Cost-realism analysis is an objective process of identifying the specific elements of a cost estimate or a proposed price and comparing those elements against reliable and independent means of cost measurement, and is particularly useful in the evaluation of cost reimbursement contracts. This analysis determines whether the estimates under analysis are verifiable, complete, and accurate. It also shows whether the supplier’s estimating methodology is logical, appropriate, and adequately explained. As a result, the analysis helps ensure that the cost or prices proposed fairly represent the costs likely to be incurred for the proposed services, given the supplier’s technical and management approach.