Times Are Changing: Contractor Purchasing System Review Expectations and Realities for 2017

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2 Times Are Changing: Contractor Purchasing System Review Breakout Session #: E06 Presented by: E Jean Labadini Michael Carter Date: 7/25/17 Time: 2:30 3:45 1

3 Take Aways The most recent changes to the CPSR requirements, Government players and the overall process Lessons learned from recent successful CPSR experiences How you can mitigate risk in your next CPSR 2

4 Historical Overview of the CPSR Environment Current CPSR Environment and Expectations What s really Changed How to Prepare 3

5 Historical Perspective Resourcing Compliance Approach Policy Regulatory Requirements Political Emphasis Consistency Transparency Public Posting 4

6 Recent Process Changes Contract Requirements Contract Clauses Consent Package Review CPSR Team Insight into Practices DCAA Participation DCMA ACO Participation Counterfeit Electronic Parts Initially only CAS-covered; Oct 2016 the rest 5

7 Recent Process Changes (Cont d) CPSR Analysts Activity Post Review Level II CARs DCMA Cost and Pricing Center Commercial Item Group (CIG) Composition Typically former DCAA or DCMA Cost/Price Analysts, former Industry Organized in 6 Geographical Regions/Teams St. Pete, FL (South Team) Boston & Philadelphia (Northeast Teams) Indianapolis (Midwest Team) Denver & Phoenix (West Teams) 6

8 Questions Historical or Process Changes? Next Topics address Practices 7

9 Changes in Review Criteria? Reduced individual topics addressed in a CPSR report. 40+ to 29 Examples of criteria no longer addressed individually in recent CPSR reports. Split Awards Lead Time Letter Subcontracts Accuracy of the Universe Competition Sole Source Justifications Equal Employment Opportunity 8

10 Changes in Review Criteria? (Cont d) Does this mean we don t need to prepare for the previously analyzed/reported criteria? Some criteria were eliminated and others combined: Lead Time Competition Sole Source Justifications Letter Subcontracts Procurement Requisitions Source Selection Selection of Subcontract Type 9

11 Changes in Review Criteria? (Cont d) Most Common Material Deficiencies Identified during Recent CPSRs Debarment Anti-Lobbying Price Analysis DPAS FFATA Commercial Item Determination Policies and Procedures Documentation Sole Source Selection Justifications Truthful Cost or Pricing Data (formerly TINA) 10

12 Changes in Review Criteria? (Cont d) Have expectations for compliance to these requirements changed? 11

13 Preparation How should I approach my CPSR Readiness Activities? Ongoing System Monitoring and Improvement Assess and revise/develop, as necessary, purchasing system policies and procedures for compliance with: CPSR Guidebook & CPSR P&P Checklist DFARS (c) and Public Law, FAR and DFARS reqs. Ensure files are standalone, organized and available before the team arrives 12

14 Preparation (Cont d) Lessons Learned from Poor CPSR Preparation, Management and Execution 13

15 Preparation (Cont d) What Proactive Steps can you Take when the CPSR Team Leaves your Facility? Begin assessing the areas identified as concerns Identify and implement corrective action Update, develop, and enhance purchasing system policies and procedures to include forms and templates, as needed Conduct training on topics of concern Develop draft responses to DCMA Proceed with improved compliance 14

16 Compliance Tips What do the most effective approved purchasing systems have in common? Compliant Policies and Procedures (and Follow Them!) Purchasing Forms and Checklists (File Documentation) Training and Internal Review/Self Audit Programs High percentages of competition Documented Negotiations Price Analysis 15

17 Contact Information Capital Edge Consulting Jean Labadini (mobile) Mike Carter (855) x131 (office) (480) (mobile) Chase Kunk 855-CAP-EDGE ( ) x123 (office) (mobile) 16

18 Questions? 17