Whitepaper: The Audit World's Biggest Myths
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From DCMA “640” Program Reviews and other Small Business Subcontracting plan development to Small Business Liaison Officer (SBLO) mentoring, our Small Business Compliance subject matter experts can help solve your small business challenges and improve your company’s overall small business program compliance and competitiveness.
The United States federal government is the largest buyer of goods and services in the world. Since the creation of the Small Business Administration (SBA) in 1953, the federal government has placed an emphasis on small business utilization within the federal acquisition marketplace. This is particularly important because 99% of U.S. firms are small businesses and contribute to nearly 50% of private sector employment. To encourage small business participation, “Other-Than-Small-Businesses” (AKA Large Businesses) are required by law and the FAR to include small businesses within all the socio-economic sub-categories to the maximum extent practicable in their procurement processes. Most large businesses establish small business participation programs within their companies to encourage small business use companywide. As part of our service capabilities, Capital Edge places importance on helping develop programs to achieve the next level of compliance.
In December 2023, the DCMA publicly revealed that 85% of the contractors that were reviewed during GFY2023 by DCMA in a “640” Small Business Program Compliance Review resulted in one of the two lowest ratings – Marginal and Unsatisfactory. This is meaningful because these ratings may be, and often are used as discriminators by the government during competitive source selections. Capital Edge’s experienced subject matter experts can help improve DCMA “640” Review ratings, thereby improving competitive differentiation as a leader in small business program development leading to more contracting opportunities and wins which, of course, lead to increased revenues!
Capital Edge’s combined experience will help you maximize the effectiveness of your corporate small business program, and ensure maximum small business participation across all of the required small business socio-economic categories. We tailor our support to meet your specific small business program goals, needs and requirements.
Contact Capital Edge to learn how we can help improve your small business program, including your DCMA small business program rating, and develop compliant small business subcontracting plans that can often be differentiators within the federal competitive acquisition environment. Our unique suite of services can upgrade your overall small business utilization, which can lead to increased revenues.
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Here are some of the more common questions being asked about CPSR
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…”
According to DCMA CPSR Reports issued in GFY2019, DCMA identified that the “most common material deficiencies” relate to:
A DCMA purchasing system disapproval can cause many issues for a contractor, including:
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.
Caution: The CPSR dollar amount established in the regulation is discretionary and may be lowered or raised. (FAR 44.303).
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.
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.”
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.”
Capital Edge government contract consultants support Government Contractors and Federal Grant Recipients. Our consultants specialize in the regulatory compliance matters you need.
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