Overview
This section defines the purpose of a Contractor Purchasing System Review (CPSR) as a formal evaluation of a contractor's subcontracting management and fiscal responsibility. It establishes the CPSR as the primary mechanism used by the Administrative Contracting Officer (ACO) to determine whether a contractor's purchasing system warrants official approval.
Key Rules
- The review must evaluate the efficiency and effectiveness of the contractor's expenditure of Government funds.
- The contractor’s compliance with Government policies regarding subcontracting is a central focus of the evaluation.
- The CPSR provides the mandatory evidentiary basis for the ACO to grant, withhold, or withdraw purchasing system approval.
Practical Implications
- An approved purchasing system significantly reduces administrative burden by allowing the contractor to award many subcontracts without seeking individual prior consent from the Government.
- Failure to maintain an effective system can lead to the withdrawal of approval, resulting in increased Government oversight, delayed procurement timelines, and potential financial impacts.