Appendix 1: Glossary

Appendix / 1

Glossary

Following are the abbreviations and acronyms that you will be using when doing business with the federal government. Although not an exhaustive listing, it does contain the most commonly used abbreviations and acronyms that occur in conversations with government buying offices and in documents related to the contracting process.

A

Acceptance: The act of an authorized representative of the government by which the government, for itself or as agent of another, assumes ownership of existing identified supplies tendered, or approves specific services rendered as partial or complete performance of the contract.

Accounts payable: Amounts owed by you to others based on invoices or other evidence of receipt of goods or services, i.e., the amount due for goods or services that have been received but for which payment has not been made.

Accounts receivable: Amounts owed by others to you for goods furnished or services rendered. Reimbursements earned and refund receivables are included.

Accrual benefit cost method: An actuarial cost method where revenues and expenses are identified with specific periods of time and are recorded as incurred without regard to the date of receipt or payment of cash.

Accumulating costs: The collecting of cost data in an organized manner, such as through a system of accounts.

ACH: Automated Clearing House

ACMS: Advanced Cost Management Systems

ACO: Administrative Contracting Officer

Acquisition: The acquiring by contract with appropriated funds of supplies or services (including construction) by and for the use of the federal government through purchase or lease, whether the supplies or services are already in existence or must be created, developed, demonstrated, and evaluated. Acquisition begins at the point when agency needs are established.

Acquisition planning: The process by which the efforts of all personnel responsible for an acquisition are coordinated and integrated through a comprehensive plan for fulfilling the agency need in a timely manner and at a reasonable cost.

ACRS: Accelerated Cost Recovery System

Action program: A contractor's program that complies with Department of Labor regulations to assure equal opportunity in employment to minorities and women.

Actual cash value: The cost of replacing damaged property with other property of like kind and quality in the physical condition of the property immediately before the damage.

Actual costs: An amount sustained in fact on the basis of cost incurred, as distinguished from forecasted or estimated costs.

Adequate price competition: When two or more responsible offerors, competing independently, submit priced offers that satisfy the government's expressed requirements.

Administrative change: A unilateral contract change, in writing, that does not affect the substantive rights of the parties.

Administrative contracting officer (ACO): A contracting officer having responsibility for the administration of one or more particular contracts.

Advance agreement: An agreement negotiated in advance of the incurrence of a particular cost by a contractor specifying how that cost will be treated for purposes of determining its allowability (and thus its allocability) to government contracts. An advance agreement may be negotiated before or during a contract (but before the incurrence of the subject cost), and must be in writing. For a given contractor, advance agreements may be specific to a particular contract, a group of contracts, or all the contracts of a contracting office, an agency, or several agencies.

Advance payment: An advance of money made by the government to a contractor prior to, in anticipation of, and for the purpose of performance under a contract or contracts.

Advisory and assistance services: Those services provided under contract by nongovernmental sources to support or improve organizational policy development, decision-making, management and administration, program and/or project management and administration, or R&D activities.

ADR: Alternative Dispute Resolution

A&E or A/E: Architect-Engineer

AF: Air Force

AFAA: Air Force Audit Agency

Affiliates: Business concerns, organizations, or individuals are affiliates of each other if, directly or indirectly, (a) either one has the power to control the other, or (b) a third party controls or has the power to control both.

AFLC: Air Force Logistics Command

Agent: One employed to transact business for another. To the extent that the agent acts within the authority given, these acts are binding on the principal.

AICPA: American Institute of Certified Public Accountants

AID: Agency for International Development

Allocable cost: A cost that is assignable or chargeable to one or more cost objectives in accordance with the relative benefits received or other equitable relationships defined or agreed to between contractual parties.

Allocate: To assign an item of cost, or a group of items of cost, to one or more cost objectives. This term includes both direct assignment of cost and the reassignment of a share from an indirect cost pool.

Allowable cost: A cost that meets the tests of reasonableness and allocability, is in consonance with standards promulgated by the Cost Accounting Standards Board (if applicable), or otherwise conforms to generally accepted accounting principles, specific limitations or exclusions set forth in FAR 31.201-2, or agreed-to terms between contractual parties.

Alternative dispute resolution (ADR): Any type of procedure or combination of procedures voluntarily used to resolve issues in controversy quickly, creatively, and at less cost than established procedures.

AMC: Army Materiel Command

Amendment: A change to a solicitation before contract award.

AMIS: Agency Management Information System (DCAA)

AMP: Annual Management Plan

Announcement of opportunity (AO): A NASA broad agency announcement that does not specify the investigations to be proposed but solicits investigative ideas that contribute to broad objectives.

Annual funding: The current congressional practice of limiting authorizations and appropriations to one fiscal year at a time.

Anti-Deficiency Act: In accordance with the Act, no officer or employee of the government may create or authorize an obligation in excess of the funds available, or in advance of appropriations, unless otherwise authorized by law.

AO: Announcement of Opportunity

Applied research: The effort that (a) normally follows basic research, but may not be serviceable from the related basic research; (b) attempts to determine and exploit the potential of scientific discoveries or improvements in technology, materials, processes, methods, devices, or techniques; and (c) attempts to advance the state of the art.

Apportionment: Distribution by Office of Management and Budget of amounts available for obligation and outlay in an appropriation or fund account. The amounts may be available only for specified time periods, activities, functions, projects, objects, purposes, or combinations thereof. The specified amounts limit obligations to be incurred.

Appropriation: Statutory authority that allows federal agencies to incur obligations and to make payments out of the Treasury for specified purposes. An appropriation usually follows enactment of authorizing legislation.

AR: Army

Architect-engineer services: Professional services of an architectural or engineering nature, as defined by state law, if applicable, that are required to be performed or approved by a person licensed, registered, or certified to provide such services.

ASBCA: Armed Services Board of Contract Appeals

ASPR: Armed Services Procurement Regulation (changed to the DAR, which in turn was replaced by the FAR)

Assignment of claims: The transfer or making over by the contractor to a bank, trust company, or other financing institution, as security for a loan to the contractor, of its right to be paid by the government for contract performance.

Audit: The systematic examination of records and documents and the securing of other evidence by confirmation, physical inspection, or otherwise, for one or more of the following purposes: determining the propriety or legality of proposed or consummated transactions; ascertaining whether all transactions have been recorded and are reflected accurately in accounts; determining the existence of recorded assets and inclusiveness of recorded liabilities; determining the accuracy of financial or statistical statements or reports and the fairness of the facts they present; determining the degree of compliance with established policies and procedures relative to financial transactions and business management; and appraising an accounting system and making recommendations concerning it.

Automated Clearing House (ACH) Network: A national payment system that uses electronic means to transfer payment data and funds from an originator to a recipient's account at a receiving financial institution.

Award: Occurs when the CO has signed and distributed a contract to the contractor.

B

BAA: Broad Agency Announcement

Basic ordering agreement (BOA): A written instrument of understanding, negotiated between an agency, contracting activity, or contracting office and a contractor, that contains (1) terms and clauses applying to future contracts (orders) between the parties during its term; (2) a description, as specific as practicable, of supplies or services to be provided; and (3) methods for pricing, issuing, and delivering future orders under the BOA. A BOA is not a contract.

Basic research: Research directed toward increasing knowledge in science. The primary aim is a fuller knowledge or understanding of the subject under study rather than any practical application.

BCA: Board(s) of Contract Appeals

BDC: Business Development Center

BDE: Business Development Expense

Benefit-cost analysis: A systematic quantitative method of assessing the desirability of government projects or policies when it is important to take a long view of future effects and a broad view of possible side-effects.

Best value: The expected outcome of an acquisition that, in the government's estimation, provides the greatest overall benefit in response to the requirement.

Bid: A prospective contractor's (bidder's) reply to a formally advertised IFB. Needs only government acceptance to constitute a binding contract.

Bid and proposal (B&P) cost: The cost incurred in preparing, submitting, or supporting any bid or proposal, which effort is neither sponsored by a grant nor required in the performance of a contract.

Bid guarantee: A form of security assuring that the bidder (a) will not withdraw a bid within the period specified for acceptance and (b) will execute a written contract and furnish required bonds including any necessary coinsurance or reinsurance agreements, within the time specified in the bid, unless a longer time is allowed, after receipt of the specified forms.

Bid sample: A sample to be furnished by a bidder to show the characteristics of the product offered in a bid.

Bilateral contract: A contract between two parties and formed by a "promise for a promise," (offer and acceptance).

Billing rate: An indirect cost rate (a) established temporarily for interim reimbursement of incurred indirect costs and (b) adjusted as necessary pending establishment of final indirect cost rates.

Blanket purchase agreement (BPA): A simplified method of filling anticipated repetitive needs for supplies or services by establishing "charge accounts" with qualified sources of supply.

BML: Bidder’s Mailing List

BOA: Basic Ordering Agreement

Boiler plate: The standard clauses, sections, and other repetitive language inserted in contracts and other legal documents..

Bond: A written instrument executed by a bidder or contractor and a second party to assure fulfillment of the principal's obligations to a third party.

Book value: Original capitalized value of an asset, adjusted for accumulated depreciation and modifications where appropriate.

BOPCR: Breakout Procurement Center Representative (SBA)

BOS: Business Opportunity Specialist

B&P: Bid and Proposal

BPA: Blanket Purchase Agreement

Breach of contract: A failure to perform any contractual duty of immediate performance. May include failure to perform acts promised, prevention or hindrance, or repudiation.

Breakeven point: The sales volume at which total revenue equals total costs. Profit is zero.

Broad agency announcement (BAA): A general announcement of an agency's research interest, including criteria for selecting proposals and soliciting the participation of all offerors capable of satisfying the government's needs.

Bulk funding: A system whereby a CO receives authorization from a fiscal and accounting officer to obligate funds on purchase documents against a specified lump sum of funds reserved for the purpose for a specified period of time rather than obtaining individual obligational authority on each purchase document.

Bundling: Consolidating two or more requirements for supplies or services, previously provided or performed under separate smaller contracts, into a solicitation for a single contract that is likely to be unsuitable for award to a small business concern.

Burn rate: The monthly rate at which a contractor's funds are expended during a contract.

Business Opportunity Specialist: An SBA employee working with an 8(a) company.

Business unit: Any part of an organization, or an entire business organization, that is divided into segments.

Buying-in: Submitting an offer below anticipated costs, expecting to (a) increase the contract amount after award; or (b) receive follow-on contracts at an artificially high price to recover losses incurred on the buy-in contract.

C

CA: Commercial Activities

CAA: Civilian Agency Acquisition

CAC: Contract Audit Coordinator (Defense Contract Audit Agency )

CACO: Corporate/Home Office Administrative Contracting Officer

CACS: Contract Audit Closing Statement(s) (DCAA)

CAD/CAM: Computer-Aided Design Manufacturing

CAGE Code (Commercial and Government Entity): A contractor identification code that is assigned and maintained by the Defense Logistics Service Center to identify commercial and government activities. They were known in the past as Federal Supply Codes for manufacturers and nonmanufacturers.

CAIG: Cost Analysis Improvement Group (DoD)

CAM: Contract Audit Manual (Defense Contract Audit Agency)

Cancellation: The cancellation, within a contractually specified time, of the total requirements of all remaining program years of a multi-year contract.

CAO: Contract Administration Office (or Officer).

Capital asset: Tangible property, including durable goods, equipment, buildings, installations, and land.

Capital stock: The shares in a corporation representing a percentage of ownership in the business.

Cardinal change: A change outside the scope of the contract. It occurs when the government effects an alteration in the work so drastic that it effectively requires the contractor to perform duties materially different from those originally bargained for.

CAS: Cost Accounting Standard(s)

CAS Board: Cost Accounting Standards Board

Cash basis of accounting: The accounting basis in which revenue and expenses are recorded in the period they are actually received or expended in cash. It generally is not considered to be in conformity with generally accepted accounting principles and is therefore used only in selected situations, such as for very small businesses and, when permitted, for income tax reporting.