FAC Contracting Principles & Regulations 3 — Questions and Answers
Question 1: A contracting officer awards a contract without obtaining the required written justification for other-than-full-and-open competition. What is the most likely consequence?
- The contract is automatically void
- GAO may sustain a bid protest and recommend corrective action (Correct answer)
- The contractor must refund all payments
- The contracting officer loses their warrant permanently
Correct answer: GAO may sustain a bid protest and recommend corrective action
GAO can sustain a bid protest challenging the lack of proper J&A documentation and recommend corrective action such as re-competition or termination.
Question 2: Which FAR clause requires contractors to maintain an adequate accounting system as a condition for receiving cost-reimbursement contracts?
- FAR 52.215-2 (Correct answer)
- FAR 52.232-20
- FAR 52.215-10
- FAR 52.209-6
Correct answer: FAR 52.215-2
FAR 52.215-2 (Audit and Records — Negotiation) requires contractors to maintain adequate accounting records accessible to government auditors for cost-reimbursement work.
Question 3: Under FAR Part 9, a contractor is debarred. What is the standard debarment period?
- 6 months to 1 year
- Up to 3 years (Correct answer)
- Up to 5 years
- Permanent unless appealed
Correct answer: Up to 3 years
FAR 9.406-4 limits debarment to a period generally not exceeding three years, though longer periods may apply in certain fraud cases.
Question 4: Which contract type places the MOST financial risk on the government?
- Firm-Fixed-Price (FFP)
- Fixed-Price Incentive (FPI)
- Cost-Plus-Fixed-Fee (CPFF)
- Cost-Plus-Award-Fee (CPAF) (Correct answer)
Correct answer: Cost-Plus-Award-Fee (CPAF)
Cost-Plus-Award-Fee contracts place the most risk on the government because the government pays all allowable costs plus an award fee that can vary based on subjective performance evaluations.
Question 5: An agency issues a Request for Proposals (RFP). Under FAR Part 15, which document formally communicates the government's needs and evaluation criteria?
- The Justification and Approval (J&A)
- The Source Selection Plan
- The Solicitation (Correct answer)
- The Market Research Report
Correct answer: The Solicitation
The solicitation (RFP) is the formal document that communicates requirements, terms, conditions, and evaluation criteria to prospective offerors.
Question 6: What does the term 'organizational conflict of interest' (OCI) refer to in federal contracting?
- A contractor bidding on a contract where an employee previously worked for the agency
- A situation where a contractor's ability to render impartial assistance is impaired by competing interests (Correct answer)
- When two contractors in a joint venture have different overhead rates
- A conflict between contracting officer and program manager over contract type selection
Correct answer: A situation where a contractor's ability to render impartial assistance is impaired by competing interests
OCI occurs when a contractor's objectivity or ability to render impartial advice is impaired because of other activities, relationships, or interests.
Question 7: Under the Service Contract Labor Standards (formerly Service Contract Act), contractors performing service contracts above $2,500 must pay workers at least what?
- The federal minimum wage only
- Prevailing wage rates and fringe benefits as determined by the Department of Labor (Correct answer)
- The wage rates specified in the contractor's proposal
- GS pay scale equivalents for all workers
Correct answer: Prevailing wage rates and fringe benefits as determined by the Department of Labor
The Service Contract Labor Standards require contractors to pay service employees prevailing wage rates and fringe benefits as determined by DOL wage determinations.
FAC Contracting Principles & Regulations 3
A contracting officer awards a contract without obtaining the required written justification for other-than-full-and-open competition.
What is the most likely consequence?