Please take a look at the DCMA Manual 2101-02 Payments, Section at https://www.dcma.mil/Portals/31/Documents/Policy/DCMA-MAN-2101-02.pdf?ver=2019-02-20-154800-810d. SECTION 12: PAYMENT TERMS INCENTIVE CONTRACTS provides detailed discussion regarding your question. 12.2. FIXED PRICE INCENTIVE (FPI) CONTRACTS REVIEW OF QUARTERLY LIMITATION OF PAYMENT (QLOP). a. The purpose of a QLOP is to reclaim overpayments by the Government in situations of cost under-run. (1) Functional Specialist must analyze the QLOPs to identify trends or problem areas reflected in the estimates for effort to be completed in prospective periods of performance. (2) Value and length of performance will have an impact on the funding provided in the contract. (3) Generally, large complex incentive contracts will be incrementally funded. While this permits flexibility for the Government, it may have an impact on Contractor plans for performance. (4) Status of the Contractor’s accounting system and estimating system may impact the financial status of the FPI contract. DCMA-MAN 2101-02, February 14, 2019 Section 12: Payment Terms Incentive Contracts 67 (5) QLOPs must be cumulative from the beginning of the contract and include:– (a) Total contract price of all supplies delivered (or services performed) and accepted by the Government. (b) Total costs (estimated to the extent necessary) reasonably incurred. (c) Portion of the total target profit that is in direct proportion to the supplies delivered (or services performed) and accepted by the Government. (d) Total amount of all invoices or vouchers for supplies delivered (or services performed) and accepted by the Government. b. If the contract contains one or more CLINs that are the FPI contract type, the QLOP would be submitted for that individual CLIN, not the entire contract.