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PREPARING A COST PROPOSAL

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PREPARING A COST PROPOSAL Powered By Docstoc
					PREPARING COST
    PROPOSALS



  Andrea O’Neill
 Cost/Price Analyst
     ACC-RSA
               AGENDA
 Elements of a Proposal;
 Proposal Example
   Indirect Rate Calculations
   Unallowable Costs;
 Preparing For Negotiations; and
 Common Deficiencies Found in Proposals.
  ELEMENTS OF A PROPOSAL
 Cover Sheet (FAR 15.408, Table 15-2 I.A.)
 Summary by Cost Element
 Direct Labor (Table 15-2 II.B.)
 Indirect Costs (Table 15-2 II.C.)
 Other Costs (Table 15-2 II.D.)
 Profit/Fixed Fee (FAR 15.404-4)
  ELEMENTS OF A PROPOSAL
 Basis of Estimate
   Indirect rate computation and
    application;
   Cost breakdowns and budgetary data
 Other information requested in RFP,
  Section L.
SAMPLE PROPOSAL
              TECHNICAL
                SUPPORT
              CONTRACT
   PROPOSAL REQUIREMENTS
XYZ Technologies, Inc. has just submitted a proposal to the
  Federal Government for the task of surveying an
  environmentally sensitive plot of land for the construction
  of a complex Government Building.
XYZ Technologies, Inc. does not have the expertise to handle
  the suspected pollutants believed to be under the site. XYZ
  Technologies, Inc. subcontracted certain aspects of the
  environmental site work to Enviro, Inc. the only firm in
  the state that has the current technology to perform the
  necessary testing.
Because the proposal is greater than the cost or pricing data
  threshold, a cost analysis will be performed on the
  proposal.
      PROPOSAL SUBMISSION
 See sample proposal in excel file.
      PROPOSAL EXERCISE
      DIRECT LABOR (Sch 1)
 Support the proposed labor cost of
  $338,000;
 Provide the basis for the hours and hourly
  rates.
   Example: Hours are based on Contract
    ABC which was performed in FY 2011 and
    was similar to this effort. The hourly
    rates are based on current average rates
    paid to those labor categories. Payroll
    records are available upon request.
     PROPOSAL EXERCISE
 SUBCONTRACTOR COST (Sch 2b)
 Support the proposed subcontractor cost of
  $115,948;
 Provide a cost/price analysis on Enviro, Inc.
  (FAR 15.404-3).
 If subcontract is based on competition,
  then provide quotes from the other bidders
  and an explanation why this one was
  selected;
 Subcontractor generally provides
  unsanitized proposal directly to
  Government.
         PROPOSAL EXERCISE
       INDIRECT RATES (Sch 4)
 Provide budgetary data on how indirect
  rates were calculated;
 Provide basis of estimate.
        PROPOSAL EXERCISE
     BILL OF MATERIAL (Sch 3)
 Either provide quotes for items in BOM or
  have readily available for review;
 If sole source procurement, then provide
  justification.
       UNALLOWABLE COSTS
 Determining Allowability (FAR 31.201-2);
 Reasonableness;
 Allocability;
 GAAP and practices appropriate to the
  particular circumstances;
 Terms of the Contract.
           PREPARING FOR
           NEGOTIATIONS
• Personnel to bring to the negotiation table:
   • Authorized personnel to bind the
     company
   • Technical personnel familiar with
     estimates
   • Cost estimator who prepared the
     proposal
• Data related to the proposed costs
• Updated information since original
      COMMON DEFICIENCIES
•   Lack of supporting data
•   No Basis of Estimate (BOE)
•   Not complying with RFP instructions
•   Math Errors
•   Summary and supporting schedules not
    tying
            REFERENCES
• FAR PART 15 – Contracting By Negotiation
• FAR PART 31 – Contract Cost Principles
• DCAA’s Information for Contractors
    • www.dcaa.mil
• Contract Pricing Reference Guide
    • https://acc.dau.mil/cprg
QUESTIONS

				
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