[Code of Federal Regulations]
[Title 48, Volume 1]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 48CFR45]

[Page 835]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                CHAPTER 1--FEDERAL ACQUISITION REGULATION
 
PART 45--GOVERNMENT PROPERTY--Table of Contents
 
  Subpart 45.6--Reporting, Redistribution, and Disposal of Contractor 
                                Inventory
 
45.605-1  Purchase or retention at cost.

    (a) The plant clearance officer shall encourage contractors to 
purchase or retain contractor-acquired property at cost. However, the 
contractor shall not include any part of the cost of property purchased 
or retained in any claim for reimbursement against the Government. Under 
cost-reimbursement contracts, appropriate adjustments shall be made for 
previously reimbursed costs. When the property is for use on a 
continuing Government contract or commercial operation, handling and 
transportation charges may be considered an allowable cost (included in 
the contractor's settlement proposal as other costs in the case of a 
termination), provided that the charges are reasonable.
    (b) If a contractor purchases or retains contractor inventory for 
use on a continuing Government contract that is subsequently terminated, 
the property shall be allocated to the continuing contract, even though 
its purchase would otherwise constitute undue anticipation of production 
schedules. If, as a result of the purchase or retention of property from 
a terminated contract for use on other Government contracts, the 
contractor terminates subcontracts under the other Government contracts, 
reasonable termination charges of the subcontracts may be included as an 
allocable cost under the contract that generated the excess property.