Contract Pricing

With the war coming down to an end the current contract with Acme Generator Company will need to come to an end. However, before a contract can be terminated a Contracting Officer will have to ensure the Government is in the right when it does take this approach. In order for this to be practiced it is very important for the Contracting Officer to ensure the appropriate clauses are incorporated with the contract set in place. For this scenario we will say this contract with Acme Generator Company was a fixed price service contract which falls under the simplified acquisition threshold (SAT). The reason this is important is because there are different clauses which should be incorporated among different types of contracts.

To begin the Contracting Officer will have to look at the FAR Matrix in FAR part 53 see under the specified matrix which clauses are needed for certain types of contracts (2010). Going over to the section under FP SVC (Fixed Price Service Contract) the Contracting Officer will notice all the clauses which are required within the contract and under this portion the Contracting Officer will notice to incorporate clause 52.249-1(FAR, 2010). FAR clause 52.249-1 which is Termination for Convenience of the Government(Fixed-Price) (Short Form) would be needed within the situation for a fixed-price service contract because it deals with contracts which are under the SAT (FAR Part 49.5, 2010). After knowing the contract clause is within the contract it is now the Contracting Officer can go ahead and start to exercise the termination for the convenience of the Government.

The first part of doing this is for the Contracting Officer to issue Acme Generator Company a notice letting them know the Government is going to terminate for convenience in part because completion of the contract would not be practical or economical for the Government due to the war winding down and their being now need for the services any longer (Engelbeck, 2007). Once the...