CPAF

Submitted by dipti1pmp on Mon, 10/27/2014 - 13:20

what is the difference between CP FIXED FEE AND CP award fee contract. Can some one explain in simple terms ? Also which in which dos the buyer has most risk.

Regards,
Dipti

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admin

Tue, 10/28/2014 - 02:18

if you are building a house

CPFF will be $1 million + $10K Fixed fee which is usually the profit of seller

CPAF will be something like $1million + $10K ( provided some conditions are met based on contractors performance) . This is usually done to ensure timely completions within cost.

In some contracts, the fee is determined subjectively by an awards fee board whereas in others the fee is based upon objective performance metrics. An aircraft development contract, for example, may pay award fees if the contractor achieves certain speed, range, or payload capacity goals

dipti1pmp

Tue, 10/28/2014 - 05:17

so I understand that CPFF has a greater risk ....than CPAF