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  • Question

    1) Should these cost be identified as Acquistion O&M cost in the APB? 2) If so, should Acquisition O&M cost be included Program Acquisition Unit Cost (PAUC)?


    Answer

    How to allocate and report costs can sometimes be difficult because  many of our programs are in multiple phases of acquisition simultaneously. Here are some guidelines:

    1)  The program acquisition cost (PAUC) is one of the major factors of
    the APB and is always reported (10 USC 2432).  The PAUC is defined as the total cost for development, procurement, and system-specific military construction divided by the number of fully-configured end items to be produced for the acquisition program. 
    2)  Report only Operations and maintenance (O&M) costs that support the production and deployment phase, as well as acquisition related (O&M), if any (Defense Acquisition Guidebook (2.1.1.4)|
     
     
    3)  O&M funds used for recapitalization or post production engineering may or may not be included in the APB based on their intended purpose.  Ifused to upgrade capability, then they should have been anticipated and included in the baseline.  Sometimes, O&M funds are used to make changes to for form, fit, and, function changes that have a secondary affect of improving performance.  These types form, fit, and function changes that have a secondary affect on improving performance should not be included in the APB. .   
     

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