Threshold and approval for D&F 'Contract Type - Incentive Contracts'

Threshold and approval for D&F 'Contract Type - Incentive Contracts'

• A. >$10M SCO
• B. >$0 CoCO
• C. FAR 16.401(d), UAI 5116.401(d)
• D. <$0 CoCO

Answer: (B)

The test item is about the formal justification required to use an incentive contract. For a Determination and Findings (D&F) tied to the Contract Type - Incentive Contracts, the rule is that any incentive contract, regardless of size, requires a D&F and it must be approved by the CoCO. This means even a small incentive arrangement needs that higher-level, formal authorization to ensure the contract type is appropriate and properly justified, with clear performance incentives and risk handling outlined. CoCO refers to the official who has the authority to certify and approve contracting actions under this framework, providing the necessary oversight. The other options imply thresholds or authorities that don’t align with how incentive contract D&Fs are governed—whether by an unrealistically high dollar threshold, a nonsensical negative threshold, or by citations that don’t specify the required approval role.

The test item is about the formal justification required to use an incentive contract. For a Determination and Findings (D&F) tied to the Contract Type - Incentive Contracts, the rule is that any incentive contract, regardless of size, requires a D&F and it must be approved by the CoCO. This means even a small incentive arrangement needs that higher-level, formal authorization to ensure the contract type is appropriate and properly justified, with clear performance incentives and risk handling outlined.

CoCO refers to the official who has the authority to certify and approve contracting actions under this framework, providing the necessary oversight. The other options imply thresholds or authorities that don’t align with how incentive contract D&Fs are governed—whether by an unrealistically high dollar threshold, a nonsensical negative threshold, or by citations that don’t specify the required approval role.