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Property Reporting Requirements

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Information about this document as published in the Federal Register.

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National Aeronautics and Space Administration (NASA).


Final rule.


This final rule amends the NASA FAR Supplement (NFS) to comply with existing Federal accounting standards and OMB rules on Form and Content of agency financial statements and makes other changes to NASA's property reporting requirements.


August 9, 2001.

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Lou Becker, NASA Headquarters, Code HK, Washington, DC 20546, telephone: (202) 358-4593, email:

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A. Background

NASA is adopting as final with changes the interim rule published in the September 11, 2000, Federal Register (65 FR 54813-54816) and as corrected in the September 28, 2000, Federal Register (64 FR 58231). The OMB Bulletin on Form and Content of Agency Financial Statements prescribes financial accounting and reporting requirements for Federal agencies. Included are accounting standards which apply to property, plant and equipment. Specific changes included in the interim rule were: Additional instructions on how to adjust previously reported values; a new definition of Agency Peculiar Property to exclude completed end items destined for permanent operation in space; and a new definition of Work in Process to include completed end items destined for permanent operation in space which otherwise meet the definition of Agency Peculiar Property. Comments were received from four groups. All comments received were considered. Changes made in this final rule are for consistency in application and are considered editorial in nature.

B. Regulatory Flexibility Act

NASA certifies that this final rule will not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) because less than three per cent of NASA contracts with small businesses have property reporting requirements.

C. Paperwork Reduction Act

The Paperwork Reduction Act, 44 U.S.C. 3501 et seq., applies to this final rule because it contains information collection requirements. Approval for the additional requirements has been obtained under OMB Control No. 2700-0017, approving an increase in burden hours from 5,700 to 8144.

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List of Subjects in 48 CFR Parts 1845 and 1852

  • Government Procurement
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Tom Luedtke,

Associate Administrator for Procurement.

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Accordingly, 48 CFR Parts 1845 and 1852 are amended as follows:

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1. The authority citation for 48 CFR Parts 1845 and 1852 continues to read as follows:

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Authority: 42 U.S.C. 2473(c)(1).

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2. Revise § 1845.7101 to read as follows:

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Instructions for preparing NASA Form 1018.

NASA must account for and report assets in accordance with 31 U.S.C. 3512 and 31 U.S.C. 3515, Federal Accounting Standards, and Office of Management and Budget (OMB) instructions. Since contractors maintain NASA's official records for its assets in their possession, NASA must obtain annual data from those records to meet these requirements. Changes in Federal Accounting Standards and OMB reporting requirements may occur from year to year, requiring contractor submission of supplemental information with the NASA Form (NF) 1018. Contractors shall retain documentation that supports data reported on NF 1018 in accordance with FAR subpart 4.7, Contractor Records Retention. Classifications of property, related costs to be reported, and other reporting requirements are discussed in this subpart. NASA Form 1018 (see 1853.3) provides critical information for NASA financial statements and property management. Accuracy and timeliness of the report are very important. If errors are discovered on NF 1018 after submission, the contractor shall contact the cognizant NASA Center Industrial Property Officer (IPO) to discuss corrective action. IPO's shall work with NASA Center finance personnel to determine appropriate corrective action and provide guidance to contractors.

3. In section 1845.7101-1, revise paragraphs (c), (d), (g)(2), (h)(2), (i)(2), the introductory text of paragraph (k), and (k)(2) to read as follows:

Property Classification.
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(c) Buildings. Includes costs of buildings, improvements to buildings, and fixed equipment required for the operation of a building which is permanently attached to and a part of the building and cannot be removed without cutting into the walls, ceilings, of floors. Contractors shall report buildings with a unit acquisition cost of $100,000 or more. Examples of fixed equipment required for functioning of a building include plumbing, heating and lighting equipment, elevators, central air conditioning systems, and built-in safes and vaults.

(d) Other Structures and Facilities. Includes costs of acquisitions and improvements of real property (i.e. structures and facilities other than buildings); for example, airfield pavements, harbor and port facilities, power production facilities and distribution systems, reclamation and irrigation facilities, flood control and navigation aids, utility systems (heating, sewage, water and electrical) when they serve several buildings or structures, communication systems, traffic aids, roads and bridges, railroads, monuments and memorials, and nonstructural improvements such as sidewalks, parking areas, and fences. Contractors shall report other structures Start Printed Page 41806and facilities with a unit acquisition cost of $100,000 or more and a useful life of two years or more.

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(g) * * *

(2) All other items.

(h) * * *

(2) All other items.

(i) * * *

(2) All other items.

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(k) Agency-Peculiar Property. Includes costs of completed items, systems and subsystems, spare parts and components unique to NASA aeronautical and space programs. Examples include research aircraft, reusable space vehicles, ground support equipment, prototypes, and mock-ups. The amount of property, title to which vests in NASA as a result of progress payments to fixed price subcontractors, shall be included to reflect the pro rata cost of undelivered agency-peculiar property. Completed end items which otherwise meet the definition of Agency-Peculiar Property, but are destined for permanent operation in space, such as satellites and space probes, shall be reported as Contract Work in Process. Contractors shall separately report:

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(2) All other items.

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4. In section 1845.7101-2, amend the first sentence of the introductory paragraph by capitalizing the word “Centers” the first time it appears and add the following sentence at the end of paragraph (c) to read as follows:

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Transfers of property.
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(c) * * * The contracting officer shall assist the Government Property Administrator and the receiving contractor to obtain all required information for the receiving contractor to establish adequate property records.

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5. In section 1845.7101-3, delete paragraph (a)(12); amend the second sentence of paragraph (a) and paragraph (e) to read as follows:

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Unit acquisition cost.

(a) * * * The following is representative of the types of costs that shall be included, when applicable: * * *

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(e) Only modifications that improve an item's capacity or extend its useful life two years or more and that cost $100,000 or more shall be reported on the NF 1018 on the $100,000 & Over line. The costs of any other modifications, excluding routine maintenance, will be reported on the Under $100,000 line. If an item's original unit acquisition cost is less than $100,000, but a single subsequent modification costs $100,000 or more, that modification only will be reported as an item $100,000 or more on subsequent NF 1018s. The original acquisition cost of the item will continue to be included in the under $100,000 total. The quantity for the modified item will remain “1” and be reported with the original acquisition cost of the item. If an item's acquisition cost is reduced by removal of components so that its remaining acquisition cost is under $100,000, it shall be reported as under $100,000.

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6. In section 1845.7101-4, revise paragraphs (b) and (h) to read as follows:

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Types of deletions from contractor property records.
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(b) Transferred in Place. Deletion amounts that result from transfer of property to a follow-on prime contract or other prime contract with the same contractor.

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(h) Other. Types of deletion other than those reported in paragraph (a) through (g) of this section such as those resulting from reclassifications (e.g. from equipment to agency-peculiar property).

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7. Amend section 1845.7101-5, by removing the last sentence.

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8. Amend the clause at section 1852.245-73 by revising the date of the clause, paragraphs (b)(2), (b)(3), and the fifth sentence of paragraph (c) to read as follows:

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Financial Reporting of NASA Property in the Custody of Contractors.
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Financial Reporting of NASA Property in the Custody of Contractors (August 2001)

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(b)(1) * * *

(2) The Contractor shall mail the original signed NF 1018 directly to the cognizant NASA Center Deputy Chief Financial Officer, Finance, unless the Contractor uses the NF 1018 Electronic Submission System (NESS) for report preparation and submission.

(3) One copy shall be submitted (through the Department of Defense (DOD) Property Administrator if contract administration has been delegated to DOD) to the following address: [Insert name and address of appropriate NASA Center office.], unless the Contractor uses the NF 1018 Electronic Submission System (NESS) for report preparation and submission.

(c) * * * The Contracting Officer may, in NASA's interest, withhold payment until a reserve not exceeding $25,000 or 5 percent of the amount of the contract, whichever is less, has been set aside, if the Contractor fails to submit annual NF 1018 reports in accordance with 1845.505-14 and any supplemental instructions for the current reporting period issued by NASA. * * *

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[FR Doc. 01-19996 Filed 8-8-01; 8:45 am]