1.1.3.  Review contract funds status as soon as the contract becomes physically complete and notify the buying activity of any excess funds the contract administration office may be able to deobligate.

            1.1.3.1.  Early identification of excess funds may help ease funding constraints imposed on the Services and enable buying activities to use funds that have not expired for obligation or cancelled for other requirements, in accordance with financial laws and regulations.
            1.1.3.2.  When identifying excess funds, the ACO shall consider the type of contract and clauses and determine the reason for the excess funds (e.g., if indirect rates have not been settled for a cost reimbursement type contract, the ACO should retain enough funding to make payment on the final voucher).  For additional instruction regarding excess funds at the time of final payment (see paragraphs 2.3.2.4. and 2.4.6. below).

        1.1.4.  Identify the necessary closeout actions to be taken using the DD Form 1597, Contract Closeout Check List, (or Agency equivalent) for contracts valued above the simplified acquisition threshold (DFARS PGI 204.804-1(2)). 

            1.1.4.1.  For contracts administered in MOCAS, the MOCAS Contract Closeout (MCC) eTool automatically generates a check list for physically complete contracts.  As closeout actions are completed and recorded in MOCAS, the MCC check list is automatically updated (see MCC eTool Computer Based Training).
            1.1.4.2.  MCC streamlines the closeout process by reducing the number of screens the user navigates in order to close a contract.  It allows functional specialists to track the closeout process, generates a current closeout check list, permits the user to update R2 overage reason codes, and generate and process Final Pay NLAs. 
            1.1.4.3.  Functional specialists shall use MCC to track/record closeout actions on the check list, update R2 overage reason codes, and generate/process Final Pay NLAs for fixed price contracts administered in MOCAS, with the exception of ODOs (see paragraph 4 of this Instruction). 
            1.1.4.4.  Functional specialists shall use MCC to track/record closeout actions on the check list and update R2 reason codes for cost-reimbursement contracts administered in MOCAS, with the exception of ODOs (see paragraph 4 of this Instruction). 

2.  Perform Closeout Actions 

     2.1.  (ND)  Using the Contract Closeout Check List as a guide to ensure all closeout actions have been satisfactorily accomplished, functional specialists shall begin taking applicable actions to close the contract.  As detailed below, all actions identified in the check list may not be applicable to every contract type.
     2.2.   ALL CONTRACTS.  Actions that may be applicable to all contracts, depending on the terms and conditions of the contract include:

        2.2.1.  Classified Material.  (ND)  When the contract is classified or contains requirements for handling classified documents (see contract DD Form 254, DoD Contract Security Classification Specification), the ACO shall ensure that classified material has been dispositioned in accordance with Government security regulations and accounted for by the contractor  (see DoDD 5220.22-M, National Industrial Security Program Operating Manual about disposition and retention).

            2.2.1.1.  Disposition of classified material may be considered complete when a final DD Form 254 is issued indicating disposition, or the contractor provides written certification that all data has been properly processed. 
            2.2.1.2.  Upon physical completion, the functional specialist shall prepare a DD Form 1593, marked "Information Copy,” and send it to the cognizant Industrial Security Office.  The cognizant Industrial Security Office address may be found on the contract DD Form 254.  The ACO does not need to receive confirmation or certification of completed actions from the security office in order to proceed with closeout.  When a contract with classified material is closed and a final contract completion statement has been issued, all classified material approved for retention by the contractor is under the cognizance of the PCO and the Industrial Security Office.
            2.2.1.3.  The ACO shall ensure the prime contractor has cleared all DD Forms 254 from subcontractors performing under the prime contract.

        2.2.2.  Patent Report.  When a contract contains a patent rights clause, FAR 52.227-11, 52.227-13 or DFARS 252.227-7039, the ACO shall obtain a final patent report from the contractor, as required by the clause, preferably on a DD Form 882, Report of Inventions and Subcontracts.  The report should be submitted within 3 months after physical completion of the contract.  The ACO shall forward the report to the buying activity for action. LATEST CHANGE: FAR 4.804.5(a)(2) states the final patent report should be cleared within 60 days of receipt and if patent report is not received the Contracting Officer may proceed with closeout procedures upon consultation with agency legal counsel.

            2.2.2.1.  The report should list all patent claims made under the contract or certify that there were no inventions (a negative report), and list all subcontracts which include a patents rights clause or certify that no subcontracts were issued with this requirement.
            2.2.2.2.  If the contract contains FAR 52.227-11, Patent Rights -- Ownership by the Contractor, a final patent report is required only if there is an invention.
            2.2.2.3.  If DFARS 252.227-7039, Patents--Reporting of Subject Inventions, is also in the contract, a final report is required within three (3) months after physical completion.
            2.2.2.4.  The PCO should forward the clearance request and patent report to the cognizant patent counsel for review and clearance.
            2.2.2.5.  If the final patent report is negative, the ACO may include language in a letter to the PCO, including a statement such as "if the PCO fails to issue a response within 60 days, patent clearance shall be deemed to have been issued" (see exception at paragraph 2.2.2.6. of this Instruction).  If this letter option is pursued, prior to generation of this letter, the ACO should:

                2.2.2.5.1.  Proactively verify information on the negative DD Form 882 and include the basis for the opinion (progress report, lab report, interim patent reports, comments from quality assurance specialists/program integrators, final technical report, etc.) in the request for patent clearance letter.
                2.2.2.5.2.  Document aggressive follow-up on the status of the pending request for patent clearance during the 60-day period.
                2.2.2.5.3.  If desired, include an invitation to the PCO/patent counsel to provide an opportunity for them to voice their objection to the 60-day response.

            2.2.2.6.  If the DD Form 882 contains a report of patentable subject inventions or if the ACO has reason to believe that a negative DD Form 882 has failed to disclose an invention, the ACO should not impose a 60-day suspense for a patent clearance response.  

         2.2.3.  Property Clearance.  (ND)  When a contract contains FAR 52.245-1, Government Property the functional specialist shall coordinate with the assigned Government Property Administrator (PA) to ensure Government property provided to the contractor was properly disposed.   

            2.2.3.1.  Upon completion of all contract property disposition  actions, the assigned property administrator shall initiate closeout action in CPAS, which will automatically generate the R9 code "55".

        2.2.4.  Price Revision.  When the contract contains clauses for economic price adjustments (FAR 52.216-4, Economic Price Adjustment – Labor and Material), price redetermination (FAR 52.216-6, Price Redetermination - Retroactive), or incentives (FAR 52.216-10, Incentive Fee, 52.216-16, Incentive Price Revision – Firm Target, or 52.216-17, Incentive Price Revision – Successive Targets), adjustments in price may be necessary.

            2.2.4.1.  Economic price adjustment.  The contractor shall notify the ACO within 60 days after an increase or decrease in rates of pay for labor or unit prices for material, but no later than final payment.  When an adjustment is necessary, the ACO shall negotiate a price adjustment and issue a contract modification in order to complete the action.
            2.2.4.2.  Price redetermination.  In accordance with the contract redetermination clause, the contractor shall submit a redetermination proposal within a stated number of days after delivery of all supplies and completion of all services.  The ACO shall negotiate to re-determine fair and reasonable prices and issue a contract modification to complete this action.
            2.2.4.3.  Incentives.  Contracts containing incentive clauses may be subject to submission and negotiation of cost elements that will be used in the formula for the incentive arrangement.  For an incentive contract, the ACO shall ensure that all overhead rates applicable to the contract have been negotiated and the contractor is eligible to submit its re-pricing settlement proposal.  The ACO shall issue a modification, in accordance with the contract clause, to complete this action.  

        2.2.5.  Value Engineering Change Proposal (VECP).  (ND)  When a contract contains FAR 52.248-1, Value Engineering, functional specialists shall verify that no outstanding VECPs exist.  The clause encourages the contractor to develop, prepare, and submit VECPs voluntarily.  When a contractor submits a VECP, the buying activity generally performs a review, with input from DCMA technical engineers, and makes a final decision whether or not to accept the VECP.  If accepted, the PCO will issue a modification at the conclusion of VECP negotiations.  Upon receipt of the modification or notification of non-acceptance, this action is complete.
        2.2.6.  Termination Docket.  A contract may be terminated for convenience or for default.  DCMA TCO’s settle contracts that are terminated for convenience.  The buying activity settles contracts that are terminated for default.

            2.2.6.1.  When a contract has been terminated for convenience, the Termination Contracting Officer (TCO) establishes a termination docket in the Termination Automated Management System (TAMS).  All open actions and liabilities shall be resolved by the TCO prior to closeout.  Upon execution of a settlement agreement or determination for contracts, the TCO shall issue a modification, close the termination docket and forward the file to the ACO with advice concerning excess funds, if any, for incorporation into the official contract file (EDW). 

                2.2.6.1.1.  For contracts administered in MOCAS that are being completely terminated, DFAS is responsible for moving the contract to Section 3, via Section 2, in order to generate a contract completion notice (Note:  An exception exists for terminated ODO contracts – the ACO shall move the ODO to Section 3).  When the TCO issues a settlement agreement or determination modification, the ACO should ensure that DFAS has taken action to close the contract.
                2.2.6.1.2.  For contracts administered in MOCAS that are being partially terminated for convenience, the ACO shall ensure the contract remains in Section 1 until the non-terminated portion has been completed.
                2.1.6.1.3.  Upon receipt of a no-cost termination modification for a contract administered in MOCAS, DFAS is responsible for moving the contract to Section 5.  The ACO should ensure that DFAS takes action to close the contract, which completes this action. 

            2.2.6.2.  The buying activity maintains the termination docket for contracts terminated for default.  All open actions and liabilities shall be resolved by the activity prior to closeout.   

    2.3.  Close Fixed Price Contracts.  Actions that may be applicable to fixed price type contracts, depending on the terms and conditions of the contract include:

        2.3.1.  Royalty Report.  When a contract contains FAR Clause 52.227-9, Refund of Royalties, the contract price may include certain amounts for royalties payable by the contractor or subcontractor, or both.  Before final payment can be made, the contractor shall furnish a statement of royalties paid or required to be paid in connection with performing the contract and subcontracts thereunder together with the reasons. 

            2.3.1.1.  If royalties were included in the contract price and are determined by the ACO to be properly chargeable to the Government and allocable to the contract, then the contractor will be compensated and this action is complete.   
            2.3.1.2.  If royalties were included in the contract price and were not in fact paid by the contractor or are determined by the ACO not to be properly chargeable to the Government and allocable to the contract, then the contract price shall be reduced.  Repayment or credit to the Government shall be made as the ACO directs, completing this action.

        2.3.2.  Final Payment

            2.3.2.1.  For contracts in MOCAS Part B with funding equal to or less than $25,000, when final payment is made, the contract "automatically" moves to Section 5 and then to Section 8.  When the contract enters Section 8, no further action is required by the functional specialist.
            2.3.2.2.  For contracts in MOCAS Part B with funding greater than $25,000 but not exceeding $99,000, DFAS is responsible for closing the contract within 6 months and any excess funds are deobligated automatically.  Functional specialists shall manage contracts in Part B on an exception basis.  If DFAS encounters a problem closing the contract, the functional specialist may need to assist; otherwise, DFAS is responsible for closing the contract within the 6 month time standard and ensuring the contract moves to Section 5 and then to Section 8.  When the contract enters Section 8, no further action is required by the functional specialist or DFAS.
            2.3.2.3.  (ND)  For all other MOCAS administered fixed price contracts, except ODOs (see paragraph 4 of this Instruction), the ACO shall review the contract to identify excess funds and use the MCC eTool (see MCC eTool Computer Based Training) to generate and process a Final Pay NLA, ensuring the contract moves to Section 5 and then to Section 8.  When the contract enters Section 8, no further action is required by the functional specialist or DFAS.

                2.3.2.3.1.  When the Final Pay NLA has been processed in MCC, the information is transmitted to MOCAS and an electronic contract completion statement is generated and sent to the buying activity, an R9 Remark FMNLA PROCESSED (indicating date of final payment) is generated.
               

            2.3.2.4.  Excess and Remaining Funds.  Generally fixed price contracts have an unliquidated (ULO) balance equal to $0.00 when the contract becomes physically complete.  However, there are instances where the contract allows for variances in quantity shipped, the contractor has rounded on the invoice, or performance on a specific CLIN was not necessary (e.g., fixed funds provided for maintenance or service on computer hardware).  (ND)  The functional specialist shall complete a review of funds to determine the reason why the ULO balance does not equal $0.00.  The review is conducted to determine if the funds are “excess” or “remaining” to contract requirements.  Upon completion of the review, the circumstances that caused the funds balance will dictate whether funds can be deobligated via modification or removed automatically in MOCAS via the Q-Final process (see paragraph 2.3.2.4.2. for additional information about the Q-Final process).                

                2.3.2.4.1.  Excess funds are funds relating to a specific line item or deliverable that was not performed on a contract.  (ND)  The functional specialist shall deobligate all excess funds by contract modification.  For contracts administered in the MOCAS system, the modification shall be fully processed before proceeding with the MCC eTool Final Pay NLA procedure. 
                2.3.2.4.2. Remaining funds are funds left on a contract due to quantity variances or price rounding and where all contract performance as required by the contract has been completed and paid in full.   (ND)  For contracts administered in the MOCAS system, the functional specialist shall annotate the ACO Notebook with a remark stating, “$XX.xx (amount of remaining funds) funds are remaining funds.  When the Final Pay NLA is processed using the MCC eTool, this annotation enables MOCAS to use the Q-Final process and automatically clear the remaining funds and proceed with closing the contract.  Prior to a contract moving to Section 5, when there is a ULO balance, MOCAS automatically generates a Q-Final transaction to reduce the ULO to zero.  The payment office reviews this list to determine which contracts shall be reopened and/or adjusted for financial reconciliation, etc.  The payment office automatically reopens or moves these contracts to Section 4.  If ACO assistance is required, the payment office will contact the ACO directly.   

    2.4.  Close Other Than Fixed Price Contracts.  Actions that may be applicable to cost reimbursement type contracts, depending on the terms and conditions of the contract include:

        2.4.1.  Interim or Disallowed Costs.  (ND)  Functional specialists shall ensure that all interim or disallowed costs are settled under the contract.  In accordance with FAR 42.801 and DCMA Disallowance of Costs Instruction, at any time during the performance of a cost reimbursement contract, the ACO may issue a notice of intent to disallow costs.  When costs have been suspended or disapproved under a cost reimbursement contract, either the ACO or DCAA (DCAA Form 1) may issue a Notice of Costs Suspended and/or Disapproved Under Cost Reimbursement Contracts.  (ND) When a notice has been issued, to which all contractor appear rights have been exhausted. Should the contractor appeal the contracting officer's final decision to the Armed Services Board of Contract Appeals or the Court of Federal Claims, the contract shall remain open until completion of the litigation.  Upon settlement, in accordance with DCMA Disallowance of Costs Instruction, this action is complete.
        2.4.2.  Subcontractor Costs.  The prime contractor is responsible for auditing subcontractors and generally closes subcontracts using procedures similar to the Government.  (ND) The functional specialist shall ensure that the prime has settled subcontractor costs before closing a contract.  DCAA may issue a qualified indirect cost audit report indicating that audit of certain subcontract costs has not been completed.  When the subcontract costs (direct or indirect) are considered to be immaterial, the functional specialist may proceed with contract closeout.
        2.4.3.  Indirect Cost Rates.  (ND)  Functional specialists shall ensure that indirect cost rates are settled covering the contract period of performance.  (ND) The ACO shall not close a cost reimbursement type contract until all applicable indirect cost rates are settled, unless Quick Closeout Procedures are used to settle the indirect costs (see FAR 42.708 and paragraph 3 of this Instruction). 

            2.4.3.1.  Final indirect cost rates may be established on the basis of ACO determination procedure (see FAR 42.705-1) or by Auditor determination procedure (see FAR 42.705-2), in accordance with DCMA Final Overhead Rates Instruction.
            2.4.3.2.  FAR 52.216-7, Allowable Cost and Payment, requires the contractor to submit an adequate final indirect cost rate proposal for the establishment of final indirect cost rates.  See the DCMA Final Overhead Rates Instruction for guidance on obtaining the final indirect cost rate proposals and required ACO actions when the proposal submissions are late or inadequate.
            2.4.3.3.  When indirect cost rates are determined by DCAA, it is important that CMOs team with their DCAA counterparts to ensure audit plans for completing audits of final indirect cost rates and requesting submission of final vouchers are consistent with CMO plans for closing contracts in a timely manner.  DCAA will not prioritize or schedule final indirect cost rate proposal audits for contractors that have not submitted timely, adequate final indirect cost rate proposals.
            2.4.3.4.  This action is complete when applicable indirect cost rates have been settled.

        2.4.4.  Contractor’s Closing Statement and Final Voucher.  In accordance with FAR 42.705(b), within 120 days after settlement of the final indirect cost rates for all years of performance on a physically complete contract, the contractor shall submit a completion invoice or voucher reflecting the settled amounts and rates. 

            2.4.4.1.  The ACO may authorize, in writing, an extension to the 120 day requirement.  To determine whether a period longer than 120 days is appropriate, the contracting officer should consider whether there are extenuating circumstances as listed in FAR 42.705(b)(1) through (5).  In accordance with FAR 42.705, when the contractor fails to submit a completion invoice or voucher within the specified time period, the contracting officer should:

                2.4.4.1.1.  Unilaterally determine the amounts due to the contractor under the contract. The contracting officer determination shall be issued as a final decision in accordance with FAR 33.211.
                2.4.4.1.2.  Record the determination in a unilateral modification to the contract.  

            2.4.4.2.  FAR Clause 52.216-7, Allowable Cost and Payment, and 52.232-7, Payments under Time and Materials and Labor Hour Contracts, requires the contractor to execute and deliver:

                2.4.4.2.1.  An assignment to the Government of refunds, rebates, credits or other amounts (including interest, if any) properly allocable to costs for which the contractor has been reimbursed by the Government under the contract;
                2.4.4.2.2.  A release discharging the Government, its officers, agents, and employees from all liabilities, obligations, and claims arising out of or under the contract (some exceptions exist – see FAR Clauses 52.216-7 and 52.232-7); and
                2.4.4.2.3.  A cost voucher (SF 1034) marked as “completion” or “final”
                2.4.4.2.4.  The functional specialist shall review the final voucher package to ensure all closing documents have been obtained, are in order and properly executed.  The functional specialist shall immediately contact the contractor if required documents are missing or improperly completed.  The functional specialist should ensure that DCAA has received the final voucher package.  Upon submission of a proper final voucher package, this action is complete.

        2.4.5.  Contract Final Audit.   DCAA is authorized to perform a final audit of the contract in accordance with FAR 52.216-7(g) and 52.232-7(f).  DCAA examination of a final voucher or issuance of the Cumulative Allowable Cost Worksheet (CACWS) constitutes the final audit action on the contract. 

            2.4.5.1.  If DCAA has established a CACWS, the ACO should use the CACWS to determine the allowable costs for the contract instead of requesting DCAA perform a contract audit closing statement.  The CACWS is a summary schedule of cumulative allowable costs for each open flexibly priced contract through the last contractor fiscal year for which indirect cost rates have been settled.  It also indicates if the contract is physically complete and provides the status of assist audits to prime contractors and contracting officers.  Use of the CACWS significantly reduces resources necessary to close out a contract.  This action is complete upon review of the CACWS.
            2.4.5.2.  If there is no CACWS, the ACO should request DCAA to perform a contract audit closing statement.  In response to the request, DCAA will issue a memorandum to the ACO (in lieu of an audit report).  This action is complete upon review of the audit memorandum.

        2.4.6.  Final Voucher and Identification of Final Excess Funds.  The Public Voucher Instruction provides guidance on the specific steps for processing the completion/final voucher.  (ND) When all administrative contract closeout actions are complete, the ACO shall approve and forward the final voucher to DFAS for certification and payment in accordance with the Public Voucher Instruction.  A final review of contract funds is performed to determine if any “remaining” funds exist.  Remaining funds are funds left on contract due to price rounding or cost underruns where all contract performance as required by the contract has been completed and paid in full.  For contracts administered in the MOCAS system, the functional specialist shall annotate the ACO Notebook with a remark stating, “$XX.xx (amount of remaining funds) funds are remaining funds.  When the final voucher is processed for payment, this annotation enables MOCAS to use the Q-Final process, automatically clear the remaining funds and proceed with closing the contract.  Examples of remaining funds can be found in the Contract Closeout Guidebook.
       

        2.4.7. Final Payment.  (ND)  The functional specialist shall ensure that the final voucher has been processed by the payment office. 

            2.4.7.1.  For contracts administered in MOCAS, upon final payment and movement of the contract to Section 5 and then to Section 8, this action is complete.

                2.4.7.1.1.  If the final voucher has been paid, but the contract remains open, the ACO should verify that all prior vouchers have been paid and the payment was coded as a final payment (type 1 code) in the disbursement history.  If this is the case, the ACO may use MCC to generate and process a Final Pay NLA. 
                2.4.7.1.2. If the payment is coded as a type 2 and there are remaining funds, the ACO should ensure that the remaining funds were annotated on the ACO Notebook before using MCC to generate and process a Final Pay NLA. 

            2.4.7.2.  The functional specialist should pay special attention to incrementally funded contracts, all debts (including uncollectable debts) and price revisions to ensure that payments, including final adjustments, were made correctly.

3.  Use Quick Closeout as Appropriate.  There may be instances where the ACO should negotiate the settlement of indirect costs for a specific contract or group of contracts, in advance of the determination of final indirect cost rates.  This procedure is called Quick Closeout.  FAR 42.708 provides guidance regarding the use of quick closeout procedures. LATEST CHANGE: The new FAR requirement effective June 30, 2011 states the amount of unsettled direct and indirect costs to be allocated to any one contract, task or delivery order is relatively insignificant (i.e. does not exceed the lesser of $1,000,000 or 10% of the total contract, task order, or delivery order amount.)

    3.1.  DCMA has issued a Class Deviation authorizing ACOs to close specific contracts prior to the establishment of final indirect cost rates, regardless of dollar value or the percent of unsettled indirect costs allocable.  This deviation may be used provided the contractor has submitted a final certified indirect cost rate proposal that has been audited by the Defense Contract Audit Agency (DCAA). LATEST CHANGE:  In selected instances, the ACO may waive the audit requirement when compelling reasons exist.   The decision to waive the audit must be made by the cognizant ACO in consultation with DCAA.  ACOs are encouraged to use this deviation whenever possible. 
    3.2.  Quick closeout procedures are discussed in detail in the Contract Closeout Guidebook.
    3.3.  Unlike early closeout procedures, the determination of final indirect costs under quick closeout procedures is final for the contracts it covers and no adjustments are made to other contracts for over or under recoveries of costs allocated or allocable to the contracts covered by the advance agreement.  Additionally, indirect cost rates used in the quick closeout of a contract are not considered a binding precedent when establishing the final indirect cost rates for other contracts. 

4.  Closeout Other Disbursing Office (ODO) Contracts.  DCMA provides contract administration services for contracts that are not paid through MOCAS.  These contracts are typically referred to as ODOs and closeout varies slightly from traditional primary administration.

    4.1.  DCMA entered into a Performance Based Agreement (PBA) with the Defense Logistics Agency (DLA) to guide the administration of their contracts.  Section II, D, paragraph 4 of the PBA states, “because DCMA administration offices do not have visibility into the DLA payment system to verify submittal or payment of invoices, DCMA ACOs are not able to perform the funds review at the time of physical completion as required by FAR.  DLA has retained the responsibility for closeout of the functions required by FAR 4.804-5(a)(14), 4.804-5(a)(15), 4.804-5(b)(9), and DFARS PGI 204.804-2(1)(iv).  All other closeout actions should be performed.”  DLA ODOs close automatically if they are in MOCAS Part A and coded correctly.  The criteria for DLA Auto Closeout is as follows:

        4.1.1.  Contract is in CAR Section 2,
        4.1.2.  Dept Code = S,
        4.1.3.  Contract Level Pay Office = “9”,
        4.1.4.  R-9 Remark Contains “70”,
        4.1.5.  Physical Completion Date is at least 30 days prior to the date the contract moved to Section 2, and
        4.1.6.  Payment Office DoDAAC, SL4701, is stated in the line of accounting.  (Note:  Previous DoDAACs used by DLA Payment Office include S33181, S33184, S44073, S36054, SC0100.)  

    4.2.  If the ACO wants to prevent automatic closeout of a DLA ODO contract, enter code 56 in the R9 remarks field.  Code 56 will cause the contract to bypass the automatic closeout process.  The ACO shall manually close the contract by entering a G and F NLA to close these contracts.
    4.3.  DCMA does not have an agreement with other activities regarding our administration of ODO contracts.  Therefore, ACOs shall follow the closeout requirements as directed in FAR 4.804.  For ODO contracts other than DLA ODOs, verification should be made with the payment office that final payment has been made and that the ULO balance equals zero.  The criteria for Non-DLA ODO closeout is as follows:

        4.3.1.  Ensure all non DLA ODOs have the R9 remark code 54.
        4.3.2.  Ensure all ACO/ PCO modifications and DD Forms 250 are entered into MOCAS.
        4.3.3.  Verify that the Line Item Schedule Summary Record (LISSR) is balanced.
        4.3.4.  Ensure all contractual actions have been completed. 
        4.3.5.  Contract payment office has verified that final payment has been made and that the ULO balance equals zero.  The sources for payment information are as follows:  Pay Office, My Invoice, PCO, & contractor.
        4.3.6.  Contract shall be manually closed using MCC to generate and process a Final Pay NLA.  A DD Form 1594, Contract Completion Statement, must be completed and sent to the buying activity. 

5.  Closing Other Procurement Instruments.  Other procurement instruments include Other Transactions, NASA contracts, etc.  When closing Other Transactions, special attention should be made to property issues, payment issues, patent/royalty/march-in right issues.  This instruction applies to all prime contracts administered by DCMA.  Contracts administered in MOCAS include Part A and B contracts.  Although Other Transactions (OTs, including Technology Investment Agreements) are not covered by the FAR, the closeout process is generally the same as for contracts.  ACOs should ensure that all necessary closeout actions are accomplished within 36 months of expiration of the agreement.

    5 .1.  Unique file documentation requirements may exist for OTs and similar agreements. The file should include the following:

        5.1.1.  An invention disclosure spreadsheet, or similar information.
        5.1.2.  A property list spreadsheet or similar information,
        5.1.3.  Evidence of Government Program Manager certification that all milestones have been satisfactorily completed and that all deliverable items/reports have been accepted.
        5.1.4.  Evidence of Administrative Grant Officer review of expenditures/cost share contributions and verification of these amounts as appropriate.
        5.1.5.  Evidence that the recipient sent copies of required reports/documents to the Defense Technical Information Center, when required by the agreement.
        5.1.6.  A closeout check list or closeout worksheet or similar information.
        5.1.7.  A closeout memorandum or DD Form 1594, Contract Completion Statement, that addresses all pertinent closeout actions .

6.  Closing Support Contracts.  (ND)  When support contracts administered in MOCAS (assignment code S or T) are ready to be closed, the functional specialist shall move the contract from Section 1 to Section 5 via DD Form 1593.

7.  Closing Dormant Contracts.  (ND)  If a contract has been moved to Section 3 due to dormancy, the ACO shall ensure that the appropriate dormancy code has been entered in MOCAS.  These codes shall be reviewed and updated as necessary to ensure the system reflects current contract status.  For example, a contract was originally moved to Section 3 awaiting review by the Armed Services Board of Contract Appeals.  When the appeal was denied, the contractor filed for bankruptcy.  Accordingly, the Dormancy Reason Code should be updated from BCA to BKRPT.  In addition, if the closeout date is expected to exceed the overage date, the functional specialist shall enter an estimated closeout date and overage reason code in  MOCAS and update as necessary.

8.  Closeout Notifications to Buying Activities.  (ND)  The ACO shall notify the buying activity when all contract administration office closeout actions are complete (DFARS PGI 204.804-2(q)(iv)).  For contracts administered in MOCAS, the system automatically generates notices to the buying activity.  For contracts not administered in MOCAS, a DD Form 1594, Contract Completion Statement, or Agency equivalent, should be used to notify the buying activity of closeout progress.

    8.1.  Physical Completion. The ACO shall issue a contract completion statement (DD Form 1594) to the buying activity upon final acceptance and physical completion (DFARS PGI 204.804-2(1)(i)).  For contracts administered in MOCAS, an electronic version of the DD Form 1594 (MILSCAP Format Identifier PK Notice or EDI Transaction) is automatically generated and sent to the buying activity when a contract moves to Section 2.
 

   8.2.   Overage and R2 Remarks. The ACO shall notify the buying activity when a contract cannot be closed within the FAR mandated time standard (DFARS PGI 204.801-1(2)).  This notification shall include the reason for the delay and the new estimated closeout date (ECD) for closeout.  For contracts administered in MOCAS, functional specialists shall use MCC to update R2 overage reason codes.  The reason code and ECD should reflect the current closeout status of the contract.  For contracts administered in MOCAS, a PK Notice is automatically generated and sent to the buying activity when the functional specialist enters or updates an overage reason code and estimated closing date.  To provide a better explanation as to why the contract is overage, information may be added in the ACO notebook.  LATEST CHANGE: The functional specialist will ensure that the correct current code is input into the MOCAS system as the contract moves through the closeout process. The functional specialist shall input an “Office of Primary Responsibility” (OPR) code in the R9 remark line when certain R2 Delay overage reason codes F, H, M, P, V, or W) are used.  The OPR codes (70 Series) are: 

        8.2.1.  71 - Services
        8.2.2.  72 - Contractor
        8.2.3.  73 - DCMA
        8.2.4.  74 - DCAA
        8.2.5.  75 - DFAS

    8.3.  Final Contract Completion.  In accordance with FAR 4.804-5(b), the ACO shall notify the buying activity when administrative closeout is complete.  For contracts administered in MOCAS, a PK9 Notice is automatically generated and sent to the buying activity as follows:

        8.3.1.  Contracts Using Simplified Acquisition Procedures – based upon physical completion.
        8.3.2.  Fixed Price Contracts – based upon final payment and ACO Certification (processing of Final Pay NLA in MCC).
        8.3.3.  Cost Reimbursement Contracts – based upon ACO signature on the final voucher and processing of the final voucher for payment.
        8.3.4.  All Other Contracts – based upon final payment and ACO Certification (processing of a Final Pay NLA in MCC).