Who Needs a Compliant Purchasing System?
When does a federal contractor need to have a compliant purchasing system? There are two basic scenarios when it will be required by the federal government.
Scenario 1: Prime contractor wins a Government contract that contains DFARS Clause No. 252.244-7001, Contractor Purchasing System Administration (or equivalent from another agency). Prime contractor, even with no requirement to have an “approved” purchasing system (i.e., no pending audit), must maintain an “approvable” purchasing system as a requirement of their Government contract.
Scenario 2: Prime contractor’s sales to the Government are expected to exceed $25M in the next 12 months (per FAR 44.302, CPSR Requirements) and prime contractor is notified by its Contracting Officer that the Government auditor (DCMA or other) will be reviewing their purchasing system for compliance with Federal regulations (i.e., CPSR).
What Do You Need?
When either of the above scenarios applies to you, then you need to ensure that you have implemented and are maintaining a compliant federal purchasing system. There are six basic conditions you will need:
- Upper management support is a MUST.
- At least 2 high level personnel dedicated to the implementation of the system (although many more will be involved in the actual implementation).
- Compliant purchasing policy and procedures manual (CohnReznick has a template that has been successfully used in 3 small business DCMA CPSRs).
- Purchasing System training for Business Development, Program Managers, Finance and Accounting, Accounts Payable, Legal, Contracts/Procurement, and Technical Support.
- Purchasing files (electronic is best) that demonstrate compliance with your manual.
- Internal reviews of your purchasing system, with associated reports.
How Long Will It Take?
CohnReznick has CPSR experts that have successfully implemented and reviewed over 14 federally compliant purchasing systems in the last decade, including many purchasing systems for small businesses in more recent years. And we have been able to get a purchasing system up and running in less than 12 months. See below for details.
Implement a Federally-Compliant Purchasing System in Less than 12 Months
|1||CohnReznick reviews existing Contractor purchasing policy and/or procedures|
|2||CohnReznick works with Contractor to ensure compliant Purchasing Policy and Procedures Manual|
|3||CohnReznick provides training at Contractor site for all personnel impacted by Purchasing System|
|4||Contractor creates purchasing files in accordance with compliant Purchasing System|
|5||CohnReznick reviews newly-created purchasing files for compliance; provides initial Internal Review Report|