Contractor Purchasing System Review

Providing the greater GovCon community with “real-world” procurement leadership and CPSR compliance expertise in the ongoing pursuit of maintaining government approved purchasing systems.

The Contractor Purchasing System Review (CPSR) provides contracting officers a basis for granting or withholding approval of a contractor’s purchasing system. Expertise in this highly specialized and regulated audit preparation practice is difficult to find.

Our ability to provide customer satisfaction in the ever-changing regulatory environment and unstable CPSR-centric landscape can largely be attributed to one single factor: our people. Capital Edge is unique in the market in that our solution includes former Defense Contract Management Agency (DCMA) CPSR Group personnel, DCMA administrative contracting officers, Government procuring contracting officers and procurement experts who were previously responsible for CPSR compliance while working for major industry players serving DoD, the Intelligence Community and civilian agencies.

Capital Edge employs more CPSR compliance experts than any other firm in the market. A subset of our team previously developed the CPSR criteria directly with DCMA and assisted in the creation of critical tools for DCMA use both during purchasing system reviews and in their FAR Part 44-required system surveillance. Our CPSR SMEs stand out from the CPSR consultant competition because our people have actually negotiated and administered subcontracts/POs for major U.S. Government contractors, in the CPSR environment, prior to their tenure at Capital Edge.

This blend of fully dedicated CPSR experts and their collective experiences ensure the critical perspectives, including the Government reviewer, system approval authority and the Federal procurement practitioner, all of which are directly leveraged for the benefit of our clients.

Our expertise, combined with our CPSR leadership previously serving as “real-world” procurement leaders responsible for ensuring CPSR compliance and maintaining a government approved purchasing system, establishes Capital Edge as the market leader in CPSR readiness and ongoing system compliance for Federal contractors.

In other words, our people are our lifeblood, and our knowledge only begins with DCMA CPSR Guidebook guidance and is honed through the creation and maintenance of a set of proprietary tools developed from our recurring experiences and lessons learned through the DCMA CPSR process. We bring that ground-level experience and solutions to achieve the greatest success for our clients.

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Differentiate your business as a reliable vendor and line up support for your next CPSR by contacting us today

Fill out the form below or call (855-227-3343)

Our CPSR Solutions Include:

Pre-CPSR

Federal Purchasing System Gap Analyses
“Mock CPSR”
Remedial Action Plan Development and Implementation
Federal Procurement Policies and Procedures
Federal Procurement Forms and Checklists
Federal Procurement / CPSR Compliance Training
Federal Procurement / CPSR Compliance Training for Non-Procurement Personnel
Internal Review Tools and Outsourced Support
Comprehensive Procurement File Remediation
Procurement File Remediation Advisory Support
DCMA CPSR Risk Assessment Form Support
DCMA CPSR Policies and Procedures Checklist Support (commonly referred to by some as the “DCMA CPSR Audit Checklist” or “DCMA CPSR Checklist”)
Final CPSR Preparation and Rehearsals Support
On-Demand Advisory Support Services
DCMA CPSR Risk Assessment Advisory Support
DCMA CPSR Questionnaire Response Advisory Support

Live CPSR

On-site Liaison Support with the DCMA CPSR Team
Rhetorical Advocacy Position Development
“Audit” Management of the CPSR
Strategic and Tactical Risk Management

Post-CPSR

CPSR Report Analysis and Response Development
Corrective Action Plan Development, Presentation and Implementation
Corrective Action Validation
Federal Purchasing System Compliance Monitoring
On-Demand Advisory Support Services

What is a CPSR

CPSR stands for Contractor Purchasing System Review and is commonly referred to by some as a “CPSR Audit” or “CPSR Review”. In layman’s terms, a CPSR is an adequacy evaluation of a contractor’s policies, procedures and practices against certain FAR and DFARS requirements.

CPSR Meaning
Per FAR Part 44, the CPSR means a complete evaluation of a contractor’s purchasing of materials and services, subcontracting and subcontract management from requirements through completion of subcontract performance.

The DCMA CPSR’s Group Mission

Although the CPSR is codified in FAR and is therefore not exclusively a DoD contractor concern, the Defense Contract Management Agency (DCMA) employs a team of dozens of CPSR procurement analysts to conduct the reviews of contractors’ purchasing systems. No other federal agency or department is comprised of such a large team of people solely dedicated to performing CPSRs. In fact, civilian agencies commonly engage the DCMA to perform reviews of contractors’ purchasing systems on their behalf.

The DCMA has defined the Contractor Purchasing System Review (CPSR) Group’s mission – “Ensure that [Government] suppliers have purchasing systems in place that contribute to effective subcontract management. Effective subcontract management includes the development of, as well as performance to internal policy and procedures, public law and adequacy of cost and price analyses performed on subcontractors.”

Consistent with this mission statement, the Federal Acquisition Regulation (FAR) CPSR objective in Subpart 44.3, Contractors’ Purchasing System Reviews, states that the “objective of a contractor purchasing system review (CPSR) is to evaluate the efficiency and effectiveness with which the contractor spends Government funds and complies with Government policy when subcontracting….”

Understanding DCMA’s CPSR meaning, mission, and objective, contractors must realistically evaluate their current purchasing system. As part of this evaluation, contractors should use the primary authoritative regulations and DCMA guidance around the CPSR, including, without limitation:

DFARS 252.244-7001, Contractor Purchasing System Administration
FAR Subpart 44.3, Contractors’ Purchasing System Reviews
The FAR and DFARS clauses tested for compliance in a CPSR (e.g. FAR 52.204-10, etc.)
DCMA CPSR Policies and Procedures Checklist (commonly referred to by some as the “DCMA CPSR Audit Checklist” or “DCMA CPSR Checklist”)
DCMA CPSR Guidebook

CPSR Frequently Asked Questions

Does a CPSR include purchasing and subcontracting?

Yes. Except for certain transactions excluded under FAR 44, your purchasing and subcontracting activities are within CPSR scope. DFARS 252.244-7001 defines the purchasing system to include “…the system or systems for purchasing and subcontracting…”

What are Common Federal Purchasing System Deficiencies?

According to DCMA CPSR Reports issued in GFY2019, DCMA identified that the “most common material deficiencies” relate to:

Debarment
Payments to Influence
Cost Analysis / Price Analysis
DPAS
FFATA
Sole Source Justification
Policy & Procedure Manual
Commercial Item Determinations (CID)
Truthful Cost in Pricing Data (formerly known as Truth-in-Negotiations Act or TINA)
Negotiations

Who performs the "CPSR Audit"?

A CPSR is not an “audit” but a “review.” Within the Department of Defense (DoD), the Defense Contract Management Agency (DCMA), specifically the DCMA CPSR Group, is typically responsible for reviewing the contractor’s purchasing systems. The DCMA CPSR Group is comprised of “analysts” not “auditors.” In some cases, DCMA also reviews the purchasing system of contractors that do not hold DoD contracts.

What are the Impacts of a Purchasing System Disapproval?

A DCMA purchasing system disapproval can cause many issues for a contractor, including:

Increased oversight of contractor’s business (e.g. audits and reviews of other business systems, etc.) and delay in the government acquisition process;
Increased application of government consent to subcontract requirements;
Potential withhold of payments;
Competitive disadvantage in responding to Government requirements; and
Disclosure via Contractor Business Analysis Repository.

What is the Current CPSR Requirement Threshold

A CPSR is performed on a discretionary basis if deemed necessary by the Administrative Contracting Officer (ACO). The ACO’s decision to determine the need can be, in part, influenced by the contractor’s anticipated FAR-44 qualifying sales volume and results of the contractor risk assessment.

FAR 44.302: Greater than $25M in the next 12 months.
DFARS 244.302: Greater than $50M in the next 12 months.

Caution: The CPSR dollar amount established in the regulation is discretionary and may be lowered or raised. (FAR 44.303).

Where can the CPSR requirements be found?

The specific subject matter areas evaluated in a DCMA CPSR can be found in the DCMA CPSR Guidebook under the “Major Purchasing Areas” subsection as well as in the associated appendices to the Guidebook.

What is the CPSR Guidebook?

The Contractor Purchasing System Review (CPSR) Guidebook is published by the DCMA. The purpose of the DCMA Guidebook is to provide “…guidance and procedures to Government personnel for evaluating contractor purchasing systems and preparing the CPSR reports.”

Click to see the 2021 Revised CPSR Guidebook

What is CPSR certification?

The phrase “CPSR certification” is a misnomer. Rather, a CPSR is a review conducted by the government that results in a report which provides the basis, at least in part, for the cognizant federal agency official to make a decision – e.g. that the system is acceptable and approved. FAR 44.305 is very clear as to who has purchasing system approval authority – “The cognizant ACO is responsible for granting, withholding, or withdrawing approval of a contractor’s purchasing system.”

What Does CPSR Stand for?

“CPSR” stands for Contractor Purchasing System Review.

Differentiate your Business as a reliable vendor and line up support for your next CPSR by contacting us today.

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Recent Thought Leadership Articles

What is a CPSR? What do I need to know about the DCMA CPSR? The Five Ws and How

Navigating the Tail-End of the DCMA CPSR Process - from Exit Briefing to DCMA’s Corrective Action Request to the DCMA CPSR Report

Preparing for DCMA’s Information Requests – In addition to the DCMA CPSR Policy and Procedure Checklist, What Information and Records does the DCMA CPSR Group Request from the Contractor before the CPSR?

12 Essentials to a Successful Contractor Purchasing System Review

CAS Training

TRAINING & EVENTS

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