D. Definition of "Estimated Harm"/"Acquisition Cost"

Comment: One respondent recommended adding a new definition of "estimated harm'' to the proposed clause at 252.245-70XX and stated that estimated harm should consider other factors such as residual value, replacement cost, and care and handling cost. The respondent stated that the estimated harm should be expressed as a numeric value, and that providing only the acquisition cost without providing estimated harm to the Government is misleading and may result in poor decisions. According to the respondent, industry experience has proven that there typically is minimal or no harm to the Government and, even though the Government is self insured, replacement of lost items rarely occurs.

Similarly, a respondent stated the need to address the materiality of the loss and that without this information, decision makers may be misled and losses may be overstated. Further, according to the respondent, the rule should then explain how to compensate the Government for losses when the "indirect costs used to buy the property" have been partially allocated to Government contracts and partially allocated to commercial work or firm-fixed-price contracts.

DoD Response: These recommen da tions are outside the scope of the rule. The clause seeks only to require the electronic reporting of data pertaining to Government property losses. It does not require reporting of the estimated harm or materiality of such losses to the Government.

However, in order to clarify the reporting value, the clause definition of "acquisition cost" has been revised to a definition of "unit acquisition cost." The new definition clarifies that for Government-furnished property, the unit acquisition cost is the dollar value assigned by the Government and identified in the contract; and adds the method for determining the reporting value for contractor-acquired property. The revised definition is more comprehensive and clarifies the property values to be reported.

The final rule also revises paragraph (b)(4) of the clause to remove the references to 52.245-1 and 52.245-2, since the contract may contain other liability or other reporting requirements. This change clarifies that the new clause does not impact any other contractual reporting or liability requirements.