Northrop Grumman Corporation

September 9, 2014Judge Delman

Denied / Government PrevailedCost Allowability / Allocability (FAR 31)Contract InterpretationDCAA InvolvedDCMA Involved

Northrop Grumman Corporation sought reconsideration of the Board’s decision denying its appeal on entitlement concerning the allowability of claimed PRB costs measured and assigned using DEFRA. The Board held that the motion repeated previously rejected arguments, established no Board error, and affirmed its prior decision.

Material Facts

Northrop Grumman used DEFRA to measure and assign PRB costs.
The claimed costs included unfunded prior year PRB costs.
The government’s Disclosure Statement responses stated that disclosed practices were not thereby deemed proper, approved, or agreed to practices.
The DCAA auditor was aware of Northrop Grumman’s use of DEFRA in the 1990s.
The DCAA auditor did not question the methodology or related annual costs because Northrop Grumman was not claiming costs in excess of those allowed under FAS 106.
Northrop Grumman asserted that the government’s awareness, communications, inaction, and the 2002 GAO Review supported its position.

Parties

Appellant: Northrop Grumman Corporation
Respondent Agency: Defense Contract Management Agency
Contract Number: N68936-05-C-0059

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