The Single Source Contract Regulations 2014

Quarterly contract report U.K.

26.—(1) Subject to paragraphs (2) to (5), the primary contractor must provide a quarterly contract report for the qualifying defence contract within one month of the end of each calendar quarter from the initial reporting date until the contract completion date.

(2) No report is required for the calendar quarter in which the initial reporting date falls.

(3) The first report must be for the period from the initial reporting date to the end of the next calendar quarter.

(4) No report is required for the calendar quarter in which the contract completion date falls.

(5) No report is required for a contract if the value of the contract is less than £50,000,000.

(6) The report must contain the following information—

(a) an annual profile (or, if the contractor is of the view that it is not possible to express these matters in an annual profile, the total amount) of the following matters which have been, or are expected to be, taken into account in determining the contract price—

(i) any risk contingency element included in the allowable costs;

(ii) planned amounts of profit, excluding any amount resulting from an adjustment determined under step 5 of regulation 11; and

(iii) the maximum amount of profit resulting from an adjustment determined under step 5 of regulation 11;

(b) an annual profile of the estimated costs (split by the contractor reporting structure) at the time of agreement;

(c) an annual profile (or, if the contractor is of the view that it is not possible to express these matters in an annual profile, the total amount) of the following matters—

(i) any risk contingency element,

(ii) planned amounts of profit, excluding any amount resulting from an adjustment determined under step 5 of regulation 11, and

(iii) the expected maximum amount of profit resulting from an adjustment determined under step 5 of regulation 11,

that reflect the costs already incurred and the forecast costs which are expected to be incurred, indicating for each year whether those costs have been incurred, are forecast, or a combination of both;

(d) an annual profile of the costs already incurred and the forecast costs which are expected to be incurred, split by the contractor reporting structure and indicating for each year whether those costs have been incurred, are forecast, or a combination of both;

(e) a breakdown of the costs already incurred and the forecast costs by reference to the calendar quarters of each of—

(i) the financial year in which the calendar quarter to which the report relates falls,

(ii) the previous financial year, and

(iii) the next financial year,

split by the contractor reporting structure;

(f) a quantified analysis of the causes of variance (explaining not less than 90% of the total variance) between any estimated costs used to determine the contract price and the total actual and forecast costs;

(g) a forecast of any TCIF adjustment or any final price adjustment (regulation 16) which the contractor expects will be made;

(h) a description of any event that has occurred, or circumstances which have arisen, since the contract was entered into, that have had or are likely to have a material effect in relation to the contract, including—

(i) the date on which the contractor became aware of the event or circumstances;

(ii) whether the event or circumstances are covered by any contingency element of the contract price;

(iii) the effect that the event or circumstances have had on the costs already incurred; and

(iv) the forecast effect that the event or circumstances will have on the forecast costs which it is expected will be incurred;

(i) a list of—

(i) all delivery milestones set out in the contract;

(ii) where the contract sets an expected date for a delivery milestone to be completed, that date; and

(iii) the actual or expected delivery date for each delivery milestone;

(j) a description of any actual or intended sub-contracts which the primary contractor has entered into, or intends to enter into, for the purposes of enabling it to perform its obligations under the qualifying defence contract (including the total proportion of the value of the qualifying defence contract which the contractor expects to sub-contract); and

(k) in relation to each such sub-contract into which the primary contractor has entered in the period covered by the report, or intends to enter in the calendar quarter following the period covered by the report, and which has or is expected to have a value of not less than £1,000,000 (or, if there are more than 20 such sub-contracts, each of the 20 which have or are expected to have the highest value)—

(i) if the sub-contractor is a registered company, its registered name and company number, and the address of its registered office;

(ii) if the sub-contractor is not a registered company, its name;

(iii) whether the sub-contractor is associated with the primary contractor;

(iv) whether the sub-contractor is an SME;

(v) a brief description of the goods, works or services that will be provided under the sub-contract;

(vi) the date on which the sub-contract was, or is expected to be, entered into;

(vii) the contract completion date (or, if that date is not known, the expected contract completion date);

(viii) the (actual or estimated) price payable under the sub-contract; and

(ix) if an assessment has been made under regulation 61(1) or (4), the outcome of that assessment.

(7) In this regulation, “contractor reporting structure” means the breakdown of contract costs into the categories used by the contractor for its own internal contract management purposes.