IND 205 L-2 Contractor's PMS Procedures

Lesson 2
Contractor Property Management System Requirements

Defense Contractor Property
Management System Written
Procedures
These written procedures are based upon the requirements for managing
Government Property that are included in all Department of Defense
Contracts for this corporation.
Government Property Management
Purpose/ Target Audience

This procedure explains the requirements, and outlines the process to be followed, to properly
control government and customer owned property accountable to the Business Unit (BU)
contracts in compliance with all applicable control requirements.
This procedure, and other Government property (GP) procedures and work instructions, describe
many of the requirements for the control of GP along with specific instructions for the Property
Management Office (PMO) personnel. Departments such as Mission Assurance, Operations,
Engineering, Manufacturing, and Logistics may have specific instructions that complement the
GP procedures and work instructions for their personnel’s GP and customer property (CP) control.
The target audience for this procedure is all employees.
Requirements
GP and CP shall be governed by the controls established by this procedure. Whenever the
acronym GP is used throughout this procedure, it may be interchanged with CP. If there are any
inconsistencies between this procedure and the terms of the contract under which GP is provided,
the terms of the contract shall prevail.
GP Management System
In accordance with Corporate Property Management Plan the Business Unit (BU) shall establish
and maintain a compliant GP system for the control, use, maintenance, repair, protection, and
preservation of GP and CP in the possession of the BU and respond promptly to all system
deficiencies or customer concerns.
This system shall meet the applicable provisions of Federal Acquisition Regulation
(FAR) 52.245, Government Property as well as the use of voluntary consensus standards and/or
industry leading practices, customary commercial practices and other contractually imposed
requirements. The BU shall establish and maintain an organization, that has current procedures,
records, an effective self-assessment program, and metrics that provide state of the health data to
ensure effective management of GP and CP.
An effective Property Management system encompasses at minimum three resources:

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• People – an organization and infrastructure to ensure that property is adequately
managed;
• Record System – data-base(s) to support the receipt, recording and related
transactional requirements, and
• Written procedures – Property Management procedures are located in the
Business Unit library/ resources. All employees shall have the ability to readily
access. Also, other functional procedures and work instructions may inter-relate and
supplement the Government/ Customer Property procedures and work instructions. The
Property Management Office (PMO) shall update procedures and work instructions
on a periodic basis or as required when regulatory changes warrant.
The Government Property Administrator shall be notified when significant changes in the
property system are identified. The BU defines significant changes in the property management
system as; Change in campus PMO Managerial personnel, replacement of property record system
or changes to procedures other than clarifications, cosmetic or campus applicability.
All personnel who are stewards of GP shall ensure proper controls and protection of the
equipment in their possession or under their control. Their responsibilities are delineated in this
procedure along with other functional department procedures throughout the BU.
System Analysis
Government or customer representatives periodically perform system analysis t o determine the
BU’s compliance with applicable property control requirements. The BU shall satisfy all actions
resulting from this analysis, which may include system approval, request for corrective action, or
a recommendation for system disapproval. Disapproval could cause the BU to suffer financially
and/or jeopardize future business. Liability for GP is based on contract clauses and in most
circumstances the government assumes the liability for property.
Campus Assessment
If the BU property management practices are deemed inadequate, present an undue risk to the
government or management fails to take timely corrective action the liability for loss, damage, or
destruction of GP may be transferred to the BU. Each campus shall conduct functional property
area assessments in accordance with campus management objectives, customary leading industry
practices and applicable standards, ISO 9001:2000 and/or AS9100B. Corrective action plans
shall be developed to
preclude recurrence of any highlighted deficiencies, as required. Campus management shall share
assessments with customer representatives as applicable and promote an open environment in
order to minimize the expense of organizational resources by accomplishing redundant reviews or
audits.
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Inputs/ Outputs
The following table identifies the inputs to and outputs of this implemented procedure.
Inputs Outputs
• Applicable control • Properly managed GP/CP
requirements. • Satisfactory GP Management
• Maintenance of GP System
Management System • Satisfactory assessments, reviews, or
• Assessments audit results
• Customer reviews • Corrective Action Requests (CARs)
• Corrective Action Plans (CAPs)
Procedure
The following table identifies the sequence of steps/actions to be performed and the individual
or function responsible.
Property Management Office (PMO)
1. Develops and maintains procedures and work instructions and

enforces all requirements for the proper management of GP
accountable to the BU or its subcontractors.
2. Enforces all property requirements and facilitates
communication between other departments and upper management
in regard to property matters.
3. Reviews contracts as they are established in the order entry system to
determine if the clauses warrant PMO oversight.
4. Establishes property administration of a contract when:

• FAR clauses or similar language pertaining to GP
are invoked.
• The contract is cost type or time-and-materials and tasks
would include the acquisition of hardware or the
establishment of material inventory whereby acquired
material is titled to the customer.
• The PMO is notified that the local Government
Administrative Office has been delegated property
oversight.
• When U.S. GP is provided.
• When CP is provided other than by the U.S.
government.
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Program Managers and Users of Government and Customer Property
5. Maintains proper controls and protection for equipment/ material in their

possession or under their control, ensuring that GP and/or CP is only used
on the contract for which it has been provided or as contractually
authorized.
References
Policy Corporate Property Management Plan
Other FAR 52.245, Government Property (applicable clauses)
ISO 9001:2000
AS9100B
Outcome 1 – Government Property Acquisition

This procedure explains the requirements and outlines the process to be followed to acquire
government and/or customer property in the performance of the Business Unit (BU) contracts. GP
and Customer Property (CP) shall be acquired in accordance with this procedure.
Individuals involved in the acquisition of Government-Furnished Property (GFP) and Contractor

Acquired Property (CAP) vary by functional department for specific responsibilities. Department
procedures and instructions should be addressed throughout the acquisition process.
The target audience for this procedure is all employees.
Requirements
Contract proposals containing property requirements should be reviewed by affected
organizations, including the Property Management Office and Program Management, prior to
submission of the proposal response to the customer. Proper flow down of the contract terms and
conditions and GP/CP requirements shall
be communicated to Engineering, Purchasing, the Property Management Office (PMO)
and functional departments, as required. Employees who are responsible for Government
property (GP) or customer property (CP) must be acquainted with and comply with the provisions
of the applicable contracts.
Acquisition Process
GFP or Customer-Furnished Property (CFP) shall be authorized by a contract, modification, or
other official document. Many contracts are awarded with GFP being furnished to the BU at
contract award. The government may also transfer GFP from other government contracts when
the BU or the government identifies needed property belonging to different government contracts
or programs. Contracting Officer (CO) authorization is required either by a contract modification
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or correspondence stipulating transfer and/or usage conditions.
GFP can also be acquired through MILSTRIP, a method to order property/material from
government sources of supply. The PMO, Overhaul and Repair Organizations, Materials
Management, and specific programs use the MILSTRIP system to acquire GP that is needed to
satisfy contract requirements.
The method the BU chooses to obtain CAP is influenced by various factors such as
‘make or buy decisions’ and program schedules.
GP/ CP Program Execution

The BU shall document that all property acquisitions are consistent with its engineering,
production planning and material controls. Various functions such as the PMO, Engineering,
Programs, Materiel Control, Tool Design, and Purchasing have at their disposal systems and
procedures to initiate and effect the acquisition of property. The engineering community acquires
property and material as it pertains to Research and Development efforts, Design, Test, and state
of the art programs. Materials Management acquires property and material to support production
and post-production efforts.
Operations or Tool Design shall coordinate the acquisition and/or fabrication of special tooling
(ST). Purchasing affects the acquisition of materials and products from outside sources that are
required in the performance of the contract. Departmental procedures for acquiring property and
materials have been established to provide guidance to the BU’s personnel and ensure that
authorized procurements occur.
Inputs/ Outputs
The following table identifies the inputs to and outputs (including auditable records) of this
implemented procedure.
Inputs Outputs
• Proposal/Contract defined • Property listed in contract
need • Internal Work Orders/POs
• Make/Buy decisions • DD 1149 transfers
• CLINS/Bill of Materials • Material Management Accounting
• Excess Material/Attrition System (MMAS) transactions
• Existing Property • MILSTRIP requisitions
Procedure
The following steps/ actions identify the sequence to be performed and the individual or function
responsible.
1. Provides oversight of the acquisition process and guidance to Contracts,

Programs, Engineering and Operations as required.
2. Recommends process improvements as necessary, including reviewing for proper
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authorization to acquire property, reviewing proposals.
3. Assists Proposal and Program Management in the screening of existing
inventory, when tasked.
4. Coordinates with the Contracts Representative/Buyer/SCA (Subcontracts
Administrator) GP/CP provisions for use, contract transfers and documentation for
property located at our subcontractors, as required and ensures that authorized
property transfers are documented.
Repair Operations
5. Receives repair items (RMRs) or candidates for repair by various customers and
contract arrangements.
6. Uses Government-Furnished Material (GFM) or CAM to affect repair of failed
items, as appropriate.
PMO and Departments Requiring Government Furnished Property
7. Ensures that appropriate site MILSTRIP activity is in compliance with contract terms
(reference DoD Manual 4000.25-1-M, Military Standard Requisitioning and Issue
Procedure (MILSTRIP)).
Proposal/ Program Manager
8. Determines whether GP or CP is required and, in doing so, reviews existing

capabilities to ascertain whether the capability exists at the BU.
9. If the capability exists, pursues availability of existing asset(s), although the contract
or program constraints or schedule will dictate whether use of existing equipment or a
new acquisition is warranted.
Contracts Representative (CR)
10. Communicates the required property for contract performance to the Procurement
Contracting Officer (PCO), buyer, or respective customer.
11. Secures the required authorizations for the acquisition of all GP/CP, MILSTRIP,
special test equipment (STE), ST and/or Equipment that is delineated in the proposal,
contract or statement of work especially when these commodities are not delineated as
part of a contract line item.
12. Should Contractor Acquired Property be required, determines whether the
property is allowable in accordance with the contract terms and conditions.
13. Requests that a Signal and Fund code be supplied by the Contracting Officer, when
MILSTRIP is anticipated, as part of the service activity designator information.
Additionally a project code, distribution code, priority code, and/or a routing identifier
may be provided.
Operations, Manufacturing and Engineering

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14. Assists Proposal and Program Managers with identifying needed GP or CP as well as
providing inputs on make or buy decisions.
Procurement
15. Acquires required material, supplies and services through the supply chain as
authorized to satisfy contract requirements.
Process I Contractual Flowdown
1. Flow down of Contract Provisions

a. Contracts shall review the terms and conditions of contracts and when contractual
authority exists to acquire property Contracts shall notify Purchasing using a General
Order.
b. Functional Organizations shall acquire only those items of property that are
authorized by General Orders and other documents issued by Contracts. Costs related
to unauthorized acquisition are subject to disallowance by the customer.
Process II Government Furnished Property (GFP)
1. Contracts department obtains contractual coverage for Government Furnished Property

(GFP) required in support of each contract, either at the time the contract is negotiated or
during the performance of the contract.
A review of available in-house assets is to be accomplished before initiating the
acquisition of GFP. Cancellations/changes to requirements to acquire GFP from the
government, or to purchase/fabricate must be processed in a timely manner to prevent
unnecessary acquisition.
Government Furnished Property (GFP) is property in the possession of, or acquired
directly by, the government and subsequently delivered or otherwise made available to the
Company.
2. Establishing Contractual Authorization for GFP
a. Contracts shall negotiate with the customer and include in the proposed contract a
statement authorizing GFP; a listing of approved Federal Stock Class Codes of GFP
authorized to be obtained from government stock; a complete and accurate Master
Government Furnished Equipment List (MGFEL); or other authorizations as may be
appropriate. Communicate requirements to applicable material control analysts.
b. Materiel Control/Property Management shall:
1) Review new contracts for GFP requirements, prepare and submit a Military
Standard Requisitioning and Issue Procedure (MILSTRIP) electronic form(s)
or other approved acquisition methods through the business system to the
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customer in accordance with DOD Manual 4000.25-1-M and Appendix B of
the contract.
2) Initiate action to cancel or revise quantities on order when cancellations or quantity
changes are authorized.
Process III Contractor Acquired Property (CAP)
1. Contracts issue General Orders and related documents authorizing the purchase,
fabrication or other means to acquire material.
2. Material may be purchased from a supplier, fabricated, or issued from Company inventory
for direct charge to a contract.
3. A review or screening of existing inventory must take place prior to release of
documentation to purchase or fabricate. The results of the screening are to be analyzed in
accordance with applicable clauses contained in specific contracts. When an item is
located but is subsequently rejected for use, the rejection must be documented.
4. Acquisition orders must be initiated so that material and parts will be acquired or
fabricated by the desired time and in the appropriate quantities based on established stock
levels and review of usage rates.
5. Planning:
a. Program Operations, Research & Engineering, and Material shall determine the types
and quantities of material required based on a review and analysis of engineering
documents, lists and bills of material, logistics spares requirements and schedules,
make or buy contract provisions, manufacture or purchase decisions and contract
provisions.
6. Acquisition:
a. Requiring Activities shall:
1) Check existing Property before purchasing any Property.
2) If existing inventories are available for transfer:
a. Accomplish cost-type material transfers of CAP.
b. Cost transfers of stock, company-owned or usage material between
contracts does not require formal documentation.
c. Transfers of Government Furnished Material (GFM) shall be
accomplished via contract modification, and documented with DD Form
1149. This will require the approval of the losing and gaining
Government PCO’s.
d. If no existing inventories are available, prepare and forward purchase
documentation to Material Control for processing to the purchasing
organization.
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Process IV Acquisition of Special Test Equipment
1. Establishes the controls, responsibilities, and requirements for the acquisition of Special
Test Equipment (STE). It ensures that authority to acquire will be obtained and the proper
documents will be prepared for all acquisitions, i.e., requisitions, purchases, and
fabrications of government STE.
General-purpose components of special test equipment, regardless of cost, cannot be
acquired with contract funds unless the items are specifically identified in the contract or
are acquired for incorporation into contractually authorized special test equipment.
Only costs properly chargeable to a contract may be billed to or reimbursed by the
government. Finance & Contracts issues General Orders and related documents
authorizing the purchase, fabrication, or other means to acquire STE. Questions regarding
the contents of these authorizing documents are to be addressed to Contracts and Pricing.
2. Processing Requests
a. The Program Manager or Supervisor shall itemize specific STE requirements on a
Notice of Intent, and forward the documents through Property Management. The
Program Manager or Supervisor will ensure none of this STE is available and
indicate this on the request before submitting it to Property Management.
b. Property Management shall:
1) Coordinate requests with all potential users to determine total requirements for
each item of STE.
2) Review current STE lists and any available excess equipment lists for existing
STE or general-purpose components to satisfy requirements. If requirements
can be met, notify the Program Manager or Supervisor.
3) If current STE or general purpose components cannot meet requirements, a
Notice of Intent must be processed, including, but not limited to, the
nomenclature, task identification, justification analysis, estimated cost
breakdown, and listing of all components which have an estimated individual
acquisition value of $5,000 or more.
4) Verify the classification to determine whether the items or systems qualify as
STE in accordance with FAR 52.245-1 clause. Classification will be based
upon the integrated "test unit" or "composite test system" including all
components and parts and as to how the item or system is used.
3. Purchasing STE
a. Property Management shall:
1) Upon receipt of an affirmative response from the customer requesting approval
to acquire STE, enter a reference to the government approval..
2) Annotate those components to be furnished by the government.
3) Notify the Program Manager or Supervisor.
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4) Maintain all pertinent STE records in accordance with corporate policy.
b. The Program Manager or Supervisor:
1) Direct Research and Engineering Design Engineering to proceed with STE
design.
2) Request a "manufacture" or "purchase" decision from Materiel Control.
3) Complete procurement specification requirements if the decision is to purchase
the STE.
4) Prepare a Purchase Requisition and attach a copy of the authorizing documents.
The requisition must contain, regardless of cost and as a minimum, a reference
to the STE control number and the government letter, when applicable,
authorizing acquisition as STE, or a copy of the authorizing letter must be
attached.
5) Submit the requisition to Accounts Assignment who reviews and forwards the
requisition to Purchasing to acquisition the STE.
4. Fabricating STE
a. Program Manager or Supervisor shall:
1) Based on the General Order released by the Contracts department authorizing
the fabrication of STE, obtain an Engineering Order or equivalent document
from Engineering, which provides instructions for the fabrication of the
required STE.
2) When the STE is completed notify Property Management.
3) Notify Contracts to obtain customer approval
b. Property Management shall tag STE and establish property records.
Process V Transfer of Government Property from Other Government Contracts

Government Property can be acquired from other Government contracts by processing a
transfer. This is accomplished with mods to both the losing and gaining contracts, and
documented by completing a DD1149. The losing and gaining Prime(s) Procuring
Contracting Officer(s) (PCO) must approve the transfer. This request must be processed
through the respective Program Manager or Supervisor, Contracts, and coordinated with
Property Management and Material Control. If property is received without proper
authorization and complete information and further research is required, the benefiting
program may be charged the effort associated with acquiring this information.
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Outcome 2 – Government/ Customer Property Receipt (Identification)
This Process establishes the controls, responsibilities, and requirements for the receipt
of Government, Company, or commercial property from all sources. This includes
the receipt of government property from other locations and government depots and
the receipt of Contractor Acquired Property (CAP).
The target audience for this procedure is all employees who receive all classifications
of Government property.
Requirements
All GP/CP shall be received and identified in accordance with this procedure. The property must
be protected against loss, damage, destruction and unauthorized movement during the receiving
process. All property is inspected upon receipt for correct identity, count, condition, and
agreement with the incoming shipping document. The inspection results are documented on the
actual document received (i.e., DD1348, DD1149, DD250, etc.) and action is taken to resolve
discrepancies as so noted on the receiving document. All property is placed in a controlled area at
the receiving location. Records shall be established in accordance with Outcome 3, Government
Property Records and acceptance or rejection data is entered into the appropriate business system.
The property in the areas must be identified and marked (incorporation of the Identification
procedure eliminates the need for a separate functional procedure) as to Government, Company or
Commercial ownership after initial receiving and acceptance actions. The property is separated
by status groups, e.g., held for inspection, pending delivery, or damaged. Receiving,
Warehousing, and Quality Assurance are responsible for the receiving and inspection areas and
for ensuring that receiving documents reflect correct identity codes, an accurate count, the
receiving date, any acceptance or rejection information, and the Purchase Order (PO) number.
Procedure
The Receiving personnel receive property and perform a physical inspection as to condition and
identity against the transfer document or packing slip. The items received are matched against
the purchase document and/or system if appropriate to assure all items were shipped and the
terms were met. The shipping/transfer document or Purchase Order serves as the receiving report
and is dated and signed when the items physically arrive on the premises.
Receiving Process
1. Receipt of Property
a. Government property received will be delivered to the receiving area and provided
adequate protection during the receiving process. Government property furnished
directly from the government or property transferred from another contract is
received via a DD Form 1149, Requisition and Invoice/Shipping Document, a DD
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Form 1348-1, Single Line Release/Receipt Document, or a DD250, Material
Inspection and Receiving Report which constitutes the receiving document. The
serial or requisition numbers of these documents are posted to the property record or
where applicable.
b. All other government property is received via transfer documents or purchase
documents.
c. Receiving personnel will perform the following functions:
1) Perform physical verification of the items received to determine the accuracy
of the count, description including the nomenclature, tag number (when
applicable), part number, serial number, etc., ownership, contract number
(government property only), and condition. This data will be entered into the
appropriate business system. When the quantity or description of property
received differs from the quantity or description noted as shipped on the
shipping document, only that quantity or description actually received would
be recorded on the official property records. The receiving document form will
be signed and dated on the date that the item is received and filed in the
receiving files. For tag-controlled items the tag number will be annotated on
the document and Property Management will be notified.
2) Indicate on the Bill of Lading (BL) and/or freight bill all package shortages or
other irregularities and obtain the signature of the carrier's driver. See Section
2 to process discrepant or damaged property.
3) Notify Property Management, who will perform necessary tasks to in-
check/verify property and input to business system. This will include
properly tagging the property.
a. Property Management will review the DD1149 for accuracy.
4) This includes contract numbers, condition code, quantity, and cost. When
there is an error on the document, contact the losing facility for a corrected
document. The property will stay in a secure area until discrepancies are
resolved.
5) When necessary and after paperwork is reviewed and deemed correct, Property
Management will notify the Government Property Administrator, Quality
Assurance Representative and, applicable supervisor to verify receipts.
6) Property Management will tag and input to the business system all government
owned property before leaving the warehouse
7) Company owned purchases with a value greater than $5000.00 will be tagged
with a company property tag.
8) Company owned purchases with a value less than $5000.00 will be tagged with
company property expense tag (EX), input into the applicable system if
calibration is required, and notify those appropriate.
2. Discrepancies/Incident to Shipment
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a. When overages, shortages, or damages are discovered upon receipt of government
property, the appropriate Government representative will determine the disposition
or corrective action.
b. When property is received from a Government activity, and discrepancies (overages,
shortages, damage, incorrect item, incorrect conditions, incorrect supply documents,
improper packing, etc.) are detected, the Quality Assurance Representative or
receiving personnel will prepare and forward a Standard Form 364, Report of
Discrepancy (ROD).
c. If there are in-transit damages, the Transportation Specialist will prepare a Standard
Form 361, Discrepancy in Shipment Report, and forward copies to the GPA, the
Government Transportation Officer, and the Defense Finance and Accounting
Service (DFAS) for presentation of a claim by the appropriate government office
against the carrier.
d. Misdirected shipment will be processed in accordance with the contract and
redirected if the ship to location of unit is known or can easily be obtained, if not the
unit will be processed as a discrepancy above.
e. When property is received which has been directed elsewhere, receiving personnel
will notify Receiving and Property Management of the shipment. Receiving
management will segregate the material to prevent loss or damage and place
identifying markings on the shipment "AWAITING DISPOSITION" and the name
of a point of contact. Copies will be made of the bill of lading and any
accompanying documentation and forwarded to the Contracts department and the
Defense Contracts Management Agency (DCMA) property representative. The
shipment will be held until disposition instructions are received from the customer.
f. When property is received from suppliers, the receiving personnel will take all
necessary actions in adjustment of overages, shortages, or damages and note the
actions on the receiving report. Discrepancies with supplier shipments may need to
be coordinated with the buyer to ensure timely resolution.
Identification Process
1. Tagging
a. Property Management shall:
1) Maintain identification systems for tag-controlled property.
2) Establish and maintain serialized property control number registers for the
purpose of recording required data regarding each assigned property number.
3) Obtain copies of receiving and fabrication documents (e.g., receiving

documents, job orders, etc.) and determine proper classification, ownership, and
identification requirements.
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4) Upon notification of the receipt of an asset, or the completion of fabrication of
an item, notify the owning Program Manager or Supervisor, Government Property
Administrator (GPA) if required, and the Quality Analyst of receipt of government
property for verification of receiving paperwork, quantity or damage during
shipment. Property Management will apply the appropriate control tag to the asset.
Property is normally identified with a bar code label affixed to the property.
Indelible ink, acid, or electric etch, steel die, or other legible, permanent,
conspicuous, and tamper proof method may be used if it is impractical to use a
metal tag or decal. Tags are affixed where they may be readily seen, do not
interfere with the operation of the property and do not require frequent cleaning. If
the property is from another location and already tagged, the old tag may be
removed and re-identified using company property tags or the old tag may remain
on the asset if directed by contracts. When the old tag is removed, it will be
referenced in the business system.
5) Update the Business System to record the tagged items and then a copy of the
receiving document will be filed. Provide replacement property tags when notified
that they are lost, damaged, or destroyed. Cross-reference the tags in the business
system.
6) When new asset tags are required, either government or company, tags will be
ordered from an approved source.
b. The Program Manager or Supervisor shall:

1) Forward copies of procurement or fabrication documents (e.g., purchase
contracts, manufacturing orders, job orders, etc.) for all government property to
Property Management.
2) Ensure appropriate tag has been placed on the property.
c. Property management will tag and record company-owned capital and expense property
in the business system.
2. Types of Property Identification

a. Property, which is tagged, etched, or otherwise physically marked, is normally marked
with a property control number. (describe the number’s construct)
b. The following types of property shall be identified:

1) Special Tooling (ST).
2) Special Test Equipment (STE) systems and removable components.
3) Plant Equipment (PE).
4) Government Furnished Property (GFP)
5) Leased property accountable to a government contract.
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6) Property, which is normally not assigned property control tags, may, if desired,
be identified by Property Management as to Government, Commercial, or
Company ownership by attaching a non-serialized property control tag indicating
ownership.
3. Exceptions to Tagging Requirements

a. Property Management will not tag, etch, or otherwise identify property with a serialized
number if it is:
1) Acquired for consumption or destruction in test.
2) Property that will be used in such a manner or in an area where the property tags
is subject to damage or destruction (e.g., acid baths, heat tests). The Program
Manager or Supervisor will maintain a file consisting of tag number, calibration
data if required, and all other tag information.
3) Too small to accept a tag. Asset will be put in container and the container will
be tagged. The Program Manager or Supervisor will locate asset upon request.
4) Of a nature where attachment of a tag could interfere with its function or cause
damage to the item. Asset will be put in container and the container will be
tagged.
5) Computer monitors received for Information Technology will be identified with

The Company logo unless purchased with government funds and then they will be
identified as government property.
References
Procedures Outcome 3 – Government Property Records
Forms DD Form 361, Transportation Discrepancy Report (TDR)
DD Form 1149, Requisition and Invoice/Shipping Document
DD1348-1A, Issue Release/Receipt Document
DD1348-2, Issue Release/Receipt Document With Address Label
DD Form 1907, Signature and Tally Record
DD Form 2332, Product Quality Deficiency Report Exhibit
DD Form 250, Material Inspection and Receiving Report
SF364, Report of Discrepancy (ROD)
Other FAR 52.245-1, Government Property
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Outcome 3 – Government Property Records
This procedure documents the assignment of responsibilities and steps performed to ensure that
appropriate property records are established in accordance with the Corporate Property
Management Plan, regulations and the contract.
The target audience for this procedure is all employees that have the responsibility to affect the
recording and posting of property records.
Requirements
In accordance with contract provisions, FAR 52.245-1(f)(1)(iii), Records. The BU Property

Management Office (PMO) is directly or indirectly responsible for creating and maintaining
property records for all GP provided or acquired during contract performance.
BU personnel, as delegated by the PMO, shall establish and maintain the property records.
Systems of record shall be access controlled to limit unauthorized transactions. Personnel may
access the system and effect the creation, record maintenance and/or item’s shipment. The
records shall be supplemented by transactional documentation such as receipts, shippers
(government forms DD1348-1, DoD Single Line Item Release/Receipt Document, DD1149,
Requisition and Invoice/ Shipping Document, DD250, Material Inspection and Receiving
Report), POs, packing slips, government property transfer passes, emails, move documents,
Request for Disposition sheets, and/or any similar campus generated documentation.
The using department may have custodial records or other databases that may assist the PMO
with the management and accountability of property. These secondary records may enhance
the locator system.
Records for GP/customer property (CP) scrap, abandonment, and/ or salvage shall be processed
in the most efficient manner and documented, as necessary, by the PMO. The applicable system
of record shall be updated to reflect the disposition of the assets.
Inputs/ Outputs
Inputs Outputs
• Receipt for Property or • Asset Record
equivalent • Material Record
• Purchase Order/Packing Slip • Returned Material for Repair
• Internal or External Shipment (RMR) Record
forms/Systematic notification
• BU Form, In-House Constructed
Equipment Report or campus
equivalent
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Procedure
The following steps/ actions identify the sequence to be performed and the individual or
function responsible.
PMO or Designated Personnel
1. Provides oversight for all campus systems of record for GP/CP and
documentation for authorized record adjustments, as required.
2. Establishes and maintains the property records for Special Tooling (ST), Special Test
Equipment (STE), GP or CP, Equipment, Plant Equipment, and completed products
while in the possession of the BU.
3. Establishes and maintains RMR and material records, recording the following data:
• Contract number or equivalent code
• Part number and/or model number
• Manufacturer
• Unique Item Identifier (bar code, label and/or U.S. government Item Unique
Identification (USG IUID). Campus supplemental marking is applied and
related to the system of record to support effective and efficient asset
management.
• Nomenclature or description of the item
• NSN (National Stock Number), if required for additional item identification
tracking and/or disposal
• Serial Number, if required for item discriminator
• Quantity: received/ fabricated, issued and balance on hand
• Unit of measure
• Posting reference and date of transaction
• Location
• Disposition
• Date placed in service (other than material)
• Unit acquisition cost/ price
4. Acquires the unit price for government or customer furnished property from the incoming
documentation and incorporated in the official record.
5. Ensures that records reflect unit prices maintained by data system tables, when applicable.
6. Seeks other unit price sources for property supplied without paperwork or incomplete
paperwork, such as:
• NSN stock listed price (FEDLOG) or other internal databases for a legitimate price.
• A unit price for BU purchased items is derived from the P.O. Material accounting
data is maintained via the Enterprise Resource (ER) Materials Management module.
Material accounting data for non-ER sites is maintained via the site’s Materials
database.
7. Records reusable containers that correspond to an item of ST or STE, classifying them
respectively as ST or STE.
8. Records all other reusable containers as equipment, including those made of wood or
17
cardboard that are forwarded to the warehouse for storage or disposal (otherwise these are
exempt from record requirements).
9. Initiates an Inventory Adjustment Voucher or campus equivalent, to adjust inventory
variances or add items to the system of record in the absence of any source documents/
receiving paperwork.
PMO and/or Repair Operations
10. Records misdirected item receipts on the respective campus database upon receipt.
11. Redistributes misdirected items when the original shipper provides funding for
transportation expenses or makes arrangements to pick up the items.
PMO
12. Pursues direction for government property via the Materials Returns Program and/or
direction from the customer.
13. Targets to redirect misdirected items within 60 days from the time of receipt.
14. Updates the applicable database record when shipment or disposal occurs.
Engineering, Manufacturing Operations
15. Creates and maintains storeroom records to account for work-in-process materials,
maintaining a debit and credit system which provides a detailed audit trail.
16. Provides inputs to the PMO through systematic processes of new tooling, test
equipment, and equipment acquisitions to ensure appropriate property records are
established.
17. Provides the PMO with BU, In-House Constructed Equipment Report, or campus
equivalent.
References
Forms In-House Constructed Equipment Report
Inventory Adjustment Voucher
Other DD Form 250, Material Inspection and Receiving Report
DD Form 1149, Requisition and Invoice/Shipping Document
DD Form 1348-1, DoD Single Line Item Release Receipt Document
FAR 52.245-1(f)(1)(iii), Records
Outcome 4 – Physical Inventory

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This procedure documents the assignment of responsibilities and steps performed to initiate
physical inventory of GP/CP and provides related direction to personnel.
The target audience for this procedure is all employees that have the responsibility to account
for GP/CP.
Requirements
The Business Unit (BU) is required to conduct physical inventories of GP/CP in accordance with
Federal Acquisition Regulations (FAR) 52.245-1(f)(1)(iv), Physical inventory. Physical
inventories of GP/CP shall be conducted on a periodic basis and upon contract completion or
termination, as required. Contracts with property shall be scheduled for physical inventory on
a biennial basis (even/odd year plan based on prime contract or ‘start’ date), unless the
frequency for periodic inventory is otherwise stipulated in the contract or campus work
instructions. The contract’s performance period end date shall prescribe when to conduct a final
physical inventory to allow the BU to efficiently apply inventory resources.
In accordance with leading industry standards, specifically American Society of Testing Material
(ASTM) E 2132, Physical Inventory of Durable, Movable Property, the BU shall physically
inventory sensitive property and equipment with an acquisition value greater than the established
capital threshold. The physical inventory process shall consist of four steps:
• Planning.
• Data Collection.
• Reconciliation.
• Reporting.
The BU inventory responsibilities are delineated in government contract clauses, which normally
identify two types of mandatory inventories:
• Periodic.
• Contract Termination or Completion Inventories.
Physical inventories shall be conducted in an uncompromising manner as it is an integral
function of asset management and the overall system integrity is predicated on them. When
available, the use of scanning equipment, which enhances the integrity of the overall process,
shall be considered when conducting physical inventories. When practical, personnel who
perform physical inventories shall not be the same individuals who maintain the property
records or have custody of the property unless authorized to do so at the discretion of the
campus PMO Management.
Inventory Methods
The BU shall use the following methods to perform inventories:
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• Physical inventory - Physically inventory all GP/CP when it
enters disposition for contract termination, contract completion or
declared as excess inventory. Physically inventory GP/CP assets that
do not have an acceptable inventory date.
• Inventory by exception - Inventory by exception of GP/CP
assets when the property is moved or has an acceptable inventory
date. Acceptable automated updates to the system of record may be
achieved via bar code or RF scanning device downloads or when
movement transactions are posted. Also, periodic random statistical
sampling of binned material of Contractor Acquired Material (CAM)
storerooms that maintain a
95 percent or greater accuracy level meets the criteria for
inventory by exception.
• Inventory by cycle count – the BU may exercise the option to
cycle count or conduct an annual physical inventory of material.
• Special Inventory – the BU may be tasked to locate items when
performing audits or when addressing specific customer requests.
Inputs/ Outputs
Inputs Outputs
• Asset Listing • Inventory Report (Periodic or
• Material Listing, if applicable Final
• Physical Inventory or Sample • Inventory Adjustment
Results Voucher(s), as required
• Loss Report(s), as needed
Procedure
Property Management Office (PMO) or Designated Personnel
1. Schedules periodic inventories at the beginning of each calendar year.

2. Conducts periodic physical inventories/sampling throughout the life of a contract,
following the direction of Work Instruction, Physical Inventory and Material Sampling,
or campus equivalent, to conduct, reconcile, and report periodic physical inventories.
3. Coordinates inventory actions with Program Management, subcontractors, and alternate
site locations when performing periodic and final inventories.
4. During the contract closeout process, ensures all government/ customer residual material
and property is recalled, if required, and processed in accordance with contractual and
regulatory requirements.
20
5. During a final inventory (closeout process), emails the respective Program Manager
ordesignated representative, as required, requesting that they declare any GP/CP that is
required to be identified (specifically on cost type contracts), confirm they have in
their possession recorded property and recall, as necessary, all GP/CP and residual
material related to a specific contract (sales orders (SOs)/work breakdown structures
(WBSs)/projects).
6. Conducts a complete physical inventory for terminated or completed contracts, if required.
7. Conducts a physical inventory for those items authorized for contract transfer, if required.
8. Conducts a physical inventory of GP/CP assets during assessments and/or customer audits.
9. Effects property transfer or reports inventory results to respective customer.
10. Upon contract completion and/or termination, conducts and directs
subcontractors to perform a physical inventory of the remaining property
adequate for disposal purposes.
Program Management, Area Management or Property Custodian
11. Assists the PMO during the inventory process to reconcile inventory anomalies.
Directs lab managers, area supervisors and property custodians to assist with inventory
reconciliation, as required, and provide paperwork for items that have been relocated,
shipped or returned to the customer.
Program Manager
12. Assists the PMO, as required to complete a final inventory and directs respective lab
managers and area supervisors supporting their program(s) to identify residual
property.
Subcontracts Management
13. Assists the PMO with periodic supplier assessments to ensure that
subcontractors validate property in their possession, as required.
Materiel Control
14. Conducts random sampling of storeroom material to ensure records are adequate
and acceptable inventory accuracy levels are maintained. As necessary, develops a
corrective action plan to attain acceptable inventory accuracy levels.
Contracts Representatives
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15. Forward inventory results to the customer, as required.
References
Procedures Work Instruction, Physical Inventory and Material Sampling
Other ASTM E 2132, Standard Practice for Physical Inventory of Durable,
Moveable Property
FAR 52.245-1(f)(1)(iv), Physical inventory
Outcome 5 – Subcontractor and Alternate Site Government/ Customer

Property Management

This procedure documents the assignment of responsibilities and steps performed to ensure
government or customer property (GP/CP) is properly managed when located at subcontractor or
alternate site locations.
for GP/CP.
Requirements
The Business Unit (BU) shall ensure that all subcontractors and alternate sites, which possess
or control GP/CP loaned to them or manufactured by them for the performance of purchase
orders, adequately maintain the property in accordance with the provisions of the
subcontract/purchase order.
An off-site location is essentially an extension of the BU, whereby BU personnel are assigned to
the respective site and property shall be assigned to these individual(s) as applicable. An off-site
location is further defined as any location other than BU campuses that have in their possession
GP/CP that the campus Property Management Office (PMO) is responsible for and is not
associated with a BU purchase order/subcontract.
The PMO shall ensure receipt of inventory results, and supporting documentation, as required,
from the subcontractor and alternate site program personnel, certifying that the property is in
their control/ possession. Off-site locations are managed by or fall under the jurisdiction of
the campus PMO and are subjected to the property controls outlined in the applicable
government property procedures, unless otherwise waived in writing by PMO Management.
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Inputs/ Outputs
Inputs Outputs
• DD Form 1149 • System of Record updated
• Vendor Move Order • Property Listings
• Subcontractor/Alternate Site
Property Listings
• Packing Slips
• Other shipping documents
Procedure
Procurement or Subcontracts Management
1. Ensure that BU Purchasing procedures provide guidance and detail standard flow
down clauses for the purpose of controlling, maintaining, reporting, and recalling GP/CP
located at suppliers, and include the PMO in the stakeholder review process for proposed
changes to procedures and/or unique property flow down language.
2. Ensure that appropriate language and clauses are delineated in the subcontract, purchase
order, or internal work order (IWO) to mutually protect the interest of the
government, customer and the BU when property is acquired or fabricated by a
subcontractor or sent to a subcontractor.
3. Supplement the PMO or its designee, as necessary, with subcontractor or alternate site
GP/CP oversight, property system analysis, annual certifications/inventory requirements,
and recall or disposal of identified excess property.
4. Include site PMO in the pre-award survey of a new supplier when GP/CP will be
involved.
5. Seek guidance or assistance to ensure the supplier’s property management system and
written procedures will be adequate prior to the issuance of a purchase order. If
available, a copy of the supplier’s system approval/status letter from the overseeing
Government agency indicating an adequate property system is in place, may alleviate the
need for the PMO or it’s designee to visit the subcontractor and conduct a pre-award
survey.
6. Coordinate the transfer of property to a follow-on order, and the return, and/or
disposal of GP/CP in accordance with the contract, program initiatives, and/or PMO
direction, prior to the close-out of the subcontract and/or purchase order.
7. Ensure that contractually required reports include subcontractor supplied data as
necessary.
8. Ensure subcontractors report loss (including: damage, destruction or theft) of property in
their possession in accordance with the terms and conditions delineated in the
contractual arrangement, and prior to closure of the subcontract, purchase order,
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and/or internal work order (IWO). All Loss liability cases shall be resolved prior to
subcontract, purchase order, or internal work order closure.
Business Unit, Supply Chain Management (SCM)
9. Upon supplier notification of debarment, suspension, insolvency, bankruptcy or

business dissolution, immediately initiates action to recover property provided under the
subcontract or purchase order.
PMO, Inventory Coordinator (IC) or Designated Personnel
10. Maintain property records for GP/CP in the possession of subcontractors or at alternate
sites, unless otherwise directed by the PMO.
11. Require subcontractors and alternate sites to maintain a basic record system to readily
assist the BU Subcontracts or PMO with locating, inventorying, disposing, and/or
returning the property, as necessary.
12. Maintain a file for each subcontractor and alternate site location and a status of
inventory activity. The respective requirements for each are as follows:
• File - site surveys, certifications/inventory report, correspondence,

property movement and/or return documentation and any related site directives
regarding the control and maintenance of BU managed property.
• Status - status (active or inactive), site address, point of contact,
property in their possession, property type, number of units, value, last
certification date, last PMO visitation (if applicable), open action items and
person responsible to ensure actions are being addressed and a summary of
most recent activity.
13. Formally request from each subcontractor or alternate site identified as
possessing GP/CP to report and/or certify the property in their possession for BU
managed contracts, subcontracts, or purchase orders annually or as necessary. Email and
electronic files shall be used to the maximum extent to communicate with the
subcontractor or alternate site.
14. Status the subcontractor or alternate site responses until adequate reconciled inventory
information and/or applicable corrective action plans or Loss reports are received.
Refer to Work Instruction, Government Property Subcontractor and Alternate Site
Certification, or site equivalent for additional guidance.
15. Upon receipt of the certification results from the subcontractor or alternate site, ensure
that the property records are updated with the most recent inventory information; review
for the last date used; review for authorized use of property; coordinate and status any
open issues with the site PMO and/or Subcontracts Manager/Buyer.
16. Survey newly established site subcontractor or alternate site’s property control systems
at the discretion of campus PMO management.
17. Conduct an on-site review and sampling of the property controls at site PMO
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management’s discretion. Surveys shall be accomplished in accordance with Work
Instruction, Government Property Subcontractor and Alternate Site Certification, or site
equivalent, and the below guidance.
Campus management may elect to visit those entities that demonstrate any of the
following:
• Non-responsiveness to contract provisions.

• A significant amount of property (over $500,000 of property and 50
assets).
• A high incidence of Loss.
• An inadequate government property management plan/ system.
• An inadequate self assessment report.
18. Advise Procurement when the outcome of a subcontractor or alternate site’s
surveillance results is less than adequate.
SCM Personnel/ Subcontracts
19. Issues written notification to the subcontractor or alternate site directing a

deficiency correction. If necessary, requests a corrective action plan to include
milestones and an estimated date of completion.
PMO, IC or Designated personnel
20. Coordinate follow-up surveillance at the subcontractor or alternate site to ensure

compliance with the corrective action plan.
21. Recall, as necessary, GP or CP that has not been used in the past six to twelve months
which is considered idle. Recurring subcontracts or purchase orders requiring the use of
the property in question may dictate its retention by the supplier to reduce the chance for
the property to be lost or damaged in transit.
22. Engage with Subcontracts Manager/Buyer and Program Management to
coordinate with the respective supplier retention provisions.
23. Inform, in writing or email, the responsible campus PMO that there is idle or excess
property at the respective subcontractor or alternate site, including a listing of the
items.
Campus PMO
24. Conducts asset reviews utilizing the retention justification letter or email
equivalent, with applicable information indicating that the idle property is in the
possession of a subcontractor or alternate site location BU Form, Retention Justification
Request Letter).
25. Notes the subcontractor file if the Program Office indicates there is an authorized need for
this equipment for future requirements.
25
26. Takes steps to ensure that idle or excess property in which a current or future need
does not exist is properly recalled or placed on an inventory disposal schedule by the
subcontractor or alternate site. Idle or excess property will be returned to the BU only
as necessary.
Program Manager, SCM Administrator, Contracts
27. Determines property’s future requirements.

28. Assists the PMO with determining if property at a subcontractor or supplier should
be recalled or disposal initiated based on firm requirements: current and/or future
needs for the property.
References
Procedures Work Instruction, Government Property Subcontractor and Alternate Site
Certification
Forms Retention Justification Request Letter
Outcome 6 – Government/ Customer Property Reports

This procedure explains the requirements and outlines the responsibilities and process for
providing contractually required GP/CP reports.
for GP/CP.
Requirements
In accordance with contractual requirements and Federal Acquisition Regulations (FAR)
52.245-1 (f)(1)(vi), Reports, Federal Aviation Administration (FAA) AMS 3.10.3, FAA
Acquisition Management System (AMS), National Aeronautics and Space Administration
(NASA) Supplement to the FAR Supplement (NFS) 1845.505-14, Reports of
Government Property, or NFS 1845.7209-3, Loss, damage, or destruction of Government
property while in contractor’s possession or control, processes shall be
established to create and provide as required the following types of reports:
• Reports of physical inventory results

• Reports of Discrepancies
• GP/CP Financial reports
• Loss reports (including: theft, damage and/or destruction)
• Reports of audit and self assessment results
• Reports of corrective action
26
• Other contractually required reports
Loss reporting for property with a value below the established capital threshold may be
deferred until contract completion or termination.
Capital and company property incidents of Loss shall use the same internal reporting process
and forms, as applicable.
Inputs/ Outputs
Inputs Outputs
• Property Listings • Property Reports
• Subcontractor/Alternate • Subcontract/Alternate Site Property
Site Property Listings Reports
• Systems of Record • Systems of Record Property Reports
Property Listings • Unique Identification (UID) Registry
• Loss investigation Property Reports
worksheet/report, if • DD Form 1662 or equivalent
applicable • Loss Trend Log/Reports
• Defense Contract Management
Agency (eTools Loss report)
Procedure
responsible.
Property Management Office (PMO) or Designated Personnel
1. Provide internal and external customers with timely inventory, financial, Loss and other
special reports, as required. Correspondence will be sent via Contracts when required.
2. Submit inventory reports to the Administrative Office (AO) Property Administrator or to
the respective customer representative upon the completion of the physical inventory (PI)
and reconciliation of records, ensuring PI is accomplished in accordance with Work
Instruction, Government Property Inventory, and applicable campus work
instructions.
3. Submit contract certification upon the disposal of all GP/CP and the resolution of all Loss
cases.
4. Submit annual financial reports to the respective customer representative and/or AO
Property Administrator, as required, ensuring reports include property located at
subcontractor/ alternate sites. Transmit via electronic file transfers in lieu of providing
hard copy reports, when possible.
5. Prepare and submit financial reports: DD Form 1662, DoD Property in the Custody
of Contractors, and/or NASA Form 1018, NASA Property in the Custody of Contractors,
and/or FAA financial format, as required. Ensure reports detail the acquisition value of
all GP/CP by contract as of September 30 and are submitted no later than October 31 each
27
year, unless otherwise requested by the customer. DD Form 1662 will be required
when the Department of Defense (DoD) FAR Supplement (DFARS) 252.245-7001,
Reports of Government Property, is delineated in the contract.
6. Submit a final inventory report when a contract is closed, terminated, or certified, as
required.
7. Provide special reports as required to facilitate business objectives and audit or assessment
functions.
8. Upload DoD’s UID registry with the required data for property meeting the criteria for
reporting and/or marking or as delineated in the contract when DFARS
252.211-7007, Item Unique Identification of Government Property, is cited.
Contracts that are reported to the UID registry do not require the submittal of a
DD Form 1662.
9. Upload, using a flat file protocol, the required data to the UID Registry for that property
meeting the Unique Item Identifier (UII) criteria and as required submit registry updates.
Do not upload material and repair assets to the UID registry unless specifically
required by the contract.
10. Review and validate property unit price information periodically to ensure that the financial
data is accurate.
11. Acknowledge Loss declarations from property custodians, coordinate the
development of a preliminary Loss report and submit it to the AO Property Administrator or
the customer representative within two working days, informing them of the incident.
12. Bring major incidents of Loss such as those caused by fires, explosions, storms, etc. to the
immediate attention of the AO Property Administrator and/or customer representative office
when practical.
13. Initiate a Form, Loss Investigation Worksheet/ Report or campus equivalent, as applicable,
and maintain an internal log for trend analysis.
14. As soon as all facts are known regarding the GP/CP loss incident, submit a report in a
timely manner to the AO Property Administrator or customer representative. It is
recommended that within 30 days from the time the investigation and report was initiated that
the final report be submitted to the customer or the details of the Loss incident be uploaded
to the DMCA eTools Loss online system.
15. Follow the following guidance when reviewing and reporting incidents of loss to the
respective customer. Ensure preliminary loss reports include the information required to
satisfy the first four bullets below, and the official Loss Report includes all of the
following information when completing a Loss Report, formatted letter or campus
equivalent:
• The date (if known) of the loss

• Quantity
• A description of the item(s) lost, damaged, destroyed (inclusive of part number,
serial number, nomenclature, and unique identifier,Manufacturer, Model Number,
National Stock Number (if applicable) or personnel may reference an attached
Form, Inventory Adjustment Voucher (IAV), or campus equivalent form).
• The BU contract, subcontract, and/or vendor purchase order
28
• A statement indicating current or future need
• The acquisition cost of the property, or if applicable, estimated scrap proceeds,
estimated repair or replacement costs
• All known interests in commingled property of which the GP/CP is a part
• Cause and corrective action taken or to be taken to prevent recurrence
• A statement that the customer will receive any reimbursement covering the loss
incident in the event the BU was or will be reimbursed or compensated
• Copies of all supporting documentation
• Last known location
• A statement that the property did or did not contain sensitive or hazardous
material, and if so, that the appropriate agencies were notified
16. Complete an IAV or campus equivalent for confirmed losses or inventory shortages to
document and record adjustments. Submit the completed IAV as an attachment to the
Loss, when applicable.
17. Reconcile and report losses that occur during a scheduled physical inventory and/or
periodic material cycle counts as part of the Inventory Reporting process.
18. Re-establish property records for found items that were previously reported as a loss and
notify the customer or the DCMA PA, as applicable.
19. Provide ad hoc reports to Executive and/or Program Management, as required.
20. Provide reports to support audits, assessments, metrics, and/ or corrective action plans.
Program Manager, Area Manager, Property Custodian or Subcontractor
21. Immediately upon incident of loss of GP/CP, notifies the campus PMO of the
occurrence. Personnel knowledgeable of the situation may be tasked to assist the PMO
with reviewing the incident and, as necessary, formulate a corrective action plan to
prevent reoccurrence of similar nature.
References
Procedures Outcome 4, Physical Inventory
Forms DD Form 1662, DoD Property in the Custody of Contractors NASA
Form 1018, NASA Property in the Custody of Contractors Inventory
Adjustment Voucher (IAV)
Loss Investigation Worksheet/ Report
Other DFARS 252.211-7007, Item Unique Identification of Government Property
DFARS 252.245-7001, Reports of Government Property
FAR 52.245-1, Government Property, (f)(1)(vi) Reports
29
Outcome 7 – Government/ Customer Property Relief of Stewardship

To establish the requirements and instructions for declaring excess property to the customer, as
well as initiating and accomplishing property disposal.
The target audiences for this procedure are property custodians, area supervisors, Contracts,
Programs, Engineering, Procurement, Operations, Materials Management and the Property
Management Office (PMO).
Requirements
The Business Unit (BU) shall process excess GP/CP in accordance with Federal Acquisition
Regulation (FAR) 52.245-1(f)(1)(vii), Relief of Stewardship.
Property excess to the government or customer shall be disclosed and reported when it is no
longer required to fulfill contractual obligations. Relief of stewardship responsibility shall take
place when:
• Property is disposed in accordance with contract instructions.
• Consumed or expended during contract performance.
• Processed through an inventory adjustment.
• Delivered or shipped under government instructions.
• Relieved of accountability through a Loss report(s).
• Processed as production scrap or testing scrap or through the approved scrap
procedure.
• Processed through Plant Clearance Automated Reutilization Screening System
(PCARSS) or other agency approved reporting methods to obtain disposal instructions.
• Abandoned in accordance with contract terms.
The BU shall dispose of GP/CP in accordance with the following methods, and this protocol shall
be followed in the event the customer notifies the BU of a termination or partial termination and
GP/CP is prevalent:
• Purchase or retention of Contractor Acquired Property (CAP) by the BU or its
subcontractor(s).
Make reasonable efforts to return unused CAP to suppliers at fair market value (less, if
applicable, a reasonable restocking fee that is consistent with the supplier’s customary practices).
The Contracting Officer (CO), Plant Clearance Officer (PLCO), Buyer or customer
representative may direct the BU to:
• Transfer to another contract or to a government entity through the application of
prescribed screening procedures.
30
• Sale (including purchase at fair market value by the BU, subcontractor, or
interested party).
• Donation to public bodies.
• Abandonment or destruction (scrap).
Approved Scrap Procedure

This procedure along with supplemental campus and departmental procedures and practices to
effectively and efficiently gather scrap materials; the negotiation and collection of fair market
value for scrap; and application of scrap proceeds to an overhead account reducing material
burden or directly to a contract in accordance with accounting protocol and the campus’ cost and
disclosure statement constitutes the BU’s approved scrap procedure.
Contract Closure
Disposal of excess and/or residual GP/CP shall be given due attention and disposed of in a timely
fashion to achieve contract closure in accordance with Procedure: Contract Closeout, and
Outcome 10, Government/ Customer Property Closure. The BU personnel shall refer to
Procedure: Contract Termination, or campus equivalent, in the event of a partial or complete
termination.
Inputs/ Outputs
Inputs Outputs
• Shop Floor, Engineering Lab, • Program Office retention
Storeroom declared excess justification
• Idle Asset Retention Reviews • Inventory Disposal Schedules or
• Procurement Contracting PCARSS input
Officer (PCO), Administrative • DD Form 1149, Requisition
Contracting Officer (ACO) or and Invoice/Shipping
Buyer direction Document: Shipment, Sale,
• PCARSS or PLCO direction Scrap or Abandonment
• Contractual Requirements • DD Form 1348-1, DoD Single
• Unfunded Returned Material for Line Item Release/Receipt
Repair (RMRs)/Misdirected Items Document: Shipment
• Recommended Scrap Items: • Standard Form (SF) 153,
Beyond Economical Repair COMSEC Material Report
(BER) or Beyond Physical • Retention Agreements
Repair (BPR) items • Memorandums of
• Subcontractor/Alternate Site Understanding (MOUs)
• Contract Modifications
31
Property Excess Listings • Other applicable transactional or
shipping documentation, as
required.
• Loss Reports/Inventory
Adjustment Vouchers (IAVs)
Procedure
Program Managers, Repair Operations, Area Supervisors and, Property Custodians
1. Coordinate disposal of excess GP/CP, including material, with the PMO during contract
performance as necessary. Identify, organize, and itemize property for disposal using
Form, Request for Disposition/Storage of Government Property, or campus equivalent
and coordinate the removal of GP/CP from their areas in accordance with the campus’
material handling practices.
2. Establish collection points for production scrap and process it in accordance with
Procedure, Generated Scrap, Work Instruction(s): Scrap Material, or Repair Center
Scrap Material Processing, or campus equivalents, as applicable.
3. Provides property that meets any of the following criteria to the campus PMO or
Security(*), as applicable, for appropriate disposal (it shall not be treated as
‘production scrap’):
• Requires demilitarization per Defense Demilitarization Manual DOD

4160.21-M-1 (Oct, 1991).
• COMSEC* (Communications Secure) devices.
• Is a classified item *;
• Is generated from classified items *;
• Contains hazardous materials or hazardous wastes;
• Is generated from precious metals; or
• Is dangerous to the public health, safety, or welfare.
Engineering
4. Processes excess property in accordance with Procedure, Disposition of Government-

owned Materials in Engineering Laboratories, or campus equivalent and coordinates with
the PMO Administrator, as necessary.
32
Program Management or Repair Operations
5. Identify misdirected items upon receipt or advise the PMO to dispose or return items sent
in for repair that will not or can not be repaired.
6. Periodically review campus ‘Held for Funding’ items, for those non-funded or non-
inducted repair candidates and provide direction.
7. Coordinate the disposal of residual material lay-in in accordance with customer or
contract direction.
Procurement or Supply Chain Management
8. Issues a formal bid for scrap sales in accordance with Procedure, Scrap Sales, or
campus equivalent. Handles proceeds from a scrap sale in a manner consistent with
the campus’ cost accounting practices. The PMO shall participate in the bid
process as required.
9. Coordinates and/or assists the PMO in the transfer, disposal and/or return of
GP/CP located at a subcontractor.
10. Reconciles with the PMO and as necessary directs the subcontractor to submit a
Loss report
11. Addresses Loss liability in accordance with subcontract terms and conditions and passes
any GP/CP reimbursement by the subcontractor related to Loss incident on to the
customer.
PMO or Designee
12. Receives GP/CP from Engineering, Operations, Materials Management, property

custodians and/or subcontractors.
13. Processes above for disposal including accomplishing a physical inventory,
reconciling variances with the respective parties (as required), preparing
inventory schedule(s) or entering data into PCARSS, storing, and exercising final
disposition.
14. Submits expended property on a scrap listing to the respective customer or
processes via PCARSS.
15. Submits declared GP/CP excess on inventory disposal schedules to the
respective customer or through the PCARSS process (reference Work
Instruction, Government/Customer Property Reutilization Screening and Plant
Clearance).
16. Coordinates GP/CP transfers with Contracts Representative, Buyer, or
Subcontracts Administrator, as required. Transfers GP/CP via DD Form 1149, FAA Form
4650-12, Material/ Requisition/Issue/Receipt, or equivalent to a follow contract as
directed by the contract or subsequent modification. The FAA Property Administrator
provides ES with FAA Form 4650-12.
33
17. Provides shipping documentation, specifically DD Form 1149s and DD Form
1348-1s, FAA Form 4650-12 or SF 153 when returning GP/CP to the customer or
abandoning/scrapping in-place.
18. Submits Loss reports to the Administrative Office (AO) Property Administrator or
customer representative as required and adjusts records via an IAV.
19. Return, re-induct for rework or scrap BER or BPR items as directed by the
contract, plant clearance process, Programs and/or Contracts.
20. If property is not returned to the government, ensures removal of any markings
identifying the property as U.S. government owned property prior to its disposal.
21. Affects demilitarization and disposal of hazardous property in accordance with
direction received, the campus’ destruction capabilities and Environmental, Health
and Safety inputs, as required. If destruction capabilities do not exist or it is cost
prohibitive for the campus to handle the destruction, other alternatives may need to
be pursued, such as: return to the customer or agency, send items to the closest Defense
Reutilization Marketing Office (DRMO) or seek an equitable adjustment to follow
through with required actions.
Security
22. Coordinates the disposal of COMSEC and/or sensitive GP/CP items with the
PMO, as required.
Program Management (PM)
23. Directs and/or coordinates disposal of excess property and/or customer owned material
with the functional departments and the PMO during contract performance.
24. Establishes a plan of action for the disposal or transfer of residual GP/CP in
advance of the contract’s period of performance end date.
25. Accelerates the disposal activity considering current and future Program needs,
whenever possible, in order to accommodate timely closure or certification of a contract.
26. Ensures efforts to dispose of the remaining assets are given prompt attention and
follow-up, as necessary.
Campus PMO
27. Assists with above, as required.
PM
28. Screens the residual property and/or material for use on active or anticipated follow-
on government contracts.
29. Submits all requests for retention and/or recommendations regarding the future utility of
the residual property to Contracts Representative and/or PMO Administrator.
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Materiel Control
30. Documents consumption of contract material and/or its return to stock in

accordance with campus Materiel Control procedures.
31. Purges existing storerooms of any declared excess or residual contract inventory in
accordance with the title provisions or as directed by the PMO and/or campus procedures.
Contracts Representative or Designee
32. Provides the following shipping documents, preferably system generated, when
required:
• DD Form 250, Material Inspection and Receiving Report,

• FAA Form 256, Inspection Report of Material and/or Services,
• BU Form, Invoice/Shipment Commercial (system generated or campus
equivalent), and/or
• BU Form, International Invoice or Shipper (ITAR).
33. Seeks authorization to return, repair under separate contract or CLIN, or dispose of BER
or BPR items from the customer in accordance with Procedure, Letters to Contracting
Officers Concerning Government or Customer Property.
34. Provides government/customer disposition instructions or clarification to existing
instructions for GP/CP, as required.
35. Requests Contracting Officer/Customer Representative/ Buyer authorization to transfer
remaining property and/or residual material to active government contracts, when
applicable.
References
Procedures Contract Terminations
Contract Close-out
Letters to Contracting Officers Concerning Government or Customer
Property.
Disposition of Government-owned Materials in Engineering Laboratories
Scrap Material
Scrap Sales
35
Generated Scrap
Work Instruction, Government/ Customer Property Reutilization Screening and
Plant Clearance
Outcome 10, Government Property Closure
Repair Center Scrap Material Processing
Forms DD Form 1149, Requisition and Invoice/Shipping Document
DD Form 1348-1, DoD Single Line Item Release/Receipt Document
SF 153, COMSEC Material Report
BU Form, Invoice/Shipment Commercial
BU Form, International Invoice or Shipper (ITAR)
Other FAR 52.245-1(f)(1)(vii), Relief of Stewardship
Outcome 8 – Government Property Utilization

This procedure documents the assignment of responsibilities and steps performed to ensure that
property is moved, stored, consumed, and utilized as authorized and in accordance with the
Corporate Property Management Plan, regulations, and contract requirements.
The target audience for this procedure is all employees that have the responsibility to affect
movement, storage, consumption and utilization of government or customer property (GP/CP).
Requirements
GP/CP, whether furnished or acquired, shall only be used for the purpose for which it was
acquired or as authorized. Systems have been established for ensuring that property is authorized
for use. When necessary, rent-free, non-interference use shall be requested. Property is utilized
and or consumed to its maximum capacity, and shall be declared excess when no longer
contractually required for retention. Property shall be moved and stored with proper contractual
authority, adequate protection, appropriate documentation, and prompt record updates.
Movement
Timely record updates shall be performed for items being moved to ensure the property locator
system's integrity is maintained. Whenever practical, GP/CP movements are accomplished using
automated integrated processes, scanning devices, email notification/ confirmation, and/or
authorized documentation to effect the relocation of hardware and system update. Campus-
specific work instructions may delineate additional move documents.
Storage
The Business Unit (BU) campuses shall allocate adequate storage space or areas for the GP/CP in
its possession. Also, these designated storage areas shall provide sufficient protection and control
of the property so long as it remains within the BU.
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Classified or sensitive property shall be stored in a protected, locked, or secured area, in
accordance with the security requirements of the contract and the BU Security Administration,
Command Media J100-J899 series documents and/or campus-specific Security procedures.
Protection of property in storage shall include, but not be limited to, security from the
elementsi.e.; water, temperature, humidity, dust, insects, and rodents. Also, any special
requirements for classified property, sensitive property, and/or limited shelf life shall be
implemented. “Storage” at the BU campuses shall be established in officially
designated storerooms, tool cribs, laboratories, and warehouses. This does not include cabinets or
rooms in production areas for accumulation or temporary storage of active tooling, test
equipment, or materials.
Storage areas shall be kept in a clean, neat, and orderly condition at all times. Special care shall
be taken to identify and eliminate fire hazards, pallet overhang, and other practices that could lead
to property damage and/or personal injury.
Justification for storage may be for one of the following reasons:
• Temporary storage for an active contract or anticipated follow-on.
• Re-procurement requirements.
• Awaiting disposition instructions or plant clearance initiatives.
GP/CP shall be segregated and kept physically separate from contractor-owned property.
However, there will be occasions where commingling of property would be advantageous to
the government. Commingling may be allowed in the following cases:
• When approved by the government’s Property Administrator in connection with
research and development contracts.
• When material is included in a multi-contract cost and material control system.
• When scrap of a uniform nature is produced from both government-owned and
BU-owned material and physical segregation is impracticable.
• When scrap produced from government-owned material is insignificant in
consideration of the cost of segregation and control.
When government contracts involved are fixed-price and provide for the retention of the scrap by
the BU.
Classified or Sensitive Property Storage

Classified and/or sensitive property shall be stored in accordance with the contract, local
security procedures, and applicable program directives. Storerooms and storage areas allocated
for the storage of classified items shall be clearly identified as “Closed Areas” and conform to
existing regulations and directives, as applicable. These areas shall be adequately secured and
accessible only to authorized personnel.
Consumption
Consumption is the process of incorporating material into an end item or otherwise consuming it
in the performance of the contract. Issuance from stock shall be controlled via an effective
system that ensures materials and expendable tools are issued to authorized personnel. Efficient
storeroom management shall consider factors such as shelf life, FIFO (first in first out), attrition,
and sensitive and/or hazardous material constraints. The system shall maintain an audit trail
37
reflecting the appropriate consumption of property. Provisions shall be made to return unused
stock to stock.
Utilization
GP/CP whether furnished or acquired by the BU on behalf of the government or customer, shall
only be used for the purpose for which it was acquired or as authorized. Property shall not be
modified or cannibalized without specific authorization from the owning agency unless such
modification or cannibalization is in accordance with the contract terms and conditions, delivery
of a contract line item, or when affecting repairs for similar units under a depot contract for a
specific customer.
Inputs/ Outputs
Inputs Outputs
• Form, Government Property • System of Record updated
Transfer Pass
• Material Traveler
• Movement Request Order
• Storeroom requisitions
• Storeroom returns
• WIP form
• DD Form 1149
• Vendor Move Order
Procedure
responsible.
All Personnel
1. Employ appropriate material handling practices, inclusive of adequate packaging to

protect the item during physical movement to preclude/minimize injury to personnel,
damage and/or loss of property.
2. Use campus forms for movement, storage and consumption, as required. Use of
automated or integrated controls shall take precedence for internal movements, and use
of email and/or other auditable electronic methods for addressing/confirming
movement of hardware between the Property Management Office (PMO) and
custodians shall be used whenever practical.
3. Contact campus the PMO Administrator for clarification when uncertain whether
existing property is authorized for use on a contract they are working and complete
Form, Request for Use of Government Property/Tooling, as required or email the PMO
with pertinent information.
38
PMO
4. Confirms whether use is authorized and respond to the requesting party or take
action accordingly.
PMO or Designee
5. Oversees and monitors overall systems of record to ensure that property locations are
updated within a reasonable timeframe. When applicable, directly updates locations as
a result of movement, transfer or inventory actions. As required, investigates
discrepancies between property moved versus property received, and implements
process improvements as necessary.
6. Uses automated integrated processes, Government Property Transfer Pass (GPTP), or
campus equivalent, to relocate property among general locations within the campus.
7. Coordinates movements of property between company campuses, business areas, and
subcontractor facilities, as required.
8. Annotates system of record and/or maintains a file on non-conforming property,
material or product in the storeroom/ storage area.
9. Notifies the customer of the discrepancy through contractual channels, as required, and
the furnished property will be returned, modified, reworked or disposed in
accordance with customer direction.
10. Returns contractor acquired property (CAP), when appropriate, to the supplier/
vendor per campus procurement protocol.
Warehouse/ Storage Operations
11. Release non-conforming property, material or product to Manufacturing,

Engineering, or Operations under the guidance of Program Mission Assurance.
12. Forward measurement equipment, including Special Test Equipment (STE) or Factory
Test Equipment (FTE) that is out of calibration or ahs an out of service tag, to
the campus Calibration Lab to be recalibrated prior to its use in qualifying product.
13. Store and process completed product (shipped in place, awaiting amended shipping
instructions) without opening the carton/ container. These assets shall be documented
on BU Form, International Invoice or Shipper (ITAR), DD Form 250, Material
Inspection and Receiving Report, or FAA 256, Inspection Report of Material and/or
Services.
14. As directed by the Program Office, ensure that certain cartons/ containers, e.g.
hermetically sealed commodities are not opened until items are needed.
15. Use automated integrated processes or DD Form 1149, Requisition and
Invoice/Shipping Document, to relocate property to other BU campuses, off site
locations, suppliers, and internal movements at the discretion of the assigned PMO
Administrator. DD Form 1149 used for movements shall be annotated with the word
39
"movement" in the upper left corner of the form. The appropriate blocks of the form
shall be completed in accordance with the instructions outlined in Work Instruction,
Shipments/Transfers of Government or Customer Property, or campus equivalent.
16. Coordinate emails between custodians and the PMO outlining the complete
description (part number, serial number, identification number, etc.) of the GP/CP
being moved and the location moved to.
17. Limit access to storage areas to authorized personnel onlyand ensure it is
adequately protected and properly secured or locked when not in use or when the
designated storekeeper is not on duty.
Limited Access Areas
18. Post a current listing of personnel authorized to be in that area without an escort;
otherwise escorts all parties not on the current access list when visiting the
specific area.
PMO or Designee
19. Oversees or maintains adequate storage space for property not currently being
used by functional personnel and those items identified as recommended scrap and
excess to current contractual requirements.
20. Stores property to preclude damage and/or deterioration. Regardless of the type of
storage utilized, either exposed or covered, the items of property shall, when required,
be suitably prepared and packaged against the elements.
21. Provides oversight of storage areas and conducts periodic reviews of
warehouse operations in accordance with Work Instruction, Government/Customer
Property (GP/CP) Idle Asset Review, as required.
Property Custodian or Recipient
22. Initiates the movement process by preparing or obtaining move documents, ensuring
that the property is properly packaged and adequately protected prior to movement.
When sending excess property to the warehouse, completes BU Form, Request for
Disposition/Storage of Government Property, or campus equivalent.
23. Ensures that sensitive property is handled in accordance with the
program/contract and campus requirements regarding security classification and/or
time-sensitive, temperature-sensitive, or hazardous material.
24. Ensures that appropriate move documents with authorized signatures, when
applicable, are placed with the property to be moved and arranges pick up of the items
to be moved through appropriate personnel.
25. Verifies that all property represented on the move document(s) has been
physically moved/received in a reasonable timeframe and assists with the resolution of
discrepancies affecting the movement and/or receipt of property.
40
26. Verifies receipt of property, completes the appropriate ‘received by’ portion of the
movement documentation, and returns required copies or provides feedback to the
campus PMO, when required.
27. Assesses records, identification, maintenance, and utilization as required by campus
PMO Management with the use of BU Form, Property Assessment Checklist, or
campus equivalent. Sample size and frequency shall be determined by the campus
PMO.
Operations, Manufacturing and Engineering
28. Assists Proposal Manager or Program Manager in defining required GP/CP to execute
the contract.
29. Maintains adequate storage space, such as storerooms and tool cribs to facilitate
the proper control and protection of property in their possession.
30. Maintains procedures and records for requesting and returning materials and/or
tools to stock for appropriate credit, provides adequate controls for maintaining
authorized accessibility, and an audit trail.
31. Ensures that property is consumed or used as authorized by the contract unless
otherwise approved by the owning agency.
32. Ensures that material is consumed at reasonable quantities when compared to
requirements such as a bill of material, requirements lists, or established scrap rates.
33. Provides material consumption reports to internal and external customers, as required.
Repair Operations
34. Monitors and ensures depot repair exchanges are accomplished in the most efficient
manner without compromising product integrity while meeting contractual obligations.
Programs, Repair/Manufacturing Operations, Mission Assurance, and Configuration
Control personnel shall ensure exchanges are authorized.
35. Maintains procedures and records for requesting and returning customer lay- in
material and provides adequate controls for maintaining authorized accessibility and an
audit trail.
36. Ensures that property is recovered in those instances as authorized by the customer
to effect item repair, rework, or cannibalization to extend the life of certain
commodities.
Program Manager or Designee

37. Identifies required property to complete contract and as necessary
coordinates with the PMO, Contracts, and other departments to ensure property is
delineated in the contract/proposal and is used as authorized.
41
Contracts Representative
38. Addresses GP/CP issues with the customer as required.

39. Requests rent-free non-interference use or transfer of existing property during the
proposal phase (prior to contract award) or in accordance with Procedure, Letters to
Contracting Officers Concerning Government or Customer Property.
40. Assists the PMO Administrator and the Program Manager, when required in
establishing rent for GP/CP and provides appropriate credit or remittance.
Calibration
41. Controls property while it is in the calibration cycle, which would include
movements to and from the Calibration Lab and outsourced services.
Procurement, Supply Chain Management (SCM)
42. Acquires authorization for use, initiates and coordinates movement of property
between business areas, and subcontractor facilities. As required, assists with
resolving discrepancies between property moved versus property received and
implements process improvements, as necessary.
References
Procedures Letters to Contracting Officers Concerning Government or Customer
Property
Security Series/ Requirements
Corporate Property Management Plan
Work Instruction, Shipments/ Transfers of Government or Customer
Property
Work Instruction, Government/ Customer Property (GP/CP) Idle Asset
Review
Forms DD Form 1149, Requisition and Invoice/Shipping Document DD
Form 250, Material Inspection and Receiving Report
BU Form, Vendor Move Order
BU Form, Government Property Transfer Pass
BU Form, Request for Disposition/Storage of Government Property
BU Form, Request for Use of Government Property/Tooling
BU Form, Property Assessment Checklist
BU Form, International Invoice or Shipper (ITAR)
Outcome 9 – Property Maintenance

42
This procedure explains the requirements and outlines the responsibilities and process for
implementing a maintenance program that will assist the Business Unit (BU) in maintaining
government/customer property (GP/CP) while meeting contract objectives.
The target audience for this procedure is the BU and subcontractor personnel in the
possession of GP/CP.
Requirements
The BU shall provide a maintenance program designed to the degree necessary to ensure the
optimum useful life of property in its possession in accordance with Corporate Property
Management Plan, Federal Acquisition Regulations (FAR) 52.245-1 (f)(1)(ix) Maintenance, and
Acquisition Management System (AMS) 3.10.3-11, Contractor’s Maintenance Program, and/or
the contract. Maintenance, however, is not required for items being processed for disposal.
The maintenance program shall include the determination of the need for, and performance of,
maintenance, rehabilitation, and the recording of work accomplished.
The following major activities shall be included in the development of a maintenance
program:
• Determining maintenance requirements (contractual requirements shall be
observed).
• Establishing minimum maintenance standards and specifying maintenance manuals
and procedures.
• Documenting maintenance requirements, including the specifications of which
maintenance manuals/procedures shall be included.
• Special provisions for the maintenance of hazardous equipment or facilities (as
applicable).
• Incorporating the requirement for a maintenance program in all subcontractor property
control systems.
• Disclose and report the need for replacement and/or capital type rehabilitation to the
customer representative or Property Administrator.
The BU shall maintain all GP/CP with the following objectives in mind:
• Eliminate or limit damage to GP/CP and/or BU product.
• Promote maximum useful life for GP/CP.
• Ensure the property completely conforms to the applicable drawings,
specifications, or contract requirements.
• Promote engineering support for maintaining GP/CP.
• Reduce emergency repairs and equipment downtime.
• Prompt correction of equipment deficiencies when noted and timely response to
breakdown situations.
• Record accurate costs/man hours for services rendered.
43
Preventive Maintenance
Preventive maintenance (including calibration, routine or scheduled servicing and minor
adjustments) shall occur on a periodic basis that would include such tasks as adjustments,
lubrication, filter cleaning/ replacement, calibration, etc., to ensure assets remain in a state of
readiness.
Preventive maintenance or calibration (the planned inspection, adjustment, and parts replacement
routinely performed on applicable equipment) shall be accomplished on a
predetermined cycle, and ensure that property remains in an operating condition while
minimizing downtime and/or emergency repairs. Assets that have been placed in storage are
exempt from preventive maintenance actions unless otherwise directed by the owning agency or
specifically required. When GP/CP is recalled from storage it shall be evaluated and
maintained as necessary to ensure the property still completely conforms to the applicable
drawings, specifications, or contract requirements. The level of preventive maintenance is based
on the contract requirements and the applicable maintenance program.
Procedures: Metrology Management System and Organizational Responsibilities for Monitoring
/Measuring Equipment (M&TE), or campus equivalent documents provide direction for ensuring
that items are calibrated and in serviceable condition.
Corrective Maintenance
Corrective maintenance (including repairs, emergency repairs and/or capital type rehabilitation),
or those actions required that fall outside the scope of the preventive maintenance program, is
normally associated with equipment malfunction, breakdown, or its failure to perform up to
established standards. These actions are taken when a random failure or an equipment defect
occurs. Corrective maintenance actions or minor repairs shall be accomplished in accordance
with the contract, as applicable or the campus cost and disclosure statement and shall be
disclosed to the owning agency/customer when customer funding is required to accomplish such
maintenance.
Capital-Type Rehabilitation
Capital type rehabilitation of GP/CP is maintenance that exceeds the normal maintenance
agreement in effect between BU and the customer. The Contract Administration office
responsible for the CP/CP shall confirm that the work to be performed is outside the scope of the
normal maintenance, and shall provide approval prior to expending contract funds for materials
and labor for its restoration. A capital type rehabilitation shall be defined within department
procedures or addressed for each occurrence and justified by engineering analysis/rationale.
Notification of a capital type rehabilitation shall include, at a minimum, the components
requiring replacement and an estimate or aggregate cost for both labor and materials to
accomplish the restoration.
44
Inputs/ Outputs
Inputs Outputs
• List of GP/CP to be maintained • Record of failure identification
• Contract-based protocol for • Program Management’s
handling preventative assessment to follow through
maintenance, failures and with any repair action
repair (including reporting • Record of maintenance actions
requirements, maintenance
• Calibration records
training, maintenance
documents and procedures, • Contracts Letter seeking
maintenance tools, and spares contract funds, spares, technical
assistance, and/or authorization
• Schedule for preventative
to repair (if required by
maintenance, calibration, and
contract)
periodic replacement
• Customer approval for repair
• GP/CP failure to perform up to
action
established standards
45
Proced
ure
Organizational titles and responsibilities may vary among BU campuses. Therefore, when
specific job title is referenced in this procedure, campus personnel having similar job
responsibilities shall be responsible for the activity.
1. With the assistance of other functional departments, surveys the condition of GP/CP.
During these reviews, ensures that maintenance actions are evident to ensure that
the property is being properly maintained.
Program Management or Designee
2. Ensures that a maintenance plan is established.
Calibration, Instruments, Metrology and Test
3. Determines prime users of the property. Prime users or a custodian are responsible for
preventive maintenance of property. Establishes recall system for periodic
calibration.
4. Performs record maintenance to property requiring calibration as well as addresses
any deficiencies found as a result of periodic inspections.
5. Collaborates with the Program Office and the PMO to temporarily remedy equipment
failures with company resources or other customer property as authorized.
Prime Users or Property Custodians
6. Verifies, when applicable, that all monitoring and measuring devices are uniquely
identified to the calibration recall process and are labeled with calibration due
date or as required per Procedure, Organizational Responsibilities for Monitoring
/Measuring Equipment (M&TE).
7. Requests Preventive Maintenance (PM) instructions from:
• Vendor (training materials and/or operational manuals).
• Calibration and Metrology.
8. Periodically inspects equipment and tooling and:
• Lubricates bearings and moving parts, as required.
• Adjusts, repairs, or replaces worn or damaged parts to eliminate causes of
deterioration.
46
• Removes sludge, chips, cuttings, and oils from equipment.
9. Forestalls deterioration caused by contamination, corrosion, and other substances.
10. Records PM accomplished, documents actions and/or reports to Calibration and
Metrology, as necessary.
Capital-Type Rehabilitation
Prime Users or Property Custodians

11. Identifies inoperative or failed equipment in accordance with BU Form, Action
Required Tag (ART), or campus equivalent.
12. If the failed equipment causes work stoppage, notifies Area Supervision and the
Program Office. Provides a copy the ART or campus equivalent to the Program
Office representative, the campus PMO and Sector GP focal point, as appropriate.
13. Discloses to Program Management and/or Contracts the need for major repair,
replacement, and other capital type rehabilitation work to be accomplished. Reports
all such instances to Calibration and Metrology and the site PMO, as required.
Contracts
14. Determines if the contract has an established protocol, call order, or a contract line
item (CLIN) for handling specific failures and, if so, advises Programs to initiate
repair, as required.
15. Discloses and reports to the Contracting Officer, Buyer, or customer the need for
repair, replacement, and/or capital type rehabilitation of equipment as required in
accordance with Procedure, Letters to Contracting Officers Concerning Government
or Customer Property.
Program Management, Contracts, Operations, PMO

16. Affects equipment repair or refurbishment as authorized.
17. Ensures repair actions are accomplished and documented in accordance with
established procedures, program directives, quality requirements and/or work
instructions.
Program Management
18. Assesses and follows through with repair action considering the overall repair
costs and the following parameters: Beyond Economical Repair (BER) or Beyond
Physical Repair (BPR). BER for the purposes of this procedure is defined as
60% of the item’s acquisition value unless otherwise stipulated in the contract.
Customer replacement of BER and BPR items may need to be pursued to complete
the contract.
19. Develops a contingency plan based on the rendered business decision and/or
47
impact to the program to remedy the failure in the event the owning agency/customer
is slow to respond to funding requests.
20. Ensures that the repair of GP/CP does not impact the schedule or cost of the
contract utilizing such property. In the event this occurs, notifies the Contracting
Officer/Buyer immediately in order to mitigate the impact. An equitable adjustment
may be required subsequently in accordance with the changes clause of the
contract or other similar terms.
21. Authorizes repair in accordance with Cost and Disclosure statement and
Program Finance, per the contract or subsequent Procuring Contracting Officer
(PCO)/ Administrative Contracting Officer (ACO), or Buyer authorization.
References
Procedures Corporate Property Management Plan
Property
Calibration Series
Metrology Management System
Organizational Responsibilities for Monitoring/ Measuring Test Equipment
(M&TE)
Forms BU Form, Action Required Tag (ART)
Other AMS 3.10.3-11, Contractor’s Maintenance Plan
FAR 52.245-1 (f)(1)(ix), Maintenance
Outcome 10 – Government/ Customer Property (GP/CP) Contract

Closure

This procedure documents the assignment of responsibilities and steps performed to initiate
disposal of remaining GP/CP, close-out property records, and provide guidance to
personnel on properly closing out the property element of a contract.
The target audience for this procedure is all employees that have the responsibility to
account for GP/CP.
Requirem
ents
The Property Management Office (PMO) shall conduct property actions associated with
contract closeout. Property closeout actions shall occur in accordance with Federal
Acquisition Regulations (FAR) 52.245-1(f)(1)(x), Property Closeout, or Federal Aviation
Administration (FAA) Acquisition Management System (AMS) 3.10.3, FAA Acquisition
Management System (AMS), or applicable National Aeronautics and Space Administration
(NASA) Supplement to the FAR Supplement (NFS) 1845.72 sub- clauses. Upon
48
notification from Contracts of contract completion or termination, the following actions
shall be promptly performed:
• Physically inventory all property sufficient for disposal purposes unless waived by
the Customer.
• Investigate, report, and resolve property loss which may include: damage,
destruction or theft. A summary report listing all property below the established
capital threshold not located shall be provided.
• Report excess/residual GP/CP. Excess/residual property shall not be reported
when contractual disposal instructions exist.
• Comply with disposal instructions.
Submit property closeout
certification.
Inputs/ Outputs
Inputs Outputs
• Property Listings • Property Reports
• Subcontractor/Alternate Site • Subcontract/Alternate Site
Property Listings Property Reports
• Systems of Record Property • Systems of Record Property
Listings Reports
• Unique Identifier (UID) Registry
Property Reports
• DD Form 1662 or equivalent
• NASA Form 1018, NASA Property in
the Custody of Contractors
• Loss Reports
Procedure
PMO or Designated Personnel

1. Initiates a final inventory, adequate for disposal purposes, of all remaining
GP/CP in accordance with Outcome 4, Government/ Customer Property Inventory,
and/or applicable campus instructions.
2. Coordinates the transfer and/or disposal of any remaining GP/CP located at the
Business Unit (BU) and/or subcontractor/alternate campuses with Programs,
Contracts, Buyer or Subcontracts Administrator, as required.
3. Ensures official records of accountability have been reduced to a zero balance.
4. Ensures disposition of all GP/CP has been accomplished as directed by the
Contracting Officer (CO)/ Customer representative or Plant Clearance Officer
(PLCO).
5. Ensures there are no liability determinations pending against the BU or its
subcontractor(s) due to pending Loss reports.
49
6. Ensures all GP/CP provided for use on the contract and/or subcontract(s) has been
returned in the same condition as when provided. Except to the extent that such
property was reasonably consumed or expended in the normal performance
of the contract and/or subcontract(s).
7. Ensures there are no open charges against the contract for other property transactions,
such as sales, transfers or scrap credits of GP/CP.
PMO, Contracts Representative or Designated Personnel
8. Monitor other mechanisms in order to initiate contract closure and a final physical
inventory, which include:
• Approaching the end of the contract performance period.
• A "Z" DD Form 250, Material Inspection and Receiving Report, indicating
the last delivery has been made.
• There is no assigned property (a zero balance property financial account).
• A request for contract closure is received from the Administrative Office
(AO) Property Administrator or Government Liaison Office.
• A request for contract closure is received from another Customer.
• Notification of closed projects is received from Contracts or Finance.
9. Review the contract, statement of work (SOW), applicable appendices, and/or other
bilateral documents that may provide disposition instructions. Disposal direction
from any of the above sources shall be the primary course of action, unless
otherwise directed by or through the Contracts Representative.
10. When direction provided in the above documents are vague, incomplete,
unreasonable, or uneconomical, consult with the PMO or the assigned Contracts
Representative and address alternatives. Alternatives shall be evaluated and
communicated to the Contracting Officer (CO)/Buyer, the AO Property
Administrator, or the designated customer representative.
11. Address any special contractual provisions relative to property matters prior to
certifying a contract. Disposition of all property, including a decision relative to
acquired/fabricated tooling in accordance with FAR 52.245-17, Special Tooling, or
similar language should be addressed prior to closing the property records.
12. Accelerate the disposal activity, whenever possible, in order to accommodate
timely closure or certification of a contract. Efforts to dispose of the remaining
assets should be given prompt attention and, if necessary, the required follow- up.
13. Disposes of declared excess and scrap throughout the life of the contract, and all
property will be properly disposed of before the closure of the property records.
Program Management (PM) or Designee
14. Directs and/or coordinates disposal of excess property and/or customer owned
50
material with the functional departments and the PMO during contract performance.
At minimum, 90 days prior to the period of performance (POP) end date determines
whether any or all of the existing property will be required for current or future
business and seek contractual authority to retain/transfer.
15. Screens the residual property and/or material for use on active or anticipated
follow-on government contracts.
16. Submits all requests for retention and/or recommendations regarding the future
utility of the residual property to Contracts Representative and/or the PMO
representative.
Material Requirements Planning (MRP)
17. Once Contractor Acquired Material (CAM) is identified as excess to the contract in
which it was acquired, it may be reallocated at cost to other contracts as long as no
customer restrictions have been identified; reference Procedure, Material Transfers,
Financial Ownership. If excess CAM is restricted as directed by the customer
Material Requirements Planning (MPR), will coordinate the receipt of contractual
authority via the Contracts Representative prior to reallocating any desired material
accountable to the respective contract(s).
18. Purges existing storerooms of any residual inventory accountable to the contract in
accordance with the title provisions of the contract or as directed by the PMO.
PMO, PM, Business Management and Operations Planning and Control
19. In parallel with contract closure actions and when residual CAM is recognized, the
BU evaluates the level of effort required to process same for disposal
purposes. When CAM has a recorded cumulative value of $1,000 or less, the BU
may elect to provide appropriate credit and move the material to a BU titled account
(option c below) based on the rendered business decision. Regardless of value,
residual CAM will be processed utilizing one or more of the following options:
a. Transfer at costs to other contract(s) – this action may require notification to
the Contracting Officer (CO)/ Customer representative.
b. Transfer material at no costs to a follow-on effort (note: post transfer material
will be electronically segregated and managed as government furnished
material (GFM) – this action will require CO/ Customer representative
authorization.
c. Credit the contract and transfer material to a BU Owned Inventory Group
(Material Management Accounting System (MMAS) protocol) – this action
prompted based on the probability that the majority of the CAM will be
reutilized per MRP analysis, or
d. Process residual in accordance with Plant Clearance process. A combination
of the above options may be pursued with the ultimate goal of efficiently
disposing the material and providing the customer with appropriate credit,
when applicable.
51
Contracts Representative or Designated Personnel
20. Flows down the requirements to initiate contract closure to all the functional
departments, including the PMO, when a contract is completed or terminated in
accordance with Procedures:, ‘Contract Closeout’ and ‘Termination of U.S.
Government Contracts’, and/or campus documents.
21. Seeks authorization to return, repair under separate contract or contract line item
number (CLIN) or dispose of beyond economical repair (BER) or beyond
physical repair (BPR) items from the customer in accordance with Procedure, Letters
to Contracting Officers Concerning Government or Customer Property.
22. Requests CO/ Customer representative authorization to transfer remaining
property and/or residual material to active government contracts, when
applicable.
23. Provides government/customer disposition instructions or clarification to existing
instructions for GP/CP, as required.
References
Procedures Contract Closeout
Termination of U.S. Government Contracts
Property
Material Transfer, Financial Ownership
Outcome 4, Government/Customer Property Inventory
Forms DD Form 1662, DoD Property in the Custody of Contractors
Other FAR 52.245-1(f)(1)(x), Property Closeout
52

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Lesson 2

Contractor Property Management System Requirements

Government Property Management

Purpose/ Target Audience

An effective Property Management system encompasses at minimum three resources:

Property Management Office (PMO)

1. Develops and maintains procedures and work instructions and

4. Establishes property administration of a contract when:

5. Maintains proper controls and protection for equipment/ material in their

Outcome 1 – Government Property Acquisition

Individuals involved in the acquisition of Government-Furnished Property (GFP) and Contractor

The target audience for this procedure is all employees.

GP/ CP Program Execution

Property Management Office (PMO)

1. Provides oversight of the acquisition process and guidance to Contracts,

PMO and Departments Requiring Government Furnished Property

Proposal/ Program Manager

8. Determines whether GP or CP is required and, in doing so, reviews existing

Contracts Representative (CR)

Operations, Manufacturing and Engineering

Process I Contractual Flowdown

1. Flow down of Contract Provisions

Process II Government Furnished Property (GFP)

1. Contracts department obtains contractual coverage for Government Furnished Property

Process III Contractor Acquired Property (CAP)

Process V Transfer of Government Property from Other Government Contracts

Purpose/ Target Audience

3) Obtain copies of receiving and fabrication documents (e.g., receiving

b. The Program Manager or Supervisor shall:

2) Ensure appropriate tag has been placed on the property.

2. Types of Property Identification

b. The following types of property shall be identified:

2) Special Test Equipment (STE) systems and removable components.

3) Plant Equipment (PE).

4) Government Furnished Property (GFP)

5) Leased property accountable to a government contract.

3. Exceptions to Tagging Requirements

5) Computer monitors received for Information Technology will be identified with

Purpose/ Target Audience

In accordance with contract provisions, FAR 52.245-1(f)(1)(iii), Records. The BU Property

PMO or Designated Personnel

PMO and/or Repair Operations

Engineering, Manufacturing Operations

Outcome 4 – Physical Inventory

Property Management Office (PMO) or Designated Personnel

1. Schedules periodic inventories at the beginning of each calendar year.

Program Management, Area Management or Property Custodian

Outcome 5 – Subcontractor and Alternate Site Government/ Customer

Purpose/ Target Audience

Procurement or Subcontracts Management

Business Unit, Supply Chain Management (SCM)

9. Upon supplier notification of debarment, suspension, insolvency, bankruptcy or

PMO, Inventory Coordinator (IC) or Designated Personnel

• File - site surveys, certifications/inventory report, correspondence,

• Non-responsiveness to contract provisions.

SCM Personnel/ Subcontracts

19. Issues written notification to the subcontractor or alternate site directing a

PMO, IC or Designated personnel

IND 205 L-2 Contractor's PMS Procedures

IND 205 L-2 Contractor's PMS Procedures

IND 205 L-2 Contractor's PMS Procedures