United States Government Publishing Office publisher pbl distributor dst United States Government Accountability Office author aut Government Organization text government publication eng GAOREPORTS Legislative Agency Publications gao legislative 2010-08-12 U.S. Government Printing Office 2001-11-20 monographic deposited born digital 2 p. GA 1.13:GAO-02-227R https://www.govinfo.gov/app/details/GAOREPORTS-GAO-02-227R P0b002ee180384d7e f:d02227r DGPO 2010-08-12 2011-03-24 GAOREPORTS-GAO-02-227R machine generated eng fdlp REPORT GAOREPORTS-GAO-02-227R GAO-02-227R Contract negotiations Profits Policy evaluation Correspondence A02490 In July 2000, the Department of Defense published a proposed revision of its guidelines for developing profit objectives used in contract negotiations. The existing profit policy guidelines consist of: (1) investment in facilities and equipment, (2) performance risk, and (3) contract type risk. For each profit factor, the contracting officer determines an appropriate value and applies it against a specified base to develop the profit objectives. The proposed revision to would make the following changes to the profit guidelines: (1) inclusion of a fourth element--cost efficiency, which would allow the contracting officer to reward cost reduction efforts; (2) elimination of profit on investment in buildings and a reduction in the amount of profit derived from equipment investment; (3) the amount of profit based on performance risk would be increased; and (4) general and administrative expenses would be included in the cost base used for computing profit for performance risk, contract type risk, and cost efficiency. The decrease in profit for investment in facilities would be offset by the increased profit derived from performance risk and the inclusion of general and administrative expenses. https://www.govinfo.gov/content/pkg/GAOREPORTS-GAO-02-227R/html/GAOREPORTS-GAO-02-227R.htm https://www.govinfo.gov/content/pkg/GAOREPORTS-GAO-02-227R/pdf/GAOREPORTS-GAO-02-227R.pdf GAO-02-227R https://www.govinfo.gov/app/details/GAOREPORTS-GAO-02-227R Correspondence GAO-02-227R; Comments on Proposed Changes to Profit Policy (DFARS Case 2000-D018); Contract negotiations Profits Policy evaluation