DFARS Contractor Purchasing System: What You Need to Know
If you are a government contractor, you need to have a compliant purchasing system to meet the requirements of the Defense Federal Acquisition Regulation Supplement (DFARS). The DFARS clause 252.244-7001 says that a contractor must have an approved purchasing system before being awarded a contract that exceeds the simplified acquisition threshold (currently $250,000).
The DFARS contractor purchasing system is designed to ensure that the government receives fair and reasonable prices for goods and services. It sets forth guidelines and requirements for contractors to follow when procuring materials and services, including competitive pricing, adequate cost analysis, and proper record-keeping.
To have a compliant purchasing system, a contractor must establish and maintain policies and procedures that comply with the DFARS clause. The policies and procedures must address the following areas:
1. Purchasing methodology: The contractor must establish a methodology for procuring goods and services that meets the requirements of the DFARS. This includes competitive pricing, cost analysis, and vendor selection criteria.
2. Purchase orders: The contractor must use purchase orders to document the procurement of goods and services. The purchase orders must include all necessary details, such as the quantity, price, and delivery date.
3. Receiving and inspection: The contractor must have a process for receiving and inspecting goods and services. This process should include procedures for verifying that the goods and services meet the specifications and requirements of the contract.
4. Subcontracting: The contractor must have a process for selecting and managing subcontractors. This process must include procedures for ensuring that the subcontractors comply with the DFARS and other applicable regulations.
5. Record-keeping: The contractor must maintain records of all procurement activities, including purchase orders, receiving and inspection reports, and subcontractor agreements.
The DFARS contractor purchasing system also requires contractors to undergo periodic audits to ensure compliance with the regulations. The audit may be conducted by the government or an independent auditor.
In conclusion, if you are a government contractor, it is essential to have a compliant purchasing system that meets the requirements of the DFARS. By establishing and maintaining policies and procedures that comply with the DFARS clause 252.244-7001, you can ensure that you are meeting the government`s standards for procurement. This will help you to win contracts and maintain a good reputation as a reliable and responsible contractor.