Dictionary of Procurement Terms

A subset of the Federal Acquisition Regulations (FAR) that directly apply to the U.S. Department of Defense (DOD).

Government spending in excess of the revenues collected or budgeted during a given fiscal year.

Term used when a specific requirement quantity and delivery date have been established.

The important or material terms of an agreement that are specifically expressed. Under common law, an offer must include the important, or material, terms of the proposed agreement so that, when a party accepts the offer, a resulting agreement is enforceable. Important terms include subject matter, price, payment terms, quantity, quality, duration, and the scope of work to be done. If the parties purport to agree on a material term, but do so in a vague manner, as contrasted from omitting the term altogether, there is no agreement because it is too indefinite.

Phenomenon that occurs when the general level of prices decreases to the point that the inflation rate becomes negative. See also: Inflation.

A claim filed by a contractor or an owner for unanticipated delays to a project. Delay claims require significant documentation and are based in part on cost accounting concepts. When a contractor delays a project, the owner can recover one of two types of damages: liquidated or actual. The components of a Contractor Delay Claim include indirect costs, home office overhead, increased material direct costs, lost productivity, and other damages directly related and attributable to a delay.

Authorized or appointed individuals, outside the procurement department, who are delegated the authority under an entity’s rules and procedures to make purchases, generally small dollar, on behalf of an entity.

The conferring of authority by someone who has it to another person to accomplish a task.

1. The actual contractual work product as defined in the statement of work; the desired goods or services described in a statement of requirement, specifications, scope of work, or other similar solicitation component to be provided under the contract. (Australia) 2. The completion of a milestone or the accomplishment of a task that can be measured and verified and may be a unit by which a contractor or consultant may be paid. See also: Milestone.

The physical transfer of possession from one party to another, as from a carrier, supplier, or contractor to the purchaser. See also: Free on Board (F.O.B.) Destination, Freight Collect, Freight Collect and Allowed, Freight Prepaid and Added, Freight Prepaid and Allowed, Free on Board (F.O.B.) Origin, Freight Prepaid and Charged Back.