FAR 49.602-3—Schedule of accounting information.
Plain-English Summary
FAR 49.602-3 is a narrow but important documentation rule in the termination settlement process. It tells contractors and contracting officers when Standard Form 1439, Schedule of Accounting Information, must accompany a settlement proposal and when it is not required because the proposal is submitted on Standard Form 1438, Settlement Proposal (Short Form), under FAR 49.206-1(e). In practice, this section is about supporting the financial basis of a termination settlement by showing the accounting data behind the claimed costs, so the Government can evaluate the proposal efficiently and consistently. It matters because termination settlements often involve complex cost claims, and the accounting schedule helps establish what costs were incurred, how they were accumulated, and whether the proposal is adequately supported. The section does not itself describe how to complete the form or how to price the settlement; it simply establishes when the accounting information schedule must be filed as part of the settlement package.
Key Rules
SF 1439 is normally required
A settlement proposal must be supported by Standard Form 1439, Schedule of Accounting Information, unless an exception applies. This makes SF 1439 the default supporting document for termination settlement submissions.
Short-form proposals are exempt
If the settlement proposal is filed on Standard Form 1438, Settlement Proposal (Short Form), SF 1439 is not required. The short-form process is the specific exception identified in this section.
Cross-reference controls the exception
The exemption for SF 1438 is tied to FAR 49.206-1(e). Users must look to that provision to confirm when the short-form settlement proposal is appropriate and therefore when the accounting schedule may be omitted.
Support for settlement review
The purpose of the accounting schedule is to provide the financial and accounting detail needed to support review of the settlement proposal. It helps the contracting officer assess the claimed amounts and the underlying accounting records.
Responsibilities
Contractor
Submit SF 1439 with the settlement proposal unless the proposal is properly filed on SF 1438. The contractor must ensure the accounting information supporting the settlement is available and consistent with the proposal.
Contracting Officer
Determine whether the settlement proposal is submitted on the standard or short form and verify that the required supporting accounting information is included. If SF 1439 is required and missing, the contracting officer should request the needed support before final settlement action.
Agency
Provide the forms and procedural framework for termination settlement submissions and ensure personnel apply the correct form requirements under FAR Part 49.
Practical Implications
For most termination settlements, contractors should expect to prepare SF 1439 as part of the package; omitting it when required can delay negotiation and payment.
The main pitfall is assuming the accounting schedule is optional. It is only omitted when the proposal is properly filed on SF 1438 under the referenced short-form rule.
Contracting officers should check the form used before reviewing the substance of the claim, because the required supporting documentation differs depending on whether the standard or short form is used.
Because this section is only a filing requirement, it does not excuse weak accounting support. Contractors still need records that tie claimed costs to their books and supporting data.
When in doubt, parties should verify the applicability of FAR 49.206-1(e) before deciding whether SF 1439 is required.
Official Regulatory Text
Standard Form 1439 , Schedule of Accounting Information, shall be filed in support of a settlement proposal unless the proposal is filed on Standard Form 1438 , Settlement Proposal (Short Form) (see 49.206-1 (e)).