SF 1438 Settlement Proposal (Short Form)

OMB Control Number: 9000-0012
Expiration Date: 2/29/2020

SETTLEMENT PROPOSAL (SHORT FORM)

Paperwork Reduction Act Statement - This information collection meets the requirements of 44 USC § 3507, as amended by section 2 of the Paperwork Reduction
Act of 1995. You do not need to answer these questions unless we display a valid Office of Management and Budget (OMB) control number. The OMB control
number for this collection is 9000-0012. We estimate that it will take 2.5 hours to read the instructions, gather the facts, and answer the questions. Send only
comments relating to our time estimate, including suggestions for reducing this burden, or any other aspects of this collection of information to: General Services
Administration, Regulatory Secretariat Division (M1V1CB), 1800 F Street, NW, Washington, DC 20405.
For Use by a prime Contractor or Subcontractor in Settlement of a Fixed Price Terminated Contract When Total Charges Claimed Are Less Than $10,000.
COMPANY (Prime or Subcontractor)

THIS PROPOSAL APPLIES TO (Check one)
A PRIME CONTRACT
SUBCONTRACT OR
WITH THE GOVERNMENT
PURCHASE ORDER
SUBCONTRACT OR PURCHASE ORDER NUMBER(S)

STREET ADDRESS

CONTRACTOR WHO SENT NOTICE OF TERMINATION
NAME
CITY AND STATE (Include ZIP code)
ADDRESS (Include ZIP Code)

NAME OF GOVERNMENT AGENCY

GOVERNMENT PRIME CONTRACT NUMBER

If moneys payable under the contract have been assigned, give the following:
NAME OF ASSIGNEE
CONTRACTOR'S REFERENCE NUMBER EFFECTIVE DATE OF TERMINATION
ADDRESS (Include ZIP Code)

SECTION I - STATUS OF CONTRACT OR ORDER AT EFFECTIVE DATE OF TERMINATION
FINISHED
UNFINISHED OR NOT
COMMENCED
ON
HAND
PRODUCTS COVERED BY TERMINATED
PREVIOUSLY
TO
BE
PAYMENT
TO
CONTRACT OR PURCHASE ORDER
SHIPPED AND BE RECEIVED INCLUDED IN THIS COMPLETED
NOT TO BE
(Partial
THROUGH
COMPLETED
INVOICED
PROPOSAL
(a)

(b)

INVOICING
(c)

(d)

termination only)
(e)

(f)

TOTAL
COVERED BY
CONTRACT
OR ORDER
(g)

QUANTITY
$
QUANTITY
$
QUANTITY
$
N
U
M
B
E
R

1

SECTION II - PROPOSED SETTLEMENT
AMOUNT OF
CHARGE ($)

ITEM
(Include only items allocable to the terminated portion of contract)

2

CHARGE FOR ACCEPTABLE FINISHED PRODUCT NOT COVERED BY INVOICING (from SF 1428)
CHARGE FOR WORK-IN-PROGRESS, RAW MATERIAL, ETC. ON HAND (from SF 1428)

3
4

OTHER CHARGES INCLUDING PROFIT AND SETTLEMENT EXPENSES
CHARGES FOR SETTLEMENT(S) WITH SUBCONTRACTORS

5
6

GROSS PROPOSED SETTLEMENT (Sum of Items 1 THRU 4)
DISPOSAL AND OTHER CREDITS (from SF 1424, Item 27, Col.3)

7

NET PROPOSED SETTLEMENT (Item 5 less 6)

8
9

ADVANCE, PROGRESS, AND PARTIAL PAYMENTS
NET PAYMENT REQUESTED (Item 7 less 8)

List your inventory on SF 1428 and attach a copy thereto. Retain for the applicable period specified in the prime contract all papers and records relating to this
proposal for future examination.
GIVE A BRIEF EXPLANATION OF HOW YOU ARRIVED AT THE AMOUNTS SHOWN IN ITEMS 3, 4, 6, AND 7

I CERTIFY that the above proposed settlement includes only charges
allocable to the terminated portion of the contract or purchase order,
that the total charges (Item 5) and the disposal credits (Item 6) are fair
and reasonable, and that this proposal has been prepared with
knowledge that it will, or may, be used directly or indirectly as a basis
for reimbursement under a settlement proposal(s) against agencies of
the United States.

NAME OF YOUR COMPANY
BY (Signature of authorized official)
TITLE

DATE

(Where the space provided for any information is insufficient, continue on a separate sheet.)
STANDARD FORM 1438 (REV. 5/2004)

AUTHORIZED FOR LOCAL REPRODUCTION
Previous edition is not usable

Prescribed by GSA-FAR (48 CFR) 53.249(a)(5)

INSTRUCTIONS

1. This settlement proposal should be submitted
to the contracting officer, if you are a prime
contractor, or to your customer, if you are a
subcontractor. The term contract as used
hereinafter includes a subcontract or a purchase
order.

necessary and are properly allocable to the
terminated portion of your contract under the
recognized commercial accounting practices,
including direct and indirect manufacturing, selling
and distribution, administrative, and other costs
and expenses incurred.

2. Proposals that would normally be included in
a single settlement proposal, such as those based
on a series of separate orders for the same item
under one contract should be consolidated
wherever possible, and must not be divided in
such a way as to bring them below $10,000.

b. SETTLEMENT WITH SUBCONTRACTORS Reasonable settlements of proposals of
subcontractors allocable to the terminated portion
of subcontract. Copies of such settlements will be
attached hereto..

3. You should review any aspects of your
contract relating to termination and consult your
customer or contracting officer for further
information. Government regulations pertaining to
the basis for determining a fair and reasonable
termination settlement are contained in Part 49 of
the Federal Acquisition Regulation. Your proposal
for fair compensation should be prepared on the
basis of the costs shown by your accounting
records. Where your costs are not so shown, you
may use any reasonable basis for estimating your
costs which will provide for fair compensation for
the preparations made and work done for the
terminated portion of the contract, including a
reasonable profit on such preparation and work.
4. Generally your settlement proposal may
include under Items 2, 3, and 4, the following:
a. Costs - Costs incurred which are reasonably

c. SETTLEMENT EXPENSES - Reasonable
costs of preparations you have made and work
you have actually done for the terminated portion
of your contract. No profit should be included for
work which has not been done, nor shall profit be
included for settlement expenses, or for
settlement with subcontractors.
d. PROFIT - A reasonable profit with respect to
the preparations you have made and work you
have actually done for the terminated portion of
your contract. No profit should be included for
work which has not been done, nor shall profit be
included for settlement expenses, or for
settlement with subcontractors.
5. If you use this form, your total charges being
proposed (line 5), must be less than $10,000. The
Government has the right to examine your books
and records relative to this proposal, and if you
are a subcontractor, your customer must be
satisfied with your proposal.

STANDARD FORM 1438 (REV. 5/2004) BACK