Research Paper on Contract Cost and Documentation for Navy

Introduction

Contract cost included the strategies for controlling different types of expenses associated with agreements and documentation of contracts. With the utilization of different contract cost strategies, they aid in the provision of different kinds of products to the Navy; thus, the involved company needs to justify their billing processes along with other costs related to the service as offered by Vanessa Sequeira Inc. (VS Inc.). On the other hand, contract documentation plays a significant role in helping the company check the working progress with the inclusion of the paper filings with the target of ascertaining the accuracy of billings. In most of the cases, the documentation process is adopted to help minimize the effects as well as maintain the quality of the products and services (Meredith & Mantel Jr, 2011). It is essential to consider various issues, especially when dealing with the Federal Government. These issues include consideration of the overall prices along with the terms of the contract (such as payment options, quality control, inspection schedules, closeout option, among others). In this particular case involving floor equipment, the other competitor has removed their name for consideration and deliver a request to Vanessa Sequeira Inc. to become VSI's sub-contractor as a result of the company's patent on the specialty coating.

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However, this paper will attempt to determine the type of payment (receiving progress payment, performance payments, partial payments) applicable in VS Inc. bid, identify the approach and terms requiring consideration in requesting the use of the Navy's floor equipment and propose the various inspection and quality control procedures that should be in the bid proposal. Also, the paper will determine the patent infringement issues and the contract closeout mechanisms for my company.

Payment Type in the Bid

In the preparation of the bid for a contract for Navy, it is essential to consider various types of payments that the company wishes to receive. For instance, some of the payment options include; advance payments, progress payments, and partial payments. In the bid, the most preferred payment type is the receiving progress payment. Progress payments enable the contractor to receive payments before a regular bill being issued for the item delivery (which may happen late in the contract duration). Under the FAR 32.102b, as costs are incurred, the progress payments are delivers depending on the approved progress payment rate percentage (Adams, 2014). The fees do not accumulate or take into account the amount of completed work but are provided on the basis and progress of the action as the name suggest. However, the Government owns the right to reduce or suspend payment in case the contractor fails to meet contractual demands and requirements as agreed.

Moreover, since the progress payments seek to cater for costs within the contract, it will help in the bid by ensuring that all the creditors are paid duly with the aim to reduce incurred liabilities. In as much as the payment of suppliers is involved, the progressive payment method will ensure a proper relationship between the supplier and my company since there are minimal chances of fall out in payment failures. Also, the progress payment seeks to provide that there are no or minimal cases of fraud or other instances of mismanagement of funds since acquired payment will be channeled to ensuring that the contract is covered within the set budget and within the given timeframe. On the other hand, this type of payment will provide that Navy does not feel burdened with the payments since the progress payments could deliver the ability of Navy to gather multiple channels for payments such as the use of credit among other modes.

Approach and Key Terms to Consider in Requesting the Navy's Floor Equipment

Due to the condition of VSI's floor equipment's, which is outdated, getting an alternative solution is essential. It means that the company can either replace the machine for a new one; however, there is an option of requesting the use of Navy's floor equipment. Since this is not part of the bid or the contract, making a formal request that will be included in the agreement for hire or acquisition is an approach I would take. In this occurrence, it seeks approaching the contracting officer and making a formal request to source their floor equipment since acquiring a new machine would be costly. The contract concerning the application to use Navy's floor equipment revolves around doing an agreement deed seeking to use the floor equipment on lease terms.

Additionally, in this lease for using the Navy's floor equipment, I would request the creating of separate contract where I would acquire the floor equipment at fair market value (FMV); however, Navy would deduct the monthly payments from the payments. At the end of the lease, I would request the Navy to give me the option to purchase the equipment, return the machine, or renew the lease contract. Also, some of the critical terms requiring consideration in the lease agreement include; lease duration, the market value of the floor equipment, tax responsibility, and other cancellation provisions.

Essential Quality Control and Inspection Procedures in The Proposal

Quality control is a process through which entities review the quality of all factors involved in the delivery or service and products. One of the recommended quality control procedures in the statistical quality control method. Within this procedure, it evaluates the quality of services and products by use of the analytical approach. The statistical quality control method is applicable in monitoring and controlling of a process. With the inclusion of this quality control method, it seeks to ensure that data delivered tallies the actual data in terms of the project and service delivery. Also, statistical quality control revolves around the evaluation of samples about the time intervals for inspection to maximize process quality (Meredith & Mantel Jr, 2011). Moreover, a certificate of conformance is something I would prefer. Through conformance certification, it seeks to deliver every required detail according to the client (Navy) with the inclusion of quality assurance coverage to ensure the Navy is assured of the quality of the process as well as the overall service.

In consideration of the inspection procedures, it involves a process through which various variables may be checked for compliance against a selection of set rules. The audit procedures are an inspection procedure that I believe should be included in the proposal. Audit procedures are useful since they seek to derive the extent to which individuals adhere to rules. In audit procedures, as a method of inspection, it provides mechanisms for auditing process outputs and measuring the results for potential developments and improvements. Also, the proceedings will assist in bringing the quality control systems together especially in providing valuable feedback on the functionality of the system. Through the inclusion of these quality control and inspection procedures in the proposal, they will ensure that the Navy feels confident in assigning the bid to my company. Proper quality control and inspection systems help reduce operational costs and other production costs that may occur as a result of mismanagement and poor-quality delivery in terms of services and products.

Patent Infringement Objections for the Use of The Coating

In the determination of whether the Navy would or not have a patent infringement objection towards the use of the coating, it is essential to understand some of the critical factors. The company has its patent on the specialty of the layer which means that it has the property rights as the inventor of the involved design. It is a design patent, and the company entails a limited monopoly since it has the exclusive rights to utilize the coating as well as sell. However, the company will benefit from the innovation for a limited duration while the patent becomes obsolete and the owner cannot sue upon the expiry of the period. As a result, the Navy has a patent infringement objection as they lack the rights to use the specialty floor coating to develop their aspirations. Within the constraints of the innovation, it is protected meaning that the company has the mandate to sue the Navy in case the Navy utilizes the specialty coating as their own. Upon the expiry of the period, Navy will not be under any legal restriction meaning that they cannot be held for infringement of the patent. Moreover, the license is accustomed to an expiry date to allow more investments in resources in the creation of more innovations. Hence, the Navy would not have a patent infringement objection to use the specialty coating on expiry of the assigned period.

Mechanisms for Contract Closeout

A contract closeout occurs upon the completion of the contact among other contractual requirements. In the contract closeout, the company will assume various tools to ensure proper operation of activities with the Navy. First, the Navy is responsible for providing that the final work is satisfactory and completed as expected. Next, the contract closeout will ensure that the company receives all the payments according to the requirements of the contract. According to the FAR 4.804-5, a deal is ready for closeout once all the terms of the agreement and administrative actions have been completed, all disputes settle and final payments delivered (Adams, 2014). Some of the involved executive activities encompass property, royalties, patents, and securities. In this case, the company needs to adopt every one of these mechanisms to ensure no misunderstanding develop, as per the requirement of the contract, the company should all the administrative closure actions are taken with the established procedures such as reporting and disposal of surplus commodities.

Conclusion

In conclusion, according to Powell-Smith, Sims, and Dancaster (2008), proper documentation is essential during the contract closeout since it plays a significant role in ensuring that all the legal requirement according to the federal laws on the contractual agreement are adhered to. In most cases, issues concerning payment deliver challenges during contract closeout. Thus, in this case, the company needs to ensure the proper delivery of receivables and payables making sure that the company's finances tally with Navy's financial documentation. The involvements of this mechanism are meant to ensure that every party in the contract is satisfied. Also, since no other transactions can be conducted after contract closeout, it is critical to countercheck everything and makes amendments where a need arises.

References

Adams, Clark G. (2014). Federal Acquisition and Contract Management (8th ed). Covina, CA: AGU Press.

Meredith, J. R., & Mantel Jr, S. J. (2011). Project management: a managerial approach. John Wiley & Sons

Powell-Smith, V., Sims, J. H., & Dancaster, C. (2008). Contract documentation for contractors. John Wiley & Sons.