How to respond to Corrective Action Requests from DCMA
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To Government Contractors, Corrective Action Request (CAR) is a dreadful word. It carries not only contractual but also financial consequences, with payment withholding for up to 5%.
We have just recently published a white paper, explaining what a CAR is, implications for different levels of CARs, some real company CAR examples, and how a contractor can respond to CARs.
Government Property Management system is one of the 6 required business systems for government contractors. A shortcoming in the system will have contractual and financial implications for government contractor.
DFARS 252.242-7005 (FEB 2012)
(d) Significant deficiencies
“…a shortcoming in the system that materially affects the ability of
officials of the Department of Defense to rely upon information
produced by the system that is needed for management purposes.”
(e) …the CO will withhold 5% of amounts due from progress payments
and performance-based payments (for the current contract), and
direct the contractor to withhold 5% from its billings on interim cost
vouchers on CR, labor-hour, and T&M (for ALL contracts) until the
CO has determined that the contractor has corrected all significant