ACO CORB Questions With Correct Solutions
What are the responsibilities of an ACO? Correct Answer - The
ACO should ensure that the best interests of the Government are
protected by ensuring the terms and conditions of the contracts are
appropriate. all parties execute the contract according to the terms
and condition
Examples of responsibilities of an ACO? Correct Answer -
Conduct post award conferences, negotiate forward pricing rate
agreements, determine allowability of costs, establish final indirect
costs and billing rates, process novation and name change
agreements, and perform administrative closeout procedures.
What is the difference between an ACO and CA? Correct Answer -
The ACO has a warrant that binds the Government. The ACO's
decisions and documents are binding. The CA prepares documents
up to signature but cannot bind the Government.
What is the relationship between the prime and subcontractor?
Correct Answer - Privity - If the Government has a contract with
the prime contractor; there is privity of contract between the
Government and the prime. If the prime has a contract with its
subcontractors, privity of contract exists between the prime and its
subcontractor. No privity of contract exists between the
Government and the sub (unless there is another contract with
them). If no privity, you cannot negotiate directly with the sub or
direct the sub to take any action.
Generally speaking how long are funds available before they cancel?
Correct Answer - 5 years
Who can authorize the use of Advanced Payments? Correct
Answer - PCO
,What is the difference between finance payments and invoice
payments? Correct Answer - Finance payments are payments
made to a contractor prior to acceptance of product/service, while
invoice payments are made based on acceptance of product/service.
Examples of financing payments Correct Answer - Progress
Payments based on cost or completion of work, Performance Based
Payments, Advanced Payments or Interim Payment/Voucher for
cost type contracts.
What is the least preferred method of financing. Correct Answer -
Advanced Payments
What would be reasons for an ACO to suspend or reduce progress
payments? FAR 32.503-6, Clause 52.232-29 Correct Answer -
1. Non-compliance with material requirement of contract (ex.
Approved Accounting system)
2. Unsatisfactory financial condition
3. Inventory in excess of contract requirements (unreasonable)
4. Failure to make adequate progress
5. Delinquent in paying subs
6. Operating in a loss condition
What are Performance Based Payments? Correct Answer -
Payments based on achievement of specific, measurable events or
accomplishments that are defined and valued in contract. These
events should be identified as cumulative or stand alone events,
clearly describe the events and how they will be validated, and the
value for each accepted event. • Not used for smaller contracts
Not used for contracts less than 6 months
What does it mean when it's said progress payments are self-
liquidating? Correct Answer - The Government recoups
,contract funds through the deduction of payment of invoices at the
time of completed contract line items. When invoicing for
supplies/services, the debt is paid by taking a percentage of the
invoice. When the contractor submits a progress payments on the
DD1443 form the contractor will not bill for the amount of there
liquidating rate. The total billed amount will be added and totaled in
WIP. Upon delivery of the product, the contractor submits an invoice
for the total amount of the contract or line item and DFAS will empty
the WIP amount recouping those funds and paying and the amount
billed minus the WIP amount for the total amount owed.
What is needed before approving Progress Payments and PBP
Payments? Correct Answer - The ACO shall ensure the
contractor has an adequate accounting system and contracts that
ensure the government is otherwise protected against loss by
additional protective provisions. Additional provisions may include
risk assessment, cost benefit analysis, first article dollar limitation,
surveillance plan. Ensure the Master Payment Schedule in MOCAS is
completed
What are the different types of financing payments and on what type
of contract may they be used? Correct Answer - 1. Advance
Payments - May be used on any type of contract but must be
authorized by PCO and is used sparingly
2. Performance Based Payments - used on fixed price contracts only
3. Progress Payments - May be used on Fixed Price line items;
Payments are made on the basis of either a percentage of
completion of work (FAR32.101,102) or the incurrence of costs
4. Loan Guarantee - Made by Federal Reserve banks, on behalf of
designated guaranteeing agencies, to enable contracts to obtain
financing from private sources
5. Interim Payment on Cost Type Contracts
, What are the ACO's responsibilities for Progress Payments?
Correct Answer - 1. Determine if the use of progress payments
are pratical
2. Ensure contractor meets FAR 32.104(d) requirements
a. Small business (90%)
i. can't bill for first delivery prior to 4 months
ii. exceeds SAT ($150,000)
iii. Demonstrates an actual financial need
b. Not a small business (80%)
i. Can't bill for first delivery prior to 6 months
ii. Contract price exceeds $2.5M
iii. Demonstrates an actual financial need
3. Ensure MOCAS Prog Pay Master is updated to reflect rates, distro,
etc
4. Ensure progress payment requests (PPRs) are processed
promptly
5. Validate and approve/disapprove all PPRs
6. Ensure Progress payments are limited to interim financing of non-
commercial FFP Contracts, orders or line items
PBP Steps Correct Answer - 1. Identify PBP events (contractor
proposed)
2. Establish completion criteria
3. Obtain/evaluate contractors expenditure profile
4. Establish event values
5. Determine the type of event: severable or cumulative
6. Incorporate PBP Arrangements into table/special provision
Criteria that should not be used for PBP's: Correct Answer - •
Signing of a contract or contract modification
• Exercise of contract options
• The passage of time
• Attendance at meetings, conferences, seminars
• The expenditures of funds
What are the responsibilities of an ACO? Correct Answer - The
ACO should ensure that the best interests of the Government are
protected by ensuring the terms and conditions of the contracts are
appropriate. all parties execute the contract according to the terms
and condition
Examples of responsibilities of an ACO? Correct Answer -
Conduct post award conferences, negotiate forward pricing rate
agreements, determine allowability of costs, establish final indirect
costs and billing rates, process novation and name change
agreements, and perform administrative closeout procedures.
What is the difference between an ACO and CA? Correct Answer -
The ACO has a warrant that binds the Government. The ACO's
decisions and documents are binding. The CA prepares documents
up to signature but cannot bind the Government.
What is the relationship between the prime and subcontractor?
Correct Answer - Privity - If the Government has a contract with
the prime contractor; there is privity of contract between the
Government and the prime. If the prime has a contract with its
subcontractors, privity of contract exists between the prime and its
subcontractor. No privity of contract exists between the
Government and the sub (unless there is another contract with
them). If no privity, you cannot negotiate directly with the sub or
direct the sub to take any action.
Generally speaking how long are funds available before they cancel?
Correct Answer - 5 years
Who can authorize the use of Advanced Payments? Correct
Answer - PCO
,What is the difference between finance payments and invoice
payments? Correct Answer - Finance payments are payments
made to a contractor prior to acceptance of product/service, while
invoice payments are made based on acceptance of product/service.
Examples of financing payments Correct Answer - Progress
Payments based on cost or completion of work, Performance Based
Payments, Advanced Payments or Interim Payment/Voucher for
cost type contracts.
What is the least preferred method of financing. Correct Answer -
Advanced Payments
What would be reasons for an ACO to suspend or reduce progress
payments? FAR 32.503-6, Clause 52.232-29 Correct Answer -
1. Non-compliance with material requirement of contract (ex.
Approved Accounting system)
2. Unsatisfactory financial condition
3. Inventory in excess of contract requirements (unreasonable)
4. Failure to make adequate progress
5. Delinquent in paying subs
6. Operating in a loss condition
What are Performance Based Payments? Correct Answer -
Payments based on achievement of specific, measurable events or
accomplishments that are defined and valued in contract. These
events should be identified as cumulative or stand alone events,
clearly describe the events and how they will be validated, and the
value for each accepted event. • Not used for smaller contracts
Not used for contracts less than 6 months
What does it mean when it's said progress payments are self-
liquidating? Correct Answer - The Government recoups
,contract funds through the deduction of payment of invoices at the
time of completed contract line items. When invoicing for
supplies/services, the debt is paid by taking a percentage of the
invoice. When the contractor submits a progress payments on the
DD1443 form the contractor will not bill for the amount of there
liquidating rate. The total billed amount will be added and totaled in
WIP. Upon delivery of the product, the contractor submits an invoice
for the total amount of the contract or line item and DFAS will empty
the WIP amount recouping those funds and paying and the amount
billed minus the WIP amount for the total amount owed.
What is needed before approving Progress Payments and PBP
Payments? Correct Answer - The ACO shall ensure the
contractor has an adequate accounting system and contracts that
ensure the government is otherwise protected against loss by
additional protective provisions. Additional provisions may include
risk assessment, cost benefit analysis, first article dollar limitation,
surveillance plan. Ensure the Master Payment Schedule in MOCAS is
completed
What are the different types of financing payments and on what type
of contract may they be used? Correct Answer - 1. Advance
Payments - May be used on any type of contract but must be
authorized by PCO and is used sparingly
2. Performance Based Payments - used on fixed price contracts only
3. Progress Payments - May be used on Fixed Price line items;
Payments are made on the basis of either a percentage of
completion of work (FAR32.101,102) or the incurrence of costs
4. Loan Guarantee - Made by Federal Reserve banks, on behalf of
designated guaranteeing agencies, to enable contracts to obtain
financing from private sources
5. Interim Payment on Cost Type Contracts
, What are the ACO's responsibilities for Progress Payments?
Correct Answer - 1. Determine if the use of progress payments
are pratical
2. Ensure contractor meets FAR 32.104(d) requirements
a. Small business (90%)
i. can't bill for first delivery prior to 4 months
ii. exceeds SAT ($150,000)
iii. Demonstrates an actual financial need
b. Not a small business (80%)
i. Can't bill for first delivery prior to 6 months
ii. Contract price exceeds $2.5M
iii. Demonstrates an actual financial need
3. Ensure MOCAS Prog Pay Master is updated to reflect rates, distro,
etc
4. Ensure progress payment requests (PPRs) are processed
promptly
5. Validate and approve/disapprove all PPRs
6. Ensure Progress payments are limited to interim financing of non-
commercial FFP Contracts, orders or line items
PBP Steps Correct Answer - 1. Identify PBP events (contractor
proposed)
2. Establish completion criteria
3. Obtain/evaluate contractors expenditure profile
4. Establish event values
5. Determine the type of event: severable or cumulative
6. Incorporate PBP Arrangements into table/special provision
Criteria that should not be used for PBP's: Correct Answer - •
Signing of a contract or contract modification
• Exercise of contract options
• The passage of time
• Attendance at meetings, conferences, seminars
• The expenditures of funds
