Difference between revisions of "General Dollar Magnitude (GDM)"

Revision as of 13:20, 29 July 2019

A General Dollar Magnitude (GDM) is the overall general dollar magnitude to cost accounting changes, or non-compliances with a Cost Accounting Standard (CAS). A GDM Proposal is required to be submitted with an accounting change or non-compliance. A GDM contains an estimate of the aggregate impact on CAS covered contracts by contract type and by various departments/agencies.

General dollar magnitude proposal^[1].

The GDM proposal-

(1) Provides information to the CFAO on the estimated overall impact of a change in cost accounting practice on affected CAS-covered contracts and subcontracts that were awarded based on the previous cost accounting practice;

(2) Assists the CFAO in determining whether individual contract price or cost adjustments are required; and

(3) The contractor may submit a detailed cost-impact (DCI) proposal in lieu of a GDM proposal provided the DCI proposal is in accordance with paragraph (g) of this section.

General dollar magnitude proposal content^[2].

The GDM proposal-

(1) Shall calculate the cost impact in accordance with paragraph (h) of this section;

(2) May use one or more of the following methods to determine the increase or decrease in cost accumulations:

• (i) A representative sample of affected CAS-covered contracts and subcontracts.

• (ii) The change in indirect rates multiplied by the total estimated base computed for each of the following groups:

• • (A) Fixed-price contracts and subcontracts.

• • (B) Flexibly-priced contracts and subcontracts.

• (iii) Any other method that provides a reasonable approximation of the total increase or decrease in cost accumulations for all affected fixed-price and flexibly-priced contracts and subcontracts.

(3) May be in any format acceptable to the CFAO but, as a minimum, shall include the following data:

• (i) A general dollar magnitude estimate of the total increase or decrease in cost accumulations by Executive agency, including any impact the change may have on contract and subcontract incentives, fees, and profits, for each of the following groups:

• • (A) Fixed-price contracts and subcontracts.

• • (B) Flexibly-priced contracts and subcontracts.

• (ii) For unilateral changes, the increased or decreased costs to the Government for each of the following groups:

• • (A) Fixed-price contracts and subcontracts.

• • (B) Flexibly-priced contracts and subcontracts; and

(4) When requested by the CFAO, shall identify all affected CAS-covered contracts and subcontracts.

General dollar magnitude proposal evaluation.^[3]

The CFAO shall promptly evaluate the GDM proposal. If the cost impact is immaterial, the CFAO shall notify the contractor in writing and conclude the cost-impact process with no contract adjustments. Otherwise, the CFAO shall-

(1) Negotiate and resolve the cost impact (see 30.606). If necessary, the CFAO may request that the contractor submit a revised GDM proposal by a specified date with specific additional data needed to resolve the cost impact (e.g., an expanded sample of affected CAS-covered contracts and subcontracts or a revised method of computing the increase or decrease in cost accumulations); or

(2) Request that the contractor submit a DCI proposal by a specified date if the CFAO determines that the GDM proposal is not sufficient to resolve the cost impact.

References and Notes

1. ↑ 30.604(d) Processing changes to disclosed or established cost accounting practices.
2. ↑ FAR 30.604(e)
3. ↑ FAR 30.604(e)