Course Curriculum

1. Background of Contractors' Purchasing System Requirement

1. Why the Government is concerned
2. Applicability of purchasing systems
3. Contract type considerations
4. Impact of inadequate purchasing system
   

2. Requirements for Formal CPSR (Contractors' Purchasing
System Review)

1. Thresholds for review
2. Three year requirement
3. Subcontract types evaluated in CPSR
4. Contracting officer cognizance
5. Government auditor (e.g. DCAA) involvement
6. Other Government purchasing system audits
7. Audit planning and preparation

3. Subcontract Consent and Advance Notification
Requirements Under FAR

1. Background
2. CPSR opinion impact on requirements
3. Guidelines for preparing consent documentation
4. Potential impact of not obtaining required Government
   consent

4. CPSR Criteria Under FAR

1. Degree of competition
2. Pricing policies and techniques
3. Methods to evaluate subcontractor responsibility
4. Treatment of affiliates and partners
5. Policies and procedures pertaining to small business
6. Planning, award and post-award management
7. CAS compliance requirements
8. Appropriateness of subcontract types
9. Management control systems

5. Government Surveillance

1. Government reporting requirements to contractor
2. Disclosure of subcontract CPSR approval status to prime
3. Granting approval
4. Withholding or withdrawal of approval
    Cost or pricing data
    Implementation of CAS
    Advance notification
    Small business subcontracting

6. Cost Analysis of Proposed Subcontract

1. Applicability
2. Guidelines for performing cost analysis

7. Price Analysis of Proposed Subcontract

1. Applicability
2. Guidelines for performing price analysis

8. Government Purchasing Fraud Risk Indicators

1. Incurred cost audits (kickbacks)
2. Defective pricing audits (intentional overpricing)
3. Make or buy decision changes (intentional overpricing)

9. Purchasing System Internal Control Structure

1. DCAA internal control matrix
    Contractor compliance - training, policies and procedures
    Purchase orders and subcontract clauses
    Management of purchasing
    Selecting sources
    Pricing and negotiation
    Subcontract award and administration
2. Contractor control environment impact to audits
3. Leveraging SOX (Sarbanes-Oxley) purchasing internal control
   documentation
4. Influencing scope of Government audits

10. Subcontract Management

1. Socioeconomic considerations, prime contractor obligations
    Subcontractor obligations
    Liquidated damages
    EEO (Equal Employment Opportunity) pre-award clearance
2. Preparation for on-site visit
    Entrance conference
    Working space
    Random purchase order audit
    Exit conference
3. Audit protocol
    Preparation of personnel
    Liaison responsibilities
    Answering questions
    Real-time fixes
4. Financing
5. Subcontract closeout