Required Actions at Closeout
| Contracts involving: | Timeframe for closing after completion
or receipt of goods: |
|---|
| Simplified acquisition procedures | Immediately after final payment |
| FFP, without simplified acquisition
procedures | 6 months |
| Settlement of indirect costs | 36 months |
| All other types | 20 months |
The closeout process ensures that all terms and conditions have been met. FAR 4.804-1
requires that contracts be closed according to the following guidelines:
- Files for contracts using simplified acquisition procedures should be
considered closed when the Contracting Officer receives evidence of receipt
of property and final payment has been made, unless otherwise specified by
agency regulations
- Files for FFP contracts, other than those using simplified
acquisition procedures, should be closed within 6 months after the date on
which the Contracting Officer receives evidence of physical completion
- Files for contracts requiring settlement of indirect cost rates should be closed
within 36 months of when the Contracting Officer receives evidence of physical
completion
- Files for all other contracts should be closed within 20 months of when the
Contracting Officer receives evidence of physical completion
The Contracting Officer can use Quick Closeout as indicated in FAR 42.708 if the
following conditions occur:
- A contract with indirect costs is physically complete
- The amount of unsettled indirect cost to be allocated to the contract is relatively
insignificant
- The Contracting Officer can reach agreement with all interested parties on a
reasonable estimate of allocable dollars
Indirect cost amounts are considered insignificant when:
- The total unsettled indirect cost to be allocated to any one contract does not
exceed $1,000,000
- Unless otherwise provided in agency procedures, the cumulative unsettled
indirect costs to be allocated to one or more contracts in a single fiscal year do
not exceed 15 percent of the estimated, total unsettled indirect costs allocable
to cost-type contracts for that fiscal year. The Contracting Officer may waive
the 15 percent restriction based upon a risk assessment that considers the
contractor’s accounting, estimating, and purchasing systems; other concerns of
the cognizant contract auditors; and any other pertinent information.
- Closeout cannot occur if a contract:
- Is in litigation or under appeal
vv Is being terminated and all termination actions have not been completed
