THE
FEDERAL PRICE EVALUATION COURSE.
COURSE
SYLLABUS.
ACE
CREDIT RECOMMENDATION.
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THE
FEDERAL PRICE EVALUATION COURSE.
Generally.
The
American Council on Education college credit
recommended Price Evaluation Course develops and
improves skills of buying supplies, equipment,
construction, and services in a fashion that
recognizes purchasing persons as participants in a
profession that has its own discrete language,
procedures, and body of knowledge.
It is based upon the premise that following
documented, accepted and proven process of evaluating
pricing will consistently result in rationally
supported prices that support best value buying that
will withstand stringent review.
Additionally, proper and adequate price
evaluation, together with sufficient planning and
execution of pricing discussions will likely result in
substantial purchase savings.
This
forty-hour block of training is computer based and
very interactive. The student covers twelve topics, is
engaged in over 250 interactions, and is given more
than 500 choices using Multiple Choice questions, and
matching, fill-in-the-blank, and move and place
exercises.
Student performance is tracked on the pc and
the cumulative scoring and Certificate are printed
from the pc.
Targeted
Positions.
The
Price Evaluation Course is especially suited for
persons whose primary responsibility is to price and evaluate
the reasonableness of pricing.
The Public Sector Model is particularly suited
for the GS 1102 Series Contracting Officer and
Contract Specialist who have completed qualifying Federal
Acquisition Institute's (FAI) Contract Specialist
Training Blueprint for Units 28, 36, and 37 and those
who are preparing for such training.
As and ACE college credit recommended course, it is
approved by the Defense Acquisition University for two
of the 21 credit hour needed for Level-1 Contracting
Office Certification. For those who have successfully completed the
Contract Specialist Training, it serves as refresher, annual maintenance,
and career enrichment training.
For those who are preparing to take the FAI
Blueprint training, it is a comprehensive orientation
of both price analysis and cost analysis that will
orient and prepare the student to do well in the
Blueprint training for price analysis and cost
analysis. Others
who interface with the supplier or contractor
regarding pricing issues that would benefit
significantly from the training include purchasing
agents, contracting officer representatives (CORs),
those who buy with credit cards, and those otherwise
seeking to learn the established pricing and price
evaluation process.
Course
Development.
The
Public Sector Model – FAR Version.
Centered upon the Federal Acquisition
Regulation, the Public Sector Model is designed to
conform to the Federal Acquisition Institute’s (FAI)
Contract Specialist Training Blueprint for Unit 28
Price Analysis (Sealed Bidding) 36 Price Analysis
(Negotiated Acquisitions) plus a good look at the
process and procedures of Cost Analysis, Unit 37.
The training demonstrates and tests the
students understanding of the impact of competition,
market conditions, contract type, and the type of
specification or purchase description on price
evaluation and the importance of source selection
criteria and offeror qualifications, including past
performance, on determinations of best value.
Given
acquisition planning, and offers to evaluate using
price and price related factors (e.g. Buy American
Act, transportation costs, administrative costs of
multiple awards, f.o.b. delivery terms, assumed
economic price adjustments, options, small
disadvantaged business price evaluation adjustments,
and HubZone price evaluation preferences), the student
is required to accurately evaluate prices.
The student is taught the types and importance
of price adjustment techniques, including the use of
estimated quantities, assumed change, price indices,
and ratio analysis.
In performing a price evaluation, the student
identifies all comparative data, selects the best
price evaluation comparison and analysis techniques
for the procurement, and accurately adjusts the data
for equitable comparison of offers, and correctly
determines the lowest evaluated offer and offers that
are reasonably priced.
The student performs many of the tasks outlined
in the FAI Contract Specialist Training Blueprint to
the standards outlined.
Regarding
Unit 37, Cost Analysis, the student is taught the
language of cost analysis by being provided a
description of costs concepts as they are used in
actual application.
Given an audit report providing questionable
costs, the student is guided through the establishment
of a price negotiation objective by quantifying and
disallowing questionable costs.
This analysis includes looking into overhead
and general and administrative (G&A ) pools for an
assessment of the reasonableness of costs and the
establishment of overhead and G&A rates. The
student is directed through the listing and
explanation of the factors that should be considered
in establishing a reasonable profit.
Finally the student is taught the process and
need for documenting the planning and execution of
price discussions and the final pricing agreement.
The
Private Sector Model.
The Price Evaluation Course – Private Sector
Model is the classroom version of the United States
Postal Service’s Price Evaluation Course put on CD
and made interactive by FAM&TS.
The Postal Service is an independent,
non-appropriated entity within the Executive Branch of
the Federal Government that is not subject to the
Federal Acquisition Management Regulation and
developed its Purchasing Manual based upon best
practices in the commercial market place.
There are no requirements for full and open
competition, no set asides for small, women-owned, or
disadvantaged businesses, and there are less stringent
requirements for publication of requirements and
purchases, fewer restraints on noncompetitive
purchasing that the Public Sector FAR Model;
The
U.S. Postal Service Supply Management organization is
comprised of more than six hundred persons who are
responsible for cumulative purchases in excess of $9
billion annually. This approved course was taught by
FAM&TS repetitively each year to hundreds of
Postal Service purchasing professionals across the
United States from its inception in 1992. The
classroom version was updated twice by FAM&TS and
includes exercises from the last Federal Acquisition
Institute’s version of its Price Evaluation Course.
The training discusses and tests the students
understanding of the impact of competition, market
conditions, contract type, and the type of
specification or purchase description on price
evaluation and the importance of the source selection
criteria and offeror qualifications, including past
performance on determinations of best value.
Given
acquisition planning, and offers to evaluate using
price and price related factors, the student is
required to accurately evaluate prices.
The student is taught the types and importance
of price adjustment techniques, including the use of
estimated quantities, assumed change, price indices,
and ratio analysis.
In performing a price evaluation, the student
identifies all comparative data, selects the best
price evaluation comparison and analysis techniques
for the procurement, and accurately adjusts the data
for equitable comparison of offers, and correctly
determines the lowest evaluated offer and offers that
are reasonable.
Regarding
Cost Analysis, the student is taught the language of
cost analysis by being provided a description of costs
concepts as they are used in actual application.
Given an audit report providing questionable
costs, the student is guided through the establishment
of a price negotiation objective by quantifying and
disallowing questionable costs.
This analysis includes looking into overhead
and general and administrative (G&A) pools for an
assessment of the reasonableness of costs and the
establishment of overhead and G&A rates. The
student is directed through the factors that should be
considered in establishing a reasonable profit.
Finally the student is taught the process and
need for documenting the planning and execution of
price discussions and the final pricing agreement.
Federal
Price Evaluation Course Suite.
The
Federal Price Evaluation Course is a suite that
contains five components, two of which are available
without charge for evaluation purposes prior to the
purchase of the course, should be utilized prior to
opening the course.
For best results, taking the Federal Price
Evaluation Course should include the following
recommended elements:
Step
– 1 View the Audio-Video Presentation.
The Audio-Video Presentation
- for a broad and general overview of the
course.
Step
– 2 Examine the Course Demo.
The Course Demo - to become comfortable with
the navigation tools and to get a more comprehensive
view of the content of the course.
Step
– 3 Take the Price Evaluation Course.
Finally, open the Federal Price Evaluation
Course, but avoid the “Section Quizzes” until you
are familiar with the above components of the suite.
Use the accompanying Instructor Guidance and
the Student WorkBook for the Practical Exercises.
1.
Instructor
Guidance.
The Instructor Notes provide a preview of each
section quiz and walks the student, step—by-step,
through the practical exercises.
2.
Student
WorkBook.
The Student WorkBook is provided for Sections
5, 6, 9, and 11 and provides the student the
opportunity to work these more comprehensive exercises
outside of the application so responses can be fully
considered before being placed in the application for
scoring and performance tracking.
Course
Coverage.
Generally,
Federal Price Evaluation Course focuses on:
1) the fundamentals of price evaluation,
including the language of price evaluation; 2) the
significance of market activity on pricing; and 3) the
application of price evaluation techniques through the
many self-paced practical exercises.
During the Price Evaluation Course, the student
will learn price evaluation and gain price evaluation
experience while gaining the following proficiencies:
Sources
of Pricing Data.
Examine
data sources for value and utility in price
evaluation; including historical data, offeror data,
market data, and government data; then evaluate the
comparability of such data by considering the likely
impact of the passage of time, inflation, special
terms and conditions, quantity or magnitude
differences, and extent of competition.
Price
Evaluation.
Evaluate offers both where the basis of source
selection is the lowest price from qualified and
capable offerors, and where the basis of source
selection is ‘best value,’ where technical
evaluation criteria carry more weight during the
evaluation process.
Unbalanced
Pricing.
Apply the concept “Unbalanced Pricing” in the
evaluation of indefinite quantity requirements in
determining whether the lowest evaluated price will
likely result in the lowest overall costs of delivery.
Use
of Indices. Adjust
prices by constructing indices and using existing
Department of Commerce indices to determine market
trends.
Price
Escalation.
Evaluate offered prices by adjusting an agreed upon
base with an agreed upon pricing escalation factor for
a specific period of time in arriving at the proper
evaluated price.
Contract
Types.
Adjust
risks to performance by use of proper type of contract
which include fixed price contracts, cost
reimbursement contracts, indefinite delivery
contracts, and special contracts of labor hour, time
and materials and letter contracts.
Cost
& Pricing Data.
Identify the circumstances where price evaluation must
include a review of offeror cost and pricing data, and
estimating systems.
Cost
Analysis.
Examine
the elements of price, including direct labor and
direct materials, the indirect costs of overhead and
G&A; the types of accounting systems that are the
source of cost and pricing data; and factors
considered in determining a reasonable profit.
Audit
Report.
Using
an audit report, evaluate price by disallowing cost
that are unsupported; including those that result in
overhead and G&A rates.
Best
Value Analysis.
Evaluate offers by applying objective quantifiable
best value criteria and subjective best value criteria
where specified quality features or capabilities are
identified in the solicitation.
Price
Discussions.
Review
the preliminary steps to pricing discussions,
including; planning, presenting plan to superiors,
conducting discussions; and documenting the results of
discussions and final pricing.
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COURSE
SYLLABUS
Federal
Price Evaluation Course Sections
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Est.
Hours
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Review
Audio-Visual Presentation
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.5
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Familiarization
with Course Demo
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1.0
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Cumulative
Reading of Instructor Guidance
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1.0
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Section
1 Introduction
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1.0
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Section
2 A Fair and Reasonable Price
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2.0
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Section
3 Purchasing Planning
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2.0
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Section
4 Price Evaluation and Contract Types
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2.0
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Section
5 Competition and Price Evaluation
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2.0
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Section
6 Price Adjustment Techniques
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6.0
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Section
7 Obtaining Data for Price Evaluation
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3.0
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Section
8 Comparability of Pricing Data
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2.0
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Section
9 Case Study – Price Analysis
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6.0
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Section
10 Cost Analysis Procedures
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4.0
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Section
11 Case Study – Competitive Cost Analysis
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6.0
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Section
12 Price Discussion and Documentation
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2.0
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Total
Course Time
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40.5
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Computer
Based Training.
Once
the Federal
Price Evaluation Course (CBT) is installed
on the student’s personal computer and licensed, the
student, self-paced, will be guided through twelve
topics that teach price evaluation proficiencies.
The
CBT is delivered completely from the student’s
personal computer (pc).
The 40-Hour CBT does not rely on scrolling
screens of text, but uses linking of information in a
fashion that makes for uncluttered screens and the
availability of information when relevant and the
student has the greatest incentive to use and learn
it.
The
CBT
is licensed for one-year from date of purchase but the
student must complete the training within three months
of the start of the training.
However, for best results, one-week should be
set-aside for the purpose to taking the 40-hour CBT.
Just as if in a classroom and being monitored,
the student should be located where there are no
interruptions or significant distractions.
The course requires careful reading, note
taking, and requires thinking through challenges,
often using calculations.
Performing the training in a place where the
student is likely to experience the ordinary
distractions of the regularly assigned job is highly
discouraged. However,
the student can be successful in making an acceptable
score by using blocks of time over an extended period
of time, which must not to exceed three months from
start of session.
The
CBT is very interactive, and provides the student
hundreds of graphic rich screens, more than 250
interactions and provides more than 500 choices.
It segments training into manageable modules of
one to two-hour periods before quizzing.
The quizzing includes multiple choice
questions, fill in the blank calculation, and
move-and-place. There
are three major exercises that provide hands on
experience with a real life price evaluation and price
analysis; the use of price adjustment techniques, and
use of cost analysis.
Using an Excel Workbook, the student performs
the calculations of the exercises before inputting the
result into the application for performance tracking.
The CBT records, tracks, and accumulates
scoring for ready access.
Upon
completion of the CBT, the student can evaluate and
email the course evaluation results and performance
scoring to the Course Administrator and print the
Certification of Completion and scoring results; all
from within the application.
ACE
CREDIT RECOMMENDATION.
The
American Council on Education reviewed the course on
29 June 2004, and provides the following (Please See
ATTACHMENT-A ACE COLLEGE CREDIT RECOMMENDATION:
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Courses:
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Federal
Price Evaluation Course, Public Sector Model
(0001)
ACE
Transcript Data: FAMT-0001
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Federal
Price Evaluation Course, Private Sector Model
(0002)
ACE
Transcript Data: FAMT-0002
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Location:
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Web/Computer
Based
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Length:
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40
hours (to be completed within 3 months)
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Credit
Recommendation:
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In
the lower division baccalaureate/associate
degree category or the upper division
baccalaureate degree category, 2 semester
hours in Public Administration, Procurement,
or Purchasing (6/04). Note: Students may not
receive credit for both Federal Price
Evaluation: Public Sector Model and Federal
Price Evaluation: Private Sector Model.
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