR will be cited in the same manner as the FPR are cited. Thus, this section, when referred to in divisions of the FPR System, should be cited as "section 6-1.107-3 of this chapter." When this section is referred to formally in official documents, such as legal briefs, it should be cited as "41 CFR 6-1.107-3." Any section of the DOSPR may be informally identified, for purposes of brevity, as "DOSPR" followed by the section number, such as "DOSPR 6-1.107-3." [Redesignated, 31 FR. 10193, July 28, 1966] § 6-1.108

Relationship of the DOSPR, FPR, and IAPR.

(a) The regulations in the DOSPR implement, supplement, and in some instances deviate from the FPR. Implementing material is that which expands upon or indicates the manner of compliance with related FPR material. Deviating material is defined in § 1-1.009. Supplementing material is that for which there is no counterpart in the FPR.

(b) The FPR as edited for the Foreign Service and the DOSPR have been adopted in general for use by the U.S. Information Service. They are to be used with the U.S. Information Agency Regulations (IAPR) which implement, supplement and deviate from the FPR

DOSPR. Chapter 19A of IAPR applies only to overseas procurement of USIA. [31 FR. 10193, July 28, 1966]

§ 6-1.109 Control of deviations.

In the interest of establishing and maintaining uniformity to the greatest extent feasible, deviations from the FPR System shall be kept to a minimum and controlled as follows:

(a) Requests for deviations from the FPR and from the DOSPR, in individual cases and in classes of cases, shall be submitted by memorandum. A statement setting forth the nature of the deviation and the reasons for the special action sought shall be included with the request, and a copy thereof shall be included in the contract file.

(b) Deviations from the FPR and the DOSPR in individual cases, and from the DOSPR, in classes of cases, may be authorized by the Chief, Supply and Transportation Services Division or his designee, or, in foreign buildings procurement operations, by the Director, Office of Foreign Buildings or his designee.

(c) Deviations from the FPR in classes of cases will be considered jointly by the Department of State and the General Services Administration (GSA) unless circumstances preclude such effort. In such case, the Chief, Division of Supply and Transportation Services or the Director, Office of Foreign Buildings, as appropriate, will approve such class deviations as he determines necessary and will notify GSA of such action. [31 F.R. 6622, May 4, 1966]

Subpart 6-1.2-Definition of Terms

SOURCE: The provisions of this Subpart 6-1.2 appear at 28 FR. 7779, July 31, 1963, unless otherwise noted.

§ 6-1.201 Definitions.

For the purpose of this chapter, and unless otherwise indicated, the following terms have the meanings set forth in this subpart.