Cost Accounting Standards Board (CAS); Applicability of Cost Accounting Standards Coverage, 32546-32549 [E7-11325]
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32546
Federal Register / Vol. 72, No. 113 / Wednesday, June 13, 2007 / Rules and Regulations
by the Mentor to verify that USAID is
not charged by the Mentor for providing
´ ´
developmental assistance to the Protege;
and
(4) Limiting the number of
´ ´
participants in the Mentor-Protege
Program within a reporting period, in
order to insure the effective
management of the Program.
(b) USAID may rescind approval of an
´ ´
existing Mentor-Protege Agreement if it
determines that such action is in
USAID’s best interest. The rescission
shall be in writing and sent to the
´ ´
Mentor and Protege after approval by
the Director of OSDBU. Rescission of an
Agreement does not change the terms of
any subcontract between the Mentor
´ ´
and the Protege.
719.273–11 Solicitation Provision and
Contract Clause.
(a) The Contracting Officer shall insert
the provision at AIDAR 752.219–70 in
all unrestricted solicitations exceeding
$550,000 ($1,000,000 for construction)
that offer subcontracting opportunities.
(b) The Contracting Officer shall
insert the clause at AIDAR 752.219–71
in all contracts where the prime
´ ´
contractor has signed a Mentor-Protege
Agreement with USAID.
PART 752—SOLICITATION
PROVISIONS AND CONTRACT
CLAUSES
3. Add section 752.219–70 to read as
follows:
´ ´
USAID Mentor-Protege
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As prescribed in 719.273–11(a), insert
the following provision:
´ ´
USAID Mentor-Protege Program (July 13,
2007)
(a) Large and small business are
encouraged to participate in the USAID
´ ´
Mentor-Protege Program (the ‘‘Program’’).
Mentor firms provide eligible small business
´ ´
Proteges with developmental assistance to
enhance their business capabilities and
ability to obtain Federal contracts.
(b) Mentor firms are large prime
contractors or eligible small business capable
of providing developmental assistance.
´ ´
Protege firms are small business as defined
in 13 CFR parts 121, 124, and 126.
(c) Developmental assistance is technical,
managerial, financial, and other mutually
´ ´
beneficial assistance that aids Proteges. The
costs for developmental assistance are not
chargeable to the contract.
(d) Firms interested in participating in the
Program are encouraged to contact the
´ ´
USAID Mentor-Protege Program Manager
(202–712–1500) for more information.
(End of provision)
4. Add section 752.219–271 to read as
follows:
I
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As prescribed in AIDAR 719.273–
11(b), insert the following clause:
Mentor Requirements and Evaluation (July
13, 2007)
´ ´
(a) Mentor and Protege firms shall submit
an evaluation of the overall experience in the
Program to OSDBU at the conclusion of the
mutually agreed upon Program period, the
conclusion of the contract, or the voluntary
withdrawal by either party from the Program,
whichever occurs first. At the conclusion of
´ ´
each year in the Mentor-Protege Program, the
´ ´
Mentor and Protege will formally brief the
´ ´
USAID Mentor-Protege Program Manager
regarding Program accomplishments under
´ ´
their Mentor-Protege Agreement.
´ ´
(b) Mentor or Protege shall notify OSDBU
in writing, at least 30 calendar days in
advance of the effective date of the firm’s
withdrawal from the Program.
(End of clause)
Dated: May 31, 2007.
Robert K. Egge,
Acting Director, Office of Small and
Disadvantaged Business Utilization (OSDBU).
[FR Doc. E7–11093 Filed 6–11–07; 8:45 am]
BILLING CODE 6116–01–P
OFFICE OF MANAGEMENT AND
BUDGET
Office of Federal Procurement Policy
I
752.219–70
Program.
752.219–71 Mentor Requirements and
Evaluation.
48 CFR Part 9903
Cost Accounting Standards Board
(CAS); Applicability of Cost
Accounting Standards Coverage
Cost Accounting Standards
Board, Office of Federal Procurement
Policy, OMB.
ACTION: Final rule.
AGENCY:
SUMMARY: The Office of Federal
Procurement Policy, Cost Accounting
Standards (CAS) Board, has adopted,
without change from the interim rule, a
final rule revising the criteria applicable
to United Kingdom (UK) contractors for
filing a Disclosure Statement, Form No.
CASB DS–1. This rulemaking is
authorized pursuant to Section 26 of the
Office of Federal Procurement Policy
Act.
EFFECTIVE DATE: June 13, 2007.
FOR FURTHER INFORMATION CONTACT:
Laura Auletta, Manager, Cost
Accounting Standards Board, 725 17th
Street, NW., Room 9013, Washington,
DC 20503 (telephone: 202–395–3256).
SUPPLEMENTARY INFORMATION:
A. Background
On May 23, 2005, the Cost
Accounting Standards Board published
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an interim rule with request for
comment (70 FR 29457) for the purpose
of revising the criteria applicable to
United Kingdom (UK) contractors for
filing a Disclosure Statement, Form No.
CASB DS–1. The interim rule was
adopted in order to comply with a
specific request by the UK Ministry of
Defence (MOD) to simplify the
compliance process with CAS Board
disclosure requirements for UK
contractors.
Unlike certain other foreign
contractors, UK contractors have been
required to file a CASB DS–1 in
accordance with CAS regulations. The
MOD initially approached the Board
with a request that UK contractors be
permitted to use the corresponding UK
form ‘‘Questionnaire on Method of
Allocation of Costs’’ (QMAC), in lieu of
the CASB DS–1. After a review of the
content of the QMAC, the UK and U.S.
representatives agreed that it did not
have the same scope as the CASB DS–
1. Therefore, it was agreed that to cover
the gap in the coverage a ‘‘Supplemental
QMAC’’ was needed.
Based upon the Board’s approval of a
Supplemental QMAC that is acceptable
to the MOD, the MOD requested that the
CAS Board allow UK contractors to
submit their basic QMAC, together with
the Supplemental QMAC, in lieu of the
DS–1. At its meeting on February 23,
2005, the Board agreed to change the
CAS requirements so that UK
contractors with CAS-covered contracts
may file the UK QMAC together with its
Supplement in lieu of the CASB DS–1
required of U.S. contractors. In
conjunction with this change, the Board
also agreed to eliminate the specific
paragraph addressing UK contractors at
9903.201–1(b)(12). As a result, UK
contractors are subject to the
requirements of 9903.201–1(b)(4), i.e.,
contracts and subcontracts with UK
contractors are exempt from CAS
‘‘insofar as the requirements of CAS
other than 9904.401 and 9904.402 are
concerned.’’ The May, 2005 interim rule
reflected these Board approved
revisions.
B. Public Comments
The Board received one set of public
comments in response to the Interim
Rule.
1. CAS Coverage for UK Contractors
Comment: The commenter requested
confirmation that the rule requires that
UK contractors comply only with CAS
401 and 402.
Response: The language in the final
rule requires that all UK contractors
performing U.S. Government contracts
and not otherwise exempt under 48 CFR
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9903.201–1 will be required to comply
only with CAS 401 and 402 in
accordance with 48 CFR 9903.201–
1(b)(4).
2. Extent of Disclosure Requirement
Comment: The commenter expressed
concern that UK contractors are subject
to more extensive disclosure
requirements than other countries listed
in 48 CFR 9903.201–4(e) by virtue of the
QMAC Supplement.
Response: The Board believes that the
disclosure requirements for UK
contractors provide the information
necessary for the UK MOD to determine
whether such contractors are complying
with the provisions of CAS 401 and 402.
The MOD initially requested that its
contractors be permitted to file only the
QMAC. However, as described in the
Background section above, the Board
determined that the QMAC, by itself,
did not provide sufficient information
about the accounting practices of UK
contractors. Therefore, working jointly
with the MOD, the QMAC supplement
was developed to minimize duplicate
disclosures while providing the
additional information needed to cover
the gap between the QMAC and CASB
DS–1.
C. Paperwork Reduction Act
The Paperwork Reduction Act, Public
Law 96–511, does not apply to this
rulemaking, because this rule imposes
no paperwork burden on offerors,
affected contractors and subcontractors,
or members of the public which requires
the approval of OMB under 44 U.S.C.
3501, et seq.
D. Executive Order 12866 and the
Regulatory Flexibility Act
The Board certifies that this rule will
not have a significant effect on a
substantial number of small entities
within the meaning of the Regulatory
Flexibility Act, 5. U.S.C. 601, et seq.,
because small businesses are exempt
from the application of the Cost
Accounting Standards.
List of Subjects in 48 CFR Part 9903
Accounting, Government
procurement.
Paul A. Denett,
Administrator, Office of Federal Procurement
Policy.
For the reasons set forth in this
preamble, Chapter 99 of title 48 of the
Code of Federal Regulations is amended
as set forth below. Please note that, in
publishing the interim rule, the Code of
Federal Regulations inadvertently
removed and reserved paragraph (d) of
the first clause under Section 9903.201–
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4 entitled ‘‘Cost Accounting Standards
(June 2000)’’ instead of paragraph (d) of
the section. This final rule corrects that
error and, for clarity, restates the section
in its entirety. Therefore, the interim
final rule published at 70 FR 29457,
May 23, 2005, is adopted as final with
the following changes.
PART 9903—CONTRACT COVERAGE
1. The authority citation for part 9903
continues to read as follows:
I
Authority: Pub. L. 100–679, 102 Stat. 4056,
41 U.S.C. 422.
Subpart 9903.2—CAS Program
Requirements
2. Section 9903.201–4 is revised to
read as follows:
I
9903.201–4
Contract clauses.
(a) Cost Accounting Standards. (1)
The contracting officer shall insert the
clause set forth below, Cost Accounting
Standards, in negotiated contracts,
unless the contract is exempted (see
9903.201–1), the contract is subject to
modified coverage (see 9903.201–2), or
the clause prescribed in paragraph (e) of
this section is used.
(2) The clause below requires the
contractor to comply with all CAS
specified in part 9904, to disclose actual
cost accounting practices (applicable to
CAS-covered contracts only), and to
follow disclosed and established cost
accounting practices consistently.
Cost Accounting Standards (June 2000)
(a) Unless the contract is exempt under
9903.201–1 and 9903.201–2, the provisions
of 9903 are incorporated herein by reference
and the Contractor in connection with this
contract, shall—
(1) (CAS-covered Contracts Only) By
submission of a Disclosure Statement,
disclosed in writing the Contractor’s cost
accounting practices as required by
9903.202–1 through 9903.202–5 including
methods of distinguishing direct costs from
indirect costs and the basis used for
allocating indirect costs. The practices
disclosed for this contract shall be the same
as the practices currently disclosed and
applied on all other contracts and
subcontracts being performed by the
Contractor and which contain a Cost
Accounting Standards (CAS) clause. If the
Contractor has notified the Contracting
Officer that the Disclosure Statement
contains trade secrets, and commercial or
financial information which is privileged and
confidential, the Disclosure Statement shall
be protected and shall not be released outside
of the Government.
(2) Follow consistently the Contractor’s
cost accounting practices in accumulating
and reporting contract performance cost data
concerning this contract. If any change in
cost accounting practices is made for the
purposes of any contract or subcontract
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32547
subject to CAS requirements, the change
must be applied prospectively to this
contract and the Disclosure Statement must
be amended accordingly. If the contract price
or cost allowance of this contract is affected
by such changes, adjustment shall be made
in accordance with subparagraph (a)(4) or
(a)(5) of this clause, as appropriate.
(3) Comply with all CAS, including any
modifications and interpretations indicated
thereto contained in part 9904, in effect on
the date of award of this contract or, if the
Contractor has submitted cost or pricing data,
on the date of final agreement on price as
shown on the Contractor’s signed certificate
of current cost or pricing data. The
Contractor shall also comply with any CAS
(or modifications to CAS) which hereafter
become applicable to a contract or
subcontract of the Contractor. Such
compliance shall be required prospectively
from the date of applicability of such contract
or subcontract.
(4)(i) Agree to an equitable adjustment as
provided in the Changes clause of this
contract if the contract cost is affected by a
change which, pursuant to subparagraph
(a)(3) of this clause, the Contractor is
required to make to the Contractor’s
established cost accounting practices.
(ii) Negotiate with the Contracting Officer
to determine the terms and conditions under
which a change may be made to a cost
accounting practice, other than a change
made under other provisions of subparagraph
(a)(4) of this clause; provided that no
agreement may be made under this provision
that will increase costs paid by the United
States.
(iii) When the parties agree to a change to
a cost accounting practice, other than a
change under subdivision (a)(4)(i) of this
clause, negotiate an equitable adjustment as
provided in the Changes clause of this
contract.
(5) Agree to an adjustment of the contract
price or cost allowance, as appropriate, if the
Contractor or a subcontractor fails to comply
with an applicable Cost Accounting
Standard, or to follow any cost accounting
practice consistently and such failure results
in any increased costs paid by the United
States. Such adjustment shall provide for
recovery of the increased costs to the United
States, together with interest thereon
computed at the annual rate established
under section 6621(a)(2) of the Internal
Revenue Code of 1986 (26 U.S.C. 6621(a)(2))
for such period, from the time the payment
by the United States was made to the time
the adjustment is effected. In no case shall
the Government recover costs greater than
the increased cost to the Government, in the
aggregate, on the relevant contracts subject to
the price adjustment, unless the Contractor
made a change in its cost accounting
practices of which it was aware or should
have been aware at the time of price
negotiations and which it failed to disclose
to the Government.
(b) If the parties fail to agree whether the
Contractor or a subcontractor has complied
with an applicable CAS in part 9904 or a
CAS rule or regulation in part 9903 and as
to any cost adjustment demanded by the
United States, such failure to agree will
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Federal Register / Vol. 72, No. 113 / Wednesday, June 13, 2007 / Rules and Regulations
constitute a dispute under the Contract
Disputes Act (41 U.S.C. 601).
(c) The Contractor shall permit any
authorized representatives of the Government
to examine and make copies of any
documents, papers, or records relating to
compliance with the requirements of this
clause.
(d) The contractor shall include in all
negotiated subcontracts which the Contractor
enters into, the substance of this clause,
except paragraph (b), and shall require such
inclusion in all other subcontracts, of any
tier, including the obligation to comply with
all CAS in effect on the subcontractor’s
award date or if the subcontractor has
submitted cost or pricing data, on the date of
final agreement on price as shown on the
subcontractor’s signed Certificate of Current
Cost or Pricing Data. If the subcontract is
awarded to a business unit which pursuant
to 9903.201–2 is subject to other types of
CAS coverage, the substance of the
applicable clause set forth in 9903.201–4
shall be inserted. This requirement shall
apply only to negotiated subcontracts in
excess of $500,000, except that the
requirement shall not apply to negotiated
subcontracts otherwise exempt from the
requirement to include a CAS clause as
specified in 9903.201–1.
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(End of clause)
(b) [Reserved].
(c) Disclosure and Consistency of Cost
Accounting Practices. (1) The
contracting officer shall insert the clause
set forth below, Disclosure and
Consistency of Cost Accounting
Practices, in negotiated contracts when
the contract amount is over $500,000
but less than $50 million, and the
offeror certifies it is eligible for and
elects to use modified CAS coverage
(see 9903.201–2, unless the clause
prescribed in paragraph (d) of this
subsection is used).
(2) The clause below requires the
contractor to comply with CAS
9904.401, 9904.402, 9904.405, and
9904.406, to disclose (if it meets certain
requirements) actual cost accounting
practices, and to follow consistently
disclosed and established cost
accounting practices.
Disclosure and Consistency of Cost
Accounting Practices (June 2000)
(a) The Contractor, in connection with this
contract, shall—
(1) Comply with the requirements of
9904.401, Consistency in Estimating,
Accumulating, and Reporting Costs;
9904.402, Consistency in Allocating Costs
Incurred for the Same Purpose; 9904.405,
Accounting for Unallowable Costs; and
9904.406, Cost Accounting Standard—Cost
Accounting Period, in effect on the date of
award of this contract, as indicated in part
9904.
(2) (CAS-covered Contracts Only) If it is a
business unit of a company required to
submit a Disclosure Statement, disclose in
writing its cost accounting practices as
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required by 9903.202–1 through 9903.202–5.
If the Contractor has notified the Contracting
Officer that the Disclosure Statement
contains trade secrets and commercial or
financial information which is privileged and
confidential, the Disclosure Statement shall
be protected and shall not be released outside
of the Government.
(3)(i) Follow consistently the Contractor’s
cost accounting practices. A change to such
practices may be proposed, however, by
either the Government or the Contractor, and
the Contractor agrees to negotiate with the
Contracting Officer the terms and conditions
under which a change may be made. After
the terms and conditions under which the
change is to be made have been agreed to, the
change must be applied prospectively to this
contract, and the Disclosure Statement, if
affected, must be amended accordingly.
(ii) The Contractor shall, when the parties
agree to a change to a cost accounting
practice and the Contracting Officer has
made the finding required in 9903.201–6(c)
that the change is desirable and not
detrimental to the interests of the
Government, negotiate an equitable
adjustment as provided in the Changes clause
of this contract. In the absence of the
required finding, no agreement may be made
under this contract clause that will increase
costs paid by the United States.
(4) Agree to an adjustment of the contract
price or cost allowance, as appropriate, if the
Contractor or a subcontractor fails to comply
with the applicable CAS or to follow any cost
accounting practice, and such failure results
in any increased costs paid by the United
States. Such adjustment shall provide for
recovery of the increased costs to the United
States, together with interest thereon
computed at the annual rate established
under section 6621(a)(2) of the Internal
Revenue Code of 1986 (26 U.S.C. 6621(a)(2))
for such period, from the time the payment
by the United States was made to the time
the adjustment is effected.
(b) If the parties fail to agree whether the
Contractor has complied with an applicable
CAS rule, or regulation as specified in parts
9903 and 9904 and as to any cost adjustment
demanded by the United States, such failure
to agree will constitute a dispute under the
Contract Disputes Act (41 U.S.C. 601).
(c) The Contractor shall permit any
authorized representatives of the Government
to examine and make copies of any
documents, papers, and records relating to
compliance with the requirements of this
clause.
(d) The Contractor shall include in all
negotiated subcontracts, which the
Contractor enters into, the substance of this
clause, except paragraph (b), and shall
require such inclusion in all other
subcontracts of any tier, except that—
(1) If the subcontract is awarded to a
business unit which pursuant to 9903.201–2
is subject to other types of CAS coverage, the
substance of the applicable clause set forth in
9903.201–4 shall be inserted.
(2) This requirement shall apply only to
negotiated subcontracts in excess of
$500,000.
(3) The requirement shall not apply to
negotiated subcontracts otherwise exempt
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from the requirement to include a CAS clause
as specified in 9903.201–1.
(End of clause)
(d) [Reserved].
(e) Cost Accounting Standards—
Educational Institutions. (1) The
contracting officer shall insert the clause
set forth below, Cost Accounting
Standards—Educational Institution, in
negotiated contracts awarded to
educational institutions, unless the
contract is exempted (see 9903.201–1),
the contract is to be performed by an
FFRDC (see 9903.201–2(c)(5)), or the
provision at 9903.201–2(c)(6) applies.
(2) The clause below requires the
educational institution to comply with
all CAS specified in part 9905, to
disclose actual cost accounting practices
as required by 9903.202–1(f), and to
follow disclosed and established cost
accounting practices consistently.
Cost Accounting Standards—Educational
Institutions (June 2000)
(a) Unless the contract is exempt under
9903.201–1 and 9903.201–2, the provisions
of part 9903 are incorporated herein by
reference and the Contractor in connection
with this contract, shall—
(1) (CAS-covered Contracts Only) If a
business unit of an educational institution
required to submit a Disclosure Statement,
disclose in writing the Contractor’s cost
accounting practices as required by
9903.202–1 through 9903.202–5 including
methods of distinguishing direct costs from
indirect costs and the basis used for
accumulating and allocating indirect costs.
The practices disclosed for this contract shall
be the same as the practices currently
disclosed and applied on all other contracts
and subcontracts being performed by the
Contractor and which contain a Cost
Accounting Standards (CAS) clause. If the
Contractor has notified the Contracting
Officer that the Disclosure Statement
contains trade secrets, and commercial or
financial information which is privileged and
confidential, the Disclosure Statement shall
be protected and shall not be released outside
of the Government.
(2) Follow consistently the Contractor’s
cost accounting practices in accumulating
and reporting contract performance cost data
concerning this contract. If any change in
cost accounting practices is made for the
purposes of any contract or subcontract
subject to CAS requirements, the change
must be applied prospectively to this
contract and the Disclosure Statement, if
required, must be amended accordingly. If an
accounting principle change mandated under
Office of Management and Budget (OMB)
Circular A–21, Cost Principles for
Educational Institutions, requires that a
change in the Contractor’s cost accounting
practices be made after the date of this
contract award, the change must be applied
prospectively to this contract and the
Disclosure Statement, if required, must be
amended accordingly. If the contract price or
cost allowance of this contract is affected by
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such changes, adjustment shall be made in
accordance with subparagraph (a)(4) or (a)(5)
of this clause, as appropriate.
(3) Comply with all CAS, including any
modifications and interpretations indicated
thereto contained in 48 CFR part 9905, in
effect on the date of award of this contract
or, if the Contractor has submitted cost or
pricing data, on the date of final agreement
on price as shown on the Contractor’s signed
certificate of current cost or pricing data. The
Contractor shall also comply with any CAS
(or modifications to CAS) which hereafter
become applicable to a contract or
subcontract of the Contractor. Such
compliance shall be required prospectively
from the date of applicability to such contract
or subcontract.
(4)(i) Agree to an equitable adjustment as
provided in the Changes clause of this
contract if the contract cost is affected by a
change which, pursuant to subparagraph
(a)(3) of this clause, the Contractor is
required to make to the Contractor’s
established cost accounting practices.
(ii) Negotiate with the Contracting Officer
to determine the terms and conditions under
which a change may be made to a cost
accounting practice, other than a change
made under other provisions of subparagraph
(a)(4) of this clause; provided that no
agreement may be made under this provision
that will increase costs paid by the United
States.
(iii) When the parties agree to a change to
a cost accounting practice, other than a
change under subdivision (a)(4)(i) or (a)(4)(iv)
of this clause, negotiate an equitable
adjustment as provided in the Changes clause
of this contract.
(iv) Agree to an equitable adjustment as
provided in the Changes clause of this
contract, if the contract cost is materially
affected by an OMB Circular A–21
accounting principle amendment which, on
becoming effective after the date of contract
award, requires the Contractor to make a
change to the Contractor’s established cost
accounting practices.
(5) Agree to an adjustment of the contract
price or cost allowance, as appropriate, if the
Contractor or a subcontractor fails to comply
with an applicable Cost Accounting
Standard, or to follow any cost accounting
practice consistently and such failure results
in any increased costs paid by the United
States. Such adjustment shall provide for
recovery of the increased costs to the United
States, together with interest thereon
computed at the annual rate established
under section 6621(a)(2) of the Internal
Revenue Code of 1986 (26 U.S.C. 6621(a)(2))
for such period, from the time the payment
by the United States was made to the time
the adjustment is effected. In no case shall
the Government recover costs greater than
the increased cost to the Government, in the
aggregate, on the relevant contracts subject to
the price adjustment, unless the Contractor
made a change in its cost accounting
practices of which it was aware or should
have been aware at the time of price
negotiations and which it failed to disclose
to the Government.
(b) If the parties fail to agree whether the
Contractor or a subcontractor has complied
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with an applicable CAS or a CAS rule or
regulation in 9903 and as to any cost
adjustment demanded by the United States,
such failure to agree will constitute a dispute
under the Contract Disputes Act (41 U.S.C.
601).
(c) The Contractor shall permit any
authorized representatives of the Government
to examine and make copies of any
documents, papers, or records relating to
compliance with the requirements of this
clause.
(d) The Contractor shall include in all
negotiated subcontracts which the Contractor
enters into, the substance of this clause,
except paragraph (b), and shall require such
inclusion in all other subcontracts, of any
tier, including the obligation to comply with
all applicable CAS in effect on the
subcontractor’s award date or if the
subcontractor has submitted cost or pricing
data, on the date of final agreement on price
as shown on the subcontractor’s signed
Certificate of Current Cost or Pricing Data,
except that—
(1) If the subcontract is awarded to a
business unit which pursuant to 9903.201–2
is subject to other types of CAS coverage, the
substance of the applicable clause set forth in
9903.201–4 shall be inserted; and
(2) This requirement shall apply only to
negotiated subcontracts in excess of
$500,000.
(3) The requirement shall not apply to
negotiated subcontracts otherwise exempt
from the requirement to include a CAS clause
as specified in 9903.201–1.
32549
National Marine Fisheries
Service (NMFS), National Oceanic and
Atmospheric Administration (NOAA),
Commerce.
ACTION: Final rule.
catch (TAC) and days-at-sea (DAS) setaside program that helps vessel owners
defray the cost of carrying observers.
The following observer program
management measures are implemented
by this rule: Requirements for becoming
an approved observer service provider;
observer certification and decertification
criteria; and notification requirements
for vessel owners and/or operators. This
action also requires scallop vessel
owners, operators, or vessel managers to
procure certified fishery observers for
specified scallop fishing trips from an
approved observer service provider.
Additionally, this action allows
adjustments to the observer program to
be done through framework action.
DATES: Effective June 12, 2007.
ADDRESSES: Copies of Amendment 13,
the public hearing document, and the
Initial Regulatory Flexibility Analysis
(IRFA), are available upon request from
Paul J. Howard, Executive Director, New
England Fishery Management Council,
50 Water Street, Newburyport, MA
01950. These documents are also
available online at https://
www.nefmc.org. Amendment 13 is
categorically excluded from the
requirement to prepare an
environmental assessment or an
environmental impact statement. NMFS
prepared a Final Regulatory Flexibility
Analysis (FRFA), which is contained in
the Classification section of the
preamble of this final rule. Copies of the
FRFA and the Small Entity Compliance
Guide are available from the Regional
Administrator, Northeast Regional
Office, NMFS, One Blackburn Drive,
Gloucester, MA 01930–2298, and are
also available via the internet at
https://www.nero.nmfs.gov.
Written comments regarding the
burden-hour estimate or other aspects of
the collection-of-information
requirement contained in this final rule
should be submitted to the Regional
Administrator at the address above and
by e-mail to
David_Rostker@omb.eop.gov, or fax to
202–395–7285.
FOR FURTHER INFORMATION CONTACT:
Carrie Nordeen, Fishery Policy Analyst,
phone 978–281–9272, fax 978–281–
9135.
SUPPLEMENTARY INFORMATION:
This final rule implements
Amendment 13 to the Atlantic Sea
Scallop Fishery Management Plan
(Scallop FMP). Amendment 13 was
developed by the New England Fishery
Management Council (Council) to
permanently re-activate the industryfunded observer program in the Scallop
FMP through a scallop total allowable
Background
The Council adopted Amendment 13
to the Scallop FMP on February 7, 2007,
and submitted it to NMFS on February
16, 2007, for review and approval. The
Council developed Amendment 13 to
permanently re-active the industryfunded scallop observer program
implemented by NMFS via emergency
(End of clause)
[FR Doc. E7–11325 Filed 6–12–07; 8:45 am]
BILLING CODE 3110–01–P
DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric
Administration
50 CFR Part 648
[Docket No. 070322065–7114–02; I.D.
030607C]
RIN 0648–AV39
Fisheries of the Northeastern United
States; Atlantic Sea Scallop Fishery;
Amendment 13
AGENCY:
SUMMARY:
PO 00000
Frm 00033
Fmt 4700
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]]>Agencies
[Federal Register Volume 72, Number 113 (Wednesday, June 13, 2007)]
[Rules and Regulations]
[Pages 32546-32549]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-11325]
=======================================================================
-----------------------------------------------------------------------
OFFICE OF MANAGEMENT AND BUDGET
Office of Federal Procurement Policy
48 CFR Part 9903
Cost Accounting Standards Board (CAS); Applicability of Cost
Accounting Standards Coverage
AGENCY: Cost Accounting Standards Board, Office of Federal Procurement
Policy, OMB.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Office of Federal Procurement Policy, Cost Accounting
Standards (CAS) Board, has adopted, without change from the interim
rule, a final rule revising the criteria applicable to United Kingdom
(UK) contractors for filing a Disclosure Statement, Form No. CASB DS-1.
This rulemaking is authorized pursuant to Section 26 of the Office of
Federal Procurement Policy Act.
EFFECTIVE DATE: June 13, 2007.
FOR FURTHER INFORMATION CONTACT: Laura Auletta, Manager, Cost
Accounting Standards Board, 725 17th Street, NW., Room 9013,
Washington, DC 20503 (telephone: 202-395-3256).
SUPPLEMENTARY INFORMATION:
A. Background
On May 23, 2005, the Cost Accounting Standards Board published an
interim rule with request for comment (70 FR 29457) for the purpose of
revising the criteria applicable to United Kingdom (UK) contractors for
filing a Disclosure Statement, Form No. CASB DS-1. The interim rule was
adopted in order to comply with a specific request by the UK Ministry
of Defence (MOD) to simplify the compliance process with CAS Board
disclosure requirements for UK contractors.
Unlike certain other foreign contractors, UK contractors have been
required to file a CASB DS-1 in accordance with CAS regulations. The
MOD initially approached the Board with a request that UK contractors
be permitted to use the corresponding UK form ``Questionnaire on Method
of Allocation of Costs'' (QMAC), in lieu of the CASB DS-1. After a
review of the content of the QMAC, the UK and U.S. representatives
agreed that it did not have the same scope as the CASB DS-1. Therefore,
it was agreed that to cover the gap in the coverage a ``Supplemental
QMAC'' was needed.
Based upon the Board's approval of a Supplemental QMAC that is
acceptable to the MOD, the MOD requested that the CAS Board allow UK
contractors to submit their basic QMAC, together with the Supplemental
QMAC, in lieu of the DS-1. At its meeting on February 23, 2005, the
Board agreed to change the CAS requirements so that UK contractors with
CAS-covered contracts may file the UK QMAC together with its Supplement
in lieu of the CASB DS-1 required of U.S. contractors. In conjunction
with this change, the Board also agreed to eliminate the specific
paragraph addressing UK contractors at 9903.201-1(b)(12). As a result,
UK contractors are subject to the requirements of 9903.201-1(b)(4),
i.e., contracts and subcontracts with UK contractors are exempt from
CAS ``insofar as the requirements of CAS other than 9904.401 and
9904.402 are concerned.'' The May, 2005 interim rule reflected these
Board approved revisions.
B. Public Comments
The Board received one set of public comments in response to the
Interim Rule.
1. CAS Coverage for UK Contractors
Comment: The commenter requested confirmation that the rule
requires that UK contractors comply only with CAS 401 and 402.
Response: The language in the final rule requires that all UK
contractors performing U.S. Government contracts and not otherwise
exempt under 48 CFR
[[Page 32547]]
9903.201-1 will be required to comply only with CAS 401 and 402 in
accordance with 48 CFR 9903.201-1(b)(4).
2. Extent of Disclosure Requirement
Comment: The commenter expressed concern that UK contractors are
subject to more extensive disclosure requirements than other countries
listed in 48 CFR 9903.201-4(e) by virtue of the QMAC Supplement.
Response: The Board believes that the disclosure requirements for
UK contractors provide the information necessary for the UK MOD to
determine whether such contractors are complying with the provisions of
CAS 401 and 402. The MOD initially requested that its contractors be
permitted to file only the QMAC. However, as described in the
Background section above, the Board determined that the QMAC, by
itself, did not provide sufficient information about the accounting
practices of UK contractors. Therefore, working jointly with the MOD,
the QMAC supplement was developed to minimize duplicate disclosures
while providing the additional information needed to cover the gap
between the QMAC and CASB DS-1.
C. Paperwork Reduction Act
The Paperwork Reduction Act, Public Law 96-511, does not apply to
this rulemaking, because this rule imposes no paperwork burden on
offerors, affected contractors and subcontractors, or members of the
public which requires the approval of OMB under 44 U.S.C. 3501, et seq.
D. Executive Order 12866 and the Regulatory Flexibility Act
The Board certifies that this rule will not have a significant
effect on a substantial number of small entities within the meaning of
the Regulatory Flexibility Act, 5. U.S.C. 601, et seq., because small
businesses are exempt from the application of the Cost Accounting
Standards.
List of Subjects in 48 CFR Part 9903
Accounting, Government procurement.
Paul A. Denett,
Administrator, Office of Federal Procurement Policy.
0
For the reasons set forth in this preamble, Chapter 99 of title 48 of
the Code of Federal Regulations is amended as set forth below. Please
note that, in publishing the interim rule, the Code of Federal
Regulations inadvertently removed and reserved paragraph (d) of the
first clause under Section 9903.201-4 entitled ``Cost Accounting
Standards (June 2000)'' instead of paragraph (d) of the section. This
final rule corrects that error and, for clarity, restates the section
in its entirety. Therefore, the interim final rule published at 70 FR
29457, May 23, 2005, is adopted as final with the following changes.
PART 9903--CONTRACT COVERAGE
0
1. The authority citation for part 9903 continues to read as follows:
Authority: Pub. L. 100-679, 102 Stat. 4056, 41 U.S.C. 422.
Subpart 9903.2--CAS Program Requirements
0
2. Section 9903.201-4 is revised to read as follows:
9903.201-4 Contract clauses.
(a) Cost Accounting Standards. (1) The contracting officer shall
insert the clause set forth below, Cost Accounting Standards, in
negotiated contracts, unless the contract is exempted (see 9903.201-1),
the contract is subject to modified coverage (see 9903.201-2), or the
clause prescribed in paragraph (e) of this section is used.
(2) The clause below requires the contractor to comply with all CAS
specified in part 9904, to disclose actual cost accounting practices
(applicable to CAS-covered contracts only), and to follow disclosed and
established cost accounting practices consistently.
Cost Accounting Standards (June 2000)
(a) Unless the contract is exempt under 9903.201-1 and 9903.201-
2, the provisions of 9903 are incorporated herein by reference and
the Contractor in connection with this contract, shall--
(1) (CAS-covered Contracts Only) By submission of a Disclosure
Statement, disclosed in writing the Contractor's cost accounting
practices as required by 9903.202-1 through 9903.202-5 including
methods of distinguishing direct costs from indirect costs and the
basis used for allocating indirect costs. The practices disclosed
for this contract shall be the same as the practices currently
disclosed and applied on all other contracts and subcontracts being
performed by the Contractor and which contain a Cost Accounting
Standards (CAS) clause. If the Contractor has notified the
Contracting Officer that the Disclosure Statement contains trade
secrets, and commercial or financial information which is privileged
and confidential, the Disclosure Statement shall be protected and
shall not be released outside of the Government.
(2) Follow consistently the Contractor's cost accounting
practices in accumulating and reporting contract performance cost
data concerning this contract. If any change in cost accounting
practices is made for the purposes of any contract or subcontract
subject to CAS requirements, the change must be applied
prospectively to this contract and the Disclosure Statement must be
amended accordingly. If the contract price or cost allowance of this
contract is affected by such changes, adjustment shall be made in
accordance with subparagraph (a)(4) or (a)(5) of this clause, as
appropriate.
(3) Comply with all CAS, including any modifications and
interpretations indicated thereto contained in part 9904, in effect
on the date of award of this contract or, if the Contractor has
submitted cost or pricing data, on the date of final agreement on
price as shown on the Contractor's signed certificate of current
cost or pricing data. The Contractor shall also comply with any CAS
(or modifications to CAS) which hereafter become applicable to a
contract or subcontract of the Contractor. Such compliance shall be
required prospectively from the date of applicability of such
contract or subcontract.
(4)(i) Agree to an equitable adjustment as provided in the
Changes clause of this contract if the contract cost is affected by
a change which, pursuant to subparagraph (a)(3) of this clause, the
Contractor is required to make to the Contractor's established cost
accounting practices.
(ii) Negotiate with the Contracting Officer to determine the
terms and conditions under which a change may be made to a cost
accounting practice, other than a change made under other provisions
of subparagraph (a)(4) of this clause; provided that no agreement
may be made under this provision that will increase costs paid by
the United States.
(iii) When the parties agree to a change to a cost accounting
practice, other than a change under subdivision (a)(4)(i) of this
clause, negotiate an equitable adjustment as provided in the Changes
clause of this contract.
(5) Agree to an adjustment of the contract price or cost
allowance, as appropriate, if the Contractor or a subcontractor
fails to comply with an applicable Cost Accounting Standard, or to
follow any cost accounting practice consistently and such failure
results in any increased costs paid by the United States. Such
adjustment shall provide for recovery of the increased costs to the
United States, together with interest thereon computed at the annual
rate established under section 6621(a)(2) of the Internal Revenue
Code of 1986 (26 U.S.C. 6621(a)(2)) for such period, from the time
the payment by the United States was made to the time the adjustment
is effected. In no case shall the Government recover costs greater
than the increased cost to the Government, in the aggregate, on the
relevant contracts subject to the price adjustment, unless the
Contractor made a change in its cost accounting practices of which
it was aware or should have been aware at the time of price
negotiations and which it failed to disclose to the Government.
(b) If the parties fail to agree whether the Contractor or a
subcontractor has complied with an applicable CAS in part 9904 or a
CAS rule or regulation in part 9903 and as to any cost adjustment
demanded by the United States, such failure to agree will
[[Page 32548]]
constitute a dispute under the Contract Disputes Act (41 U.S.C.
601).
(c) The Contractor shall permit any authorized representatives
of the Government to examine and make copies of any documents,
papers, or records relating to compliance with the requirements of
this clause.
(d) The contractor shall include in all negotiated subcontracts
which the Contractor enters into, the substance of this clause,
except paragraph (b), and shall require such inclusion in all other
subcontracts, of any tier, including the obligation to comply with
all CAS in effect on the subcontractor's award date or if the
subcontractor has submitted cost or pricing data, on the date of
final agreement on price as shown on the subcontractor's signed
Certificate of Current Cost or Pricing Data. If the subcontract is
awarded to a business unit which pursuant to 9903.201-2 is subject
to other types of CAS coverage, the substance of the applicable
clause set forth in 9903.201-4 shall be inserted. This requirement
shall apply only to negotiated subcontracts in excess of $500,000,
except that the requirement shall not apply to negotiated
subcontracts otherwise exempt from the requirement to include a CAS
clause as specified in 9903.201-1.
(End of clause)
(b) [Reserved].
(c) Disclosure and Consistency of Cost Accounting Practices. (1)
The contracting officer shall insert the clause set forth below,
Disclosure and Consistency of Cost Accounting Practices, in negotiated
contracts when the contract amount is over $500,000 but less than $50
million, and the offeror certifies it is eligible for and elects to use
modified CAS coverage (see 9903.201-2, unless the clause prescribed in
paragraph (d) of this subsection is used).
(2) The clause below requires the contractor to comply with CAS
9904.401, 9904.402, 9904.405, and 9904.406, to disclose (if it meets
certain requirements) actual cost accounting practices, and to follow
consistently disclosed and established cost accounting practices.
Disclosure and Consistency of Cost Accounting Practices (June 2000)
(a) The Contractor, in connection with this contract, shall--
(1) Comply with the requirements of 9904.401, Consistency in
Estimating, Accumulating, and Reporting Costs; 9904.402, Consistency
in Allocating Costs Incurred for the Same Purpose; 9904.405,
Accounting for Unallowable Costs; and 9904.406, Cost Accounting
Standard--Cost Accounting Period, in effect on the date of award of
this contract, as indicated in part 9904.
(2) (CAS-covered Contracts Only) If it is a business unit of a
company required to submit a Disclosure Statement, disclose in
writing its cost accounting practices as required by 9903.202-1
through 9903.202-5. If the Contractor has notified the Contracting
Officer that the Disclosure Statement contains trade secrets and
commercial or financial information which is privileged and
confidential, the Disclosure Statement shall be protected and shall
not be released outside of the Government.
(3)(i) Follow consistently the Contractor's cost accounting
practices. A change to such practices may be proposed, however, by
either the Government or the Contractor, and the Contractor agrees
to negotiate with the Contracting Officer the terms and conditions
under which a change may be made. After the terms and conditions
under which the change is to be made have been agreed to, the change
must be applied prospectively to this contract, and the Disclosure
Statement, if affected, must be amended accordingly.
(ii) The Contractor shall, when the parties agree to a change to
a cost accounting practice and the Contracting Officer has made the
finding required in 9903.201-6(c) that the change is desirable and
not detrimental to the interests of the Government, negotiate an
equitable adjustment as provided in the Changes clause of this
contract. In the absence of the required finding, no agreement may
be made under this contract clause that will increase costs paid by
the United States.
(4) Agree to an adjustment of the contract price or cost
allowance, as appropriate, if the Contractor or a subcontractor
fails to comply with the applicable CAS or to follow any cost
accounting practice, and such failure results in any increased costs
paid by the United States. Such adjustment shall provide for
recovery of the increased costs to the United States, together with
interest thereon computed at the annual rate established under
section 6621(a)(2) of the Internal Revenue Code of 1986 (26 U.S.C.
6621(a)(2)) for such period, from the time the payment by the United
States was made to the time the adjustment is effected.
(b) If the parties fail to agree whether the Contractor has
complied with an applicable CAS rule, or regulation as specified in
parts 9903 and 9904 and as to any cost adjustment demanded by the
United States, such failure to agree will constitute a dispute under
the Contract Disputes Act (41 U.S.C. 601).
(c) The Contractor shall permit any authorized representatives
of the Government to examine and make copies of any documents,
papers, and records relating to compliance with the requirements of
this clause.
(d) The Contractor shall include in all negotiated subcontracts,
which the Contractor enters into, the substance of this clause,
except paragraph (b), and shall require such inclusion in all other
subcontracts of any tier, except that--
(1) If the subcontract is awarded to a business unit which
pursuant to 9903.201-2 is subject to other types of CAS coverage,
the substance of the applicable clause set forth in 9903.201-4 shall
be inserted.
(2) This requirement shall apply only to negotiated subcontracts
in excess of $500,000.
(3) The requirement shall not apply to negotiated subcontracts
otherwise exempt from the requirement to include a CAS clause as
specified in 9903.201-1.
(End of clause)
(d) [Reserved].
(e) Cost Accounting Standards--Educational Institutions. (1) The
contracting officer shall insert the clause set forth below, Cost
Accounting Standards--Educational Institution, in negotiated contracts
awarded to educational institutions, unless the contract is exempted
(see 9903.201-1), the contract is to be performed by an FFRDC (see
9903.201-2(c)(5)), or the provision at 9903.201-2(c)(6) applies.
(2) The clause below requires the educational institution to comply
with all CAS specified in part 9905, to disclose actual cost accounting
practices as required by 9903.202-1(f), and to follow disclosed and
established cost accounting practices consistently.
Cost Accounting Standards--Educational Institutions (June 2000)
(a) Unless the contract is exempt under 9903.201-1 and 9903.201-
2, the provisions of part 9903 are incorporated herein by reference
and the Contractor in connection with this contract, shall--
(1) (CAS-covered Contracts Only) If a business unit of an
educational institution required to submit a Disclosure Statement,
disclose in writing the Contractor's cost accounting practices as
required by 9903.202-1 through 9903.202-5 including methods of
distinguishing direct costs from indirect costs and the basis used
for accumulating and allocating indirect costs. The practices
disclosed for this contract shall be the same as the practices
currently disclosed and applied on all other contracts and
subcontracts being performed by the Contractor and which contain a
Cost Accounting Standards (CAS) clause. If the Contractor has
notified the Contracting Officer that the Disclosure Statement
contains trade secrets, and commercial or financial information
which is privileged and confidential, the Disclosure Statement shall
be protected and shall not be released outside of the Government.
(2) Follow consistently the Contractor's cost accounting
practices in accumulating and reporting contract performance cost
data concerning this contract. If any change in cost accounting
practices is made for the purposes of any contract or subcontract
subject to CAS requirements, the change must be applied
prospectively to this contract and the Disclosure Statement, if
required, must be amended accordingly. If an accounting principle
change mandated under Office of Management and Budget (OMB) Circular
A-21, Cost Principles for Educational Institutions, requires that a
change in the Contractor's cost accounting practices be made after
the date of this contract award, the change must be applied
prospectively to this contract and the Disclosure Statement, if
required, must be amended accordingly. If the contract price or cost
allowance of this contract is affected by
[[Page 32549]]
such changes, adjustment shall be made in accordance with
subparagraph (a)(4) or (a)(5) of this clause, as appropriate.
(3) Comply with all CAS, including any modifications and
interpretations indicated thereto contained in 48 CFR part 9905, in
effect on the date of award of this contract or, if the Contractor
has submitted cost or pricing data, on the date of final agreement
on price as shown on the Contractor's signed certificate of current
cost or pricing data. The Contractor shall also comply with any CAS
(or modifications to CAS) which hereafter become applicable to a
contract or subcontract of the Contractor. Such compliance shall be
required prospectively from the date of applicability to such
contract or subcontract.
(4)(i) Agree to an equitable adjustment as provided in the
Changes clause of this contract if the contract cost is affected by
a change which, pursuant to subparagraph (a)(3) of this clause, the
Contractor is required to make to the Contractor's established cost
accounting practices.
(ii) Negotiate with the Contracting Officer to determine the
terms and conditions under which a change may be made to a cost
accounting practice, other than a change made under other provisions
of subparagraph (a)(4) of this clause; provided that no agreement
may be made under this provision that will increase costs paid by
the United States.
(iii) When the parties agree to a change to a cost accounting
practice, other than a change under subdivision (a)(4)(i) or
(a)(4)(iv) of this clause, negotiate an equitable adjustment as
provided in the Changes clause of this contract.
(iv) Agree to an equitable adjustment as provided in the Changes
clause of this contract, if the contract cost is materially affected
by an OMB Circular A-21 accounting principle amendment which, on
becoming effective after the date of contract award, requires the
Contractor to make a change to the Contractor's established cost
accounting practices.
(5) Agree to an adjustment of the contract price or cost
allowance, as appropriate, if the Contractor or a subcontractor
fails to comply with an applicable Cost Accounting Standard, or to
follow any cost accounting practice consistently and such failure
results in any increased costs paid by the United States. Such
adjustment shall provide for recovery of the increased costs to the
United States, together with interest thereon computed at the annual
rate established under section 6621(a)(2) of the Internal Revenue
Code of 1986 (26 U.S.C. 6621(a)(2)) for such period, from the time
the payment by the United States was made to the time the adjustment
is effected. In no case shall the Government recover costs greater
than the increased cost to the Government, in the aggregate, on the
relevant contracts subject to the price adjustment, unless the
Contractor made a change in its cost accounting practices of which
it was aware or should have been aware at the time of price
negotiations and which it failed to disclose to the Government.
(b) If the parties fail to agree whether the Contractor or a
subcontractor has complied with an applicable CAS or a CAS rule or
regulation in 9903 and as to any cost adjustment demanded by the
United States, such failure to agree will constitute a dispute under
the Contract Disputes Act (41 U.S.C. 601).
(c) The Contractor shall permit any authorized representatives
of the Government to examine and make copies of any documents,
papers, or records relating to compliance with the requirements of
this clause.
(d) The Contractor shall include in all negotiated subcontracts
which the Contractor enters into, the substance of this clause,
except paragraph (b), and shall require such inclusion in all other
subcontracts, of any tier, including the obligation to comply with
all applicable CAS in effect on the subcontractor's award date or if
the subcontractor has submitted cost or pricing data, on the date of
final agreement on price as shown on the subcontractor's signed
Certificate of Current Cost or Pricing Data, except that--
(1) If the subcontract is awarded to a business unit which
pursuant to 9903.201-2 is subject to other types of CAS coverage,
the substance of the applicable clause set forth in 9903.201-4 shall
be inserted; and
(2) This requirement shall apply only to negotiated subcontracts
in excess of $500,000.
(3) The requirement shall not apply to negotiated subcontracts
otherwise exempt from the requirement to include a CAS clause as
specified in 9903.201-1.
(End of clause)
[FR Doc. E7-11325 Filed 6-12-07; 8:45 am]
BILLING CODE 3110-01-P
