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					                      PRENEGOTIATION OBJECTIVES MEMORANDUM TEMPLATE

              GENERAL INFORMATION:

                 Contractor name___________________________________
                 Request for proposal number_________________________
                 Request for proposal date____________________________
                 Proposal number___________________________________
                 Proposal date_____________________________________
                 Proposal amount___________________________________
                 Date negotiation scheduled_________________________


              DESCRIPTION OF THE CONTRACT ACTION:

                 Purpose of negotiation (e.g., negotiate a new contract on sole source basis, definitization of a
              change order, negotiate an equitable adjustment):


                 Description of the work (provide a brief summary of the work encompassed by the action):


              APPROVALS AND COMPLIANCES:

                 Identify authority to negotiate _____________
                 Justification and Approval (J&A) Yes/Date__________ No______
                 Small Business subcontracting plan (FAR 19.702) is_____ is not _____applicable.
                 EEO clearance received (FAR 22.805) Yes_____ No_____ NA______
                 Offeror is not on the Debarred, Ineligible & Suspended Bidder List (FAR 9.4).


              SUMMARY OF THE CONTRACTOR’S PROPOSAL AND THE GOVERNMENT
              (NEGOTIATOR’S) OBJECTIVE:

                                                      Government        Government       Government          Variance
                     Contractor        DCAA            Minimum           Maximum         Negotiation       (Proposal less
                      Proposal       Recommend         Objective         Objective        Objective       Gov’t Objective)
Total Cost

Profit/Fee

Total Price
              Note: Some CMOs may choose to only show the “Government objective” rather than minimum,
              Government objective, maximum amounts. However, the DCAA position and deviations there
              from should be documented as appropriate.


                                                   FOR OFFICIAL USE ONLY
NEGOTIATING PARTIES:

   Identify the name position, organization and phone number/email of each person representing
the contractor and the Government in the negotiation. Indicate the date(s) the negotiation is
scheduled.


   Contractor             Name                Position          Organization          Phone/Email




  Government              Name                Position          Organization          Phone/Email




CURRENT STATUS OF CONTRACTOR’S SYSTEMS:

   Discuss the current status of the contractor’s systems, (e.g., purchasing, estimating,
accounting and material management and accounting system) to the extent they affected and
were considered in establishing the Government’s prenegotiation objectives (FAR 15.406-3). In
particular:

         Indicate the status of contractor’s systems.
         Indicate any contractor systems that will impact negotiations.
         Indicate the status of the contactor’s disclosure statement describing the contractor’s
cost accounting practices and procedures, and the date of the disclosure (FAR 30.202).
         Indicate whether the disclosure statement is adequate.


COST OR PRICING DATA:

   Discuss the extent to which the negotiator relied on cost or pricing data in establishing the
negotiation position.


   If cost or pricing data were not required in the case of a price negotiation exceeding the cost
or pricing data threshold, the exception used and the basis for it (FAR 15.406-3)


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                                     FOR OFFICIAL USE ONLY
       COST ANALYSIS:

          The cost analysis table below provides an example of the major cost elements usually
       contained in a contractor’s proposal. The table may be tailored to reflect the unique costs
       elements in the proposal and to meet the needs of the negotiator.

                                         COST ANALYSIS TABLE


                                                                                                            Variance
   Cost Element                                        Govt.            Govt.            Govt.             (Proposal
                       Contractor      DCAA           Minimum          Maximum         Negotiation         less Govt.
                        Proposal     Recommend        Objective        Objective        Objective             Obj.)
1. Direct Labor
2. Labor Overhead
3. Equipment
4. Material
5. Material
Overhead
6. Travel
7. Consultants
8. Subcontracts
9. Other Direct
Costs
Subtotal
10. G&A
Subtotal
11. Facility Capital
   Cost of Money
Total Cost
12. Profit/Fee
13. Total Price

          Complete the cost analysis table when a cost analysis is required. In addition, the negotiator
       shall:

              Indicate and discuss in a separately numbered paragraph each cost element in the
       contractor’s proposal.

               Indicate the Government objective for each cost element. Discuss how the negotiator
       reached the Government objective considering cost and price analysis, technical analysis and
       audit reviews.



                                                        3


                                            FOR OFFICIAL USE ONLY
       Indicate and discuss any disagreement with the cost and price analysis, technical analysis
and audit. Indicate supporting rationale for these differences. Discuss whether the differences
were reconciled, and if not reconciled, why the differences could not be resolved.

      Discuss the basis for the profit/fee prenegotiation objective (DFARS 215.404-4 and
215.404-70).

               Attach DD Form 1547, Record of Weighted Guidelines (DFARS 215.406-3).

                Provide rationale for weights and values assigned to each element of performance
risk and rationale for the value assigned to contract type risk.

              Address the rationale for not using the weighted guidelines method (DFARS
215.404(c)(2)(B) and (c)(2)(C)).

       Discuss the total price and identify the basis for price reasonableness.

SIGNIFICANT FACTS AND IMPACTS BY OTHERS:

   Indicate the most significant facts or considerations controlling the establishment of the
prenegotiation objectives.

   To the extent such direction has a significant effect on the action, a discussion and
quantification of the impact of the direction given by Congress, other agencies, higher-level
officials (i.e., officials who would not normally exercise authority during the award and review
process for the instant contract action).


DOCUMENTATION USED TO DEVELOP THE PRENEGOTIATION OBJECTIVES:

   Indicate the following documents used in establishing the Government prenegotiation
objectives (Check all that are applicable)

       Cost and price analysis_____
       Technical analysis_____
       DCAA audit report_____
       Past performance reports______
       Other (list) ____




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                                     FOR OFFICIAL USE ONLY
DOCUMENTS ATTACHED TO THE PRENEGOTIATION MEMORANDUM:

  List all attachments.




PRINCIPAL NEGOTIATOR                                        DATE
TITLE

_____________________________________                   ______________
ADMINISTRATIVE CONTRACTING OFFICER                           DATE
 (If the ACO is not the principal negotiator)



APPROVING OFFICIAL                                           DATE
TITLE




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                                FOR OFFICIAL USE ONLY

				
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