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Similarities between Cost reimbursable and Time and Material Contract

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rajatahaali
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Similarities between Cost reimbursable and Time and Material Contract

Postby rajatahaali Fri Apr 07, 2017 10:34 am

I attempted a question regarding similarities between Cost Reimbursable and Time and material contract . I chose that In both buyer pay the actual expense occurred by seller. However this was marked as incorrect . Correct option was that both donot have definite end . I have some confusion is this regard . What does a definitive ending means , If i have hired somebody for two weeks in TIme and material contract then this contract will end after two weeks . Yes in terms of cost reimbursable i can say that i dont know when project will be completed since its mostly used in research projects . Can you please explain why my answer was incorrect and how the second option was correct.
manishpn
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Re: Similarities between Cost reimbursable and Time and Material Contract

Postby manishpn Sat Apr 08, 2017 8:51 am

rajatahaali wrote:I attempted a question regarding similarities between Cost Reimbursable and Time and material contract .
I chose that In both buyer pay the actual expense occurred by seller.
Yes this is true in both the contract and there are mechanism for the buyer to verify the claims before approving the actual expenses
However this was marked as incorrect . Correct option was that both donot have definite end .
This is not true, as especially for T and M contract there is a time duration in contract which can ofcourse be extended, but T and M contract can also be a evergreen (without an end date contract) and can have a Cap on the contract amount,
I would like to see the question before helping you further

I have some confusion is this regard . What does a definitive ending means , If i have hired somebody for two weeks in TIme and material contract then this contract will end after two weeks . Yes in terms of cost reimbursable i can say that i dont know when project will be completed since its mostly used in research projects . Can you please explain why my answer was incorrect and how the second option was correct.
Br,
Manish P
PMP, PMI - ACP, SAFe Agilist
http://www.izenbridge.com/blog/7-effect ... ification/
rajatahaali
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Posts: 23
Joined: Thu Mar 30, 2017 9:47 am

Re: Similarities between Cost reimbursable and Time and Material Contract

Postby rajatahaali Sun Apr 09, 2017 10:53 am

Dear Manish , this was a question is assessment of izenbridge. i am posting the question for reference :

What similarity exists between ” cost-reimbursable” and “ time and material” types of contract?

a.They have no definitive end.
b.The closure date is part of the contract.
c. Both recommend fixing the cost upfront.
d. In both buyer pay the actual expense occurred by seller.

I chose answer d . This was marked incorrect and option a was marked as correct. Solution given was as follows.

"Time and material contracts resemble cost-reimbursable type arrangements in that they have no definitive end, because the full value of the arrangement is not defined at the time of the award."
manishpn
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Re: Similarities between Cost reimbursable and Time and Material Contract

Postby manishpn Mon Apr 10, 2017 7:48 pm

thanks need to check with team on this question
Br,
Manish P
PMP, PMI - ACP, SAFe Agilist
http://www.izenbridge.com/blog/7-effect ... ification/

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