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                            42.709-4 Assessing the penalty.
        
                  FAR
FAR
FAC Number: 2024-03 Effective Date: 02/23/2024
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Subpart42.042.142.242.342.442.542.642.742.842.942.1142.1242.1342.1542.1642.17
Section42.70042.70142.70242.70342.70442.70542.70642.70742.70842.709
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42.709-4 Assessing the penalty.42.709-4 Assessing the penalty.       Unless a waiver is granted pursuant to                  42.709-6, the cognizant contracting officer shall-                                       (a) Assess the penalty in                        42.709-2(a)(1), when the submitted cost is expressly unallowable under a cost principle in the FAR or an executive agency supplement that defines the allowability of specific selected costs; or                                          (b) Assess the penalty in                        42.709-2(a)(2), when the submitted cost was determined to be unallowable for that contractor prior to submission of the proposal. Prior determinations of unallowability may be evidenced by-                                                         (1) A DCAA Form1, Notice of Contract Costs Suspended and/or Disapproved (see 48 CFR 242.705-2), or any similar notice which the contractor elected not to appeal and was not withdrawn by the cognizant Government agency;                                                            (2) A contracting officer final decision which was not appealed;                                                            (3) A prior executive agency Board of Contract Appeals or court decision involving the contractor, which upheld the cost disallowance; or                                                            (4) A determination or agreement of unallowability under  31.201-6.                                                                             (c) Issue a final decision (see  33.211) which includes a demand for payment of any penalty assessed under paragraph (a) or (b) of this section. The letter shall state that the determination is a final decision under the Disputes clause of the contract. (Demanding payment of the penalty is separate from demanding repayment of any paid portion of the disallowed cost.)    **Parent topic:**  42.709 Penalties for Unallowable Costs.
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