Annual Certifications

Global Supply Chain
Supplier Certification of Accounting Systems and Controls

Section 1: Supplier Certification of Accounting/Billing System and Control

To ensure Supplier’s accounting/billing system is adequate to report and invoice costs incurred in performance of a flexibly-priced Purchase Order/Subcontract awarded to Supplier and to support the determination of compliance to the requirements of FAR Part 16.301-3(a)(1) and/or FAR Part 32.503-3(a)(2), Supplier must provide one of the following as proof of certification. This certification does not guarantee award of a Purchase Order or Subcontract to the Supplier.

Please check the appropriate box:

Section1

A copy of Supplier’s most recent U.S. Government letter reflecting the status of Supplier’s accounting/billing system is submitted and attached to this signed certification. Supplier certifies that the U.S. Government audit resulted in a conclusion that the Supplier’s accounting/billing system was adequate/acceptable, and compliant with applicable laws/regulations. Supplier represents that the most recent U.S. Government letter provided reflects the current status of Seller’s accounting system, which remains approved. Supplier agrees to update Northrop Grumman Authorized Buyer/Subcontract Administrator (SCA) of any change in Supplier’s accounting/billing system status.

1A.

The Government has reviewed our system within the past twelve (12) months and noted minor control deficiencies requiring corrective action. However, our system remains approved at this time. (Only check if applies)

The Government has reviewed our system within the past twelve (12) months and noted significant deficiencies requiring corrective action. Our system has been disapproved at this time. (complete checklist below)

Supplier hereby submits a copy of an independent third party opinion attesting to the adequacy of the Supplier’s accounting/billing system. Supplier agrees to update Northrop Grumman’s Authorized Buyer/SCA of any change in Supplier’s accounting/billing system status. (complete checklist below)

3A.

There have been no changes in our Accounting System within the past twelve (12) months. Supplier continues to maintain an acceptable accounting system and shall promptly notify Northrop Grumman’s Authorized Buyer/SCA, in writing, of any identified deficiency. Supplier understands that an acceptable accounting system is a condition of award, and failure to maintain an acceptable accounting system as defined above, may result in the withholding of payments or termination for cause. (only check if applies and complete checklist below)

Supplier certifies that its job-cost (Cost Accounting) or general accounting system follows Generally Accepted Accounting Principles (GAAP), is currently in full operation and meets the criteria found in the checklist below (sections a through r). Supplier agrees to update Northrop Grumman’s Authorized Buyer/SCA of any change in Supplier’s accounting/billing system status.

4A.

Supplier does not currently have an accounting/billing system that meets the definitions above. NOTE: If this box is checked, Supplier may only receive Firm-Fixed Price (FFP) awards.

	(Checklist for question 2, 3, or 3a -Check Yes/No for each requirement)	Yes	No
a.	A sound internal control environment, accounting framework, and organizational structure
b.	Proper segregation of direct costs from indirect costs
c.	Identification and accumulation of direct costs by contract
d.	A logical and consistent method for the accumulation and allocation of indirect costs to intermediate and final cost objectives
e.	Accumulation of costs under general ledger control
f.	Reconciliation of subsidiary cost ledgers and cost objectives to general ledger
g.	Approval and documentation of adjusting entries
h.	Periodic monitoring of the system
i.	A timekeeping system that identifies employees’ labor by intermediate or final cost objectives
j.	A labor distribution system that charges direct and indirect labor to the appropriate cost objectives
k.	Interim (at least monthly) determination of costs charged to a contract through routine posting of books of account
l.	Exclusion from costs charged to Government contracts of amounts which are not allowable in terms of Federal Acquisition Regulation (FAR) part 31, Contract Cost Principles and Procedures, and other contract provisions
m.	Identification of costs by purchase order line item and by units (as if each unit or line item were a separate contract) if required by the proposed contract
n.	Segregation of pre-production costs from production costs, as applicable
o.	Cost accounting information as required – a) By contract clauses concerning limitation of cost (FAR 52.232-20), limitation of funds (52.232-22), or allowable cost and payment (FAR 52.216-7); and b) To readily calculate indirect cost rates from the books of accounts
p.	Billings that can be reconciled to the cost accounts for both current and cumulative amounts claimed and comply with contract terms
q.	Adequate, reliable data for use in pricing follow-on acquisitions
r.	Accounting practices in accordance with standards promulgated by the Cost Accounting Standards Board, if applicable, otherwise, Generally Accepted Accounting Principles

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Comments

Certification of Supplier or Seller

Supplier attests to the accuracy of the information contained herein. Supplier understands that they may be subject to costs, liabilities or penalties imposed by Northrop Grumman or the United States Government if they have misrepresented any of the information contained herein. Supplier further acknowledges that Northrop Grumman shall rely on the information provided by Supplier herein and that if any of the Supplier’s representations herein change during the period of performance; Supplier shall provide immediate written notice to the Northrop Grumman procurement representative and update Supplier certification.

PLEASE SIGN AND RETURN TO NORTHROP GRUMMAN SYSTEMS CORPORATION

COMPANY NAME

CERTIFYING OFFICIAL'S TITLE

NAME

DATE

Revision Date July 1, 2021

Annual Certifications

Global Supply Chain Supplier Certification of Accounting Systems and Controls

Global Supply Chain
Supplier Certification of Accounting Systems and Controls