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Supplying Principles and Practices > USPS Supplying Practices Process Process Step 5: Measure and Manage Supply > Close Out Contract
Close Out Contract
Contract closeout is the administrative procedure associated with the end of
the business agreement with the Supplier and the archiving of documents in
the contract file. Contract closeout occurs after the Supplier has successfully
completed contract performance and has been accordingly compensated or
when the contract is terminated for default or convenience. The primary
purpose of contract closeout is to ensure that the Supplier has complied with
all contractual requirements and that the Client's needs have been met and
fulfilled. Contracts that are improperly performed or that fail to offer best value
to the Postal Service are appropriate for termination for default or termination
for convenience and are addressed in detail in the Terminate Contract topic
of the Make Payment task of Process Step 5: Measure and Manage Supply.
A contract is considered performed and fully completed when:
• Supplier has completed the required deliveries, and the Client
has subsequently received, inspected, and accepted the products
• Supplier has performed all services, and the Client has accepted
these services
• Contract performance has been officially assessed and evaluated
in the Evaluate Contract Effectiveness topic of the Manage
Delivery and Contract Performance task of Process Step 5:
Measure and Manage Supply
• Final payment has been made
• Decision has been made to neither renew the contract nor
exercise options on the contract
The Contracting Officer is responsible for ensuring that the following contract
closeout activities are performed:
• Scope verification - occurs at the end of the tasks and phases
associated with the project to ensure that all the scope
requirements for that task, phase, or project have been
accomplished; demonstrates that sound business judgment was
applied to the overall purchase project
• Financial review - determines whether all the invoices are paid
and whether the actual expenditures matched the planned
budget. Invoices and payment are explained, in detail, in the
Process Invoices and Make Payment topics of the Make Payment
task of Process Step 5: Measure and Manage Supply
• Product/service delivery and acceptance - acknowledges receipt
of products and services conforming to contract specifications
during the Receipt and Inspection and Acceptance topics of the
Complete Delivery task of Process Step 4: Deliver and Receive
Requirements
• Client sign-off - after the Client accepts the products or services
defined in the contract, it must sign off on products or services
after delivery; acknowledgement of receipt of the products or
services allows for closeout of the contract
• Lessons learned - Purchase/SCM Team members must capture
and share the lessons learned from the project, including
analyzing data and discussing project results with participants;
lessons learned are used to improve future purchase projects and
the overall purchasing process; the information is then
summarized and archived, as explained by the Share Lessons
Learned topic of the Manage Delivery and Contract Performance
task of Process Step 5: Measure and Manage Supply
• Inventory management and disposal - products that have been
accepted may no longer require input from the Supplier and will
remain the responsibility of the Postal Service; the Item Manager
must ensure that products are being properly stored for future
use, as explained in the Develop, Finalize, and Implement
Inventory Control Plan topic of the Manage Demand task of
Process Step 5: Measure and Manage Supply; products that the
Supplier has delivered and have already been utilized are
appropriate for disposal or investment recovery, which are
explained in detail in the Dispose topic of the Investment
Recovery task of Process Step 6: End of Life
• Personnel reassignment - as the end of the contract
approaches, it is the Client's responsibility to ensure that
Purchase/SCM Team members from the Client organization are
assigned current projects or deployed to future projects, and it is
the Contracting Officer's responsibility to ensure that
Purchase/SCM Team members from Supply Management (SM)
are assigned current projects or deployed to future projects
• Close and archive files - project-related plans, reports, and any
other pertinent documentation, as well as the contract files must
be closed out and archived by the Contracting Officer at the end
of the project; the contract file must contain sufficient
documentation to permit an outside party to review and
understand the process and business decisions that resulted in
contract award, contract modification, and contract expiration; the
warning notices and records associated with contracts terminated
for default or convenience must also be placed in the contract file
Upon completion of contract closeout procedures, the Contracting Officer
must officially signify that Client sign-off has been completed and include any
related questions or recommendations in the contract file.
Receipt and Inspection topic, Complete Delivery task, Process Step 4:
Deliver and Receive Requirements
Acceptance topic, Complete Delivery task, Process Step 4: Deliver and
Receive Requirements
Develop, Finalize, and Implement Inventory Control Plan topic, Manage
Demand task, Process Step 5: Manage and Measure Supply
Evaluate Contract Effectiveness topic, Manage Delivery and Contract
Performance task, Process Step 5: Measure and Manage Supply
Make Decision to Renew or Exercise Options topic, Manage Delivery and
Contract Performance task, Process Step 5: Measure and Manage Supply
Share Lessons Learned topic, Manage Delivery and Contract Performance
task, Process Step 5: Measure and Manage Supply
Process Invoices topic, Make Payment task, Process Step 5: Measure and
Manage Supply
Make Payment topic, Make Payment task, Process Step 5: Measure and
Manage Supply
Terminate Contract topic, Make Payment task, Process Step 5: Measure and
Manage Supply
Dispose topic, Investment Recovery task, Process Step 6: End of Life
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