52.230-3 Disclosure and Consistency of Cost

Accounting Practices.

As prescribed in 30.201-4(b)(1), insert the following clause:

Disclosure and Consistency of Cost Accounting Practices (Jun 2020)

(a) The Contractor, in connection with this contract, shall-

(1) Comply with the requirements of 48 CFR 9904.401, Consistency in Estimating, Accumulating,

and Reporting Costs; 48 CFR 9904.402, Consistency in Allocating Costs Incurred for the Same

Purpose; 48 CFR 9904.405, Accounting for Unallowable Costs; and 48 CFR 9904.406, Cost

Accounting Standard-Cost Accounting Period, in effect on the date of award of this contract as

indicated in 48 CFR 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 48 CFR

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 48 CFR 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

of1986 (26 U.S.C.6621(a)(2)), 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 48 CFR 9903 and 9904 and as to any cost adjustment demanded by the

United States, such failure to agree will constitute a dispute under 41 U.S.C. chapter 71, Contract
Disputes.

(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 48 CFR 9903.201-2 is subject

to other types of CAS coverage, the substance of the applicable clause set forth in section 30.201-4

of the Federal Acquisition Regulation (FAR) shall be inserted.

(2) The requirement in this paragraph (d) shall apply only to negotiated subcontracts in excess of the

lower CAS threshold specified in FAR 30.201-4(b) on the date of subcontract award.

(3) The requirement shall not apply to negotiated subcontracts otherwise exempt from the

requirement to include a CAS clause as specified in 48 CFR 9903.201-1.

(End of clause)

Parent topic: 52.230 [Reserved]