Independent Government Cost Estimates and the Statement of Work
Business 501 – Government Acquisition

Evaluate the importance of the IGCE.

Independent Government Cost Estimates is always a very important part of successful implementation and execution of effective acquisition programs both in the private as well as the Government sector. A cost estimate is a future projection of the values of goods and services and a forecast of the economics of these goods and services that are to be delivered in the future. Independent Government Cost Estimate is an economic projection for Government that provides with the detailed estimate of the costs of services and supplies. This estimation is generally acquired from the contractors. However the Independent Government Cost Estimate must be carried out as government own in-house estimate and no information must be obtained from the contractors. IGCE is an independent estimate by the government of what a responsible contractor should propose to government or private sector based on the statement of the work. (Independent Government Cost Estimate, 2016)
A number of steps are required in conducting an IGCE and all of these steps must be followed to conduct a competitive estimation. The first step is to know the requirement, project and the services that are going to be procured. In this case we must know about the actual purpose of this two million dollar procurement. The Statement of Work is very important in this respect as it provides us with purpose of the procurement. The work that is not included in SOW should not be included for estimation.
In order to conduct a purposeful IGCE it is important to declare the milestones of the completion of the cost estimation and the milestones of completion of the project itself. One should keep in mind that every cost estimate is prepared with a forecast and cannot be prepared with absolute certainty and authenticity. ((NSCEP), 1994)

Examine the reasons for confidentiality of the IGCE. Propose two (2) actions that should be taken in order to maintain the confidentiality of the IGCE.

The confidentiality of ICGE is very important as it provides a standard cost estimation and it must not be declared public before examining the quotations from different other contractors and suppliers. The basic purpose of an IGCE is to serve as a foundation for reserving monetary resources for the contract and hence it is kept confidential until all the monetary resources are made public by the contractors. It also acts a tool to compare costs offered by different contracts on the same projects so the information must be kept confidential until all the contractors have submitted the acquisitions regarding the project. The information is also kept confidential as it is a tool of determining price reasonableness if only one vendor responds to the project solicitation.
Two actions that the IGCE should take in order to maintain confidentiality are they could use some form of encryption if they have to display information on public sites, this way only certain officers of the IGCE would be able to see the information. They should also develop system to dispose of contract submissions once the contract award recipient has been determined.

Detailed Cost Estimate

Independent Government Cost Estimation for Two Million Dollar Procurement
Project Title Radar and Camera Equipped for 52 Towers
Project Manager
Period of Performance
From
To
January 2016
January 2026
Description of Cost Elements
Direct Labor
Estimated Hours
Rate per Hour
Estimated Cost
Total Estimated Cost
Worker Chief
1,000 x
$ 25
25,000

Worker Manager
2,000 x
$ 12.5
25,000

Worker A
25,00 x
$ 10
25,000

Worker B
5,000 x
$ 5
25,000

Total Direct Labor Cost

$ 100,000
Overhead
Rate
Total Labor
Estimated Cost
Total Estimated Cost

150 percent
100,000
150,000
150,000
Material Services
Estimated Cost
Total Estimated Cost

0
0
Information Technology Support
Estimated Cost
Total Estimated Cost
Training for Camera Operators
PCs = $12/hour x 1320 Hours
Mainframe = 57 per hour x 330 hours
Software= 20 programs x 350 each
$ 41,650
$41,650
Subcontractor and Consultants
Estimated Cost
Total Estimated Cost
Delivery Services
Materials and Supplies
Reports
Reproduction

$ 2,080
$ 100,000
$ 32,500
$ 1,200

$ 135,780
Type Name and Title

Signature
Office Division and Branch
Date

Evaluate the types of statements of work in regard to compatibility with this contract.

Statement of work is a complex and confidential document that contains the record of the work activities, the deliverables of the project, milestone and the timeline that a contractor must follow regarding accomplishing a particular project for any client. Statement of Work includes a number of different elements such as requirements of the project, pricing and cost of the project, rules and Government implications towards the project. There are different types of Statement of Work, there is a Functional Based SOW, Performance Based SOW and a Design Based SOW.(Compton, 2010) However the following few parts are the integral parts of each and every SOW and are described below.
Background
This portion attempts the purpose of the project that why we are going to build or accomplish this project
Scope of Work
This section tells about the rough details of the work that how the work will be carried out at sites. What kind of labor will be involved and what hardware and software will be used in the project
Documentation
All documentation that is required for the acquisition, such as specifications, standards and other reference material associated with the requirements, should be included in this section. You may also want to present these documents as attachments as well.
Requirements
This section describes any requirements involved in the project such as the use of special labor, special hardware or software in the project. This could be considered the main body of the SOW. It contains explicit, detailed information on the work to be performed. The content of this section will be dictated by the requirements of the government..
The requirements of this contract are highly important so the Statement of Work must be designed with detail. (Statement of Work (SOW), 2010)
Determine the most appropriate type of statement of work for this contract. Support your position.
As I mentioned earlier there are three types of statements of work(SOW). A functional based SOW describes the “what, when and where” of the supplies or services to be provided and it allows the vendor to determine the most efficient means of accomplishing the work. A performance based SOW describes the government’s top-level objectives for an acquisition and is more appropriate for service contracts. A design based SOW defines the design requirements or essential physical characteristics are used mostly for architect-engineer, construction and commercial contracts.These statements describe in detail how the work will be performed and materials will be used. So the most appropriate statement of work for this job would be a design based SOW.(Compton, 2010) So for this contract, since it would be considered a construction contract, it would need to describe the nature and volume of work. The contract would also need to include the estimated price range for the project, but we already have that based on the requirements provided.(Compton, 2010)

References

Compton, P. B. (2010). Federal acquisition: Key issues and guidance. Vienna, VA: Management Concepts, Inc.
Independent Government Cost Estimate. (2012, March 22). Retrieved January 23, 2016, from http://www.niaid.nih.gov/researchfunding/sop/pages/igce.aspx
Statement of Work (SOW). (2010, April 4). Retrieved April 16, 2013, from https://dap.dau.mil/ acquipedia/Pages/ArticleDetails.aspx?aid=488854b0-d8ee-4e32-aa3e-301d2ac8ffca
(NSCEP), N. S. (1994, June 6). Independent Government Cost Estimate. Retrieved January 23, 2016