In computing such receipts or accruals we have excluded exempt sales, including those referred to in paragraph 7 below, brokerage commissions and other income under subcontracts described in section 103 (g) (3) of the act (Brokers and manufacturers' agents: Disregard this paragraph. See paragraph 2 below).

2. We declare that brokerage commissions and other income, if any, received or accrued by us (together with those of all below-listed persons, firms or corporations under control of or controlling or under common control with the undersigned), under subcontracts described in section 103 (g) (3) of the act, did not exceed $25,000, or the prorated amount thereof, for our fiscal year ended

year)

(Insert month, day, and We estimate that such receipts or

accruals aggregated $.

(Insert amount)

3. We represent that we do not expect to receive or accrue any further amounts subject to renegotiation which will bring total receipts or accruals, for the fiscal year involved, above the $1,000,000 floor or the $25,000 floor, or the prorated amount thereof.

4. The following persons, firms or corporations, and no others, controlled or were under control of or under

5. Method of accounting employed: Federal tax return: Cash (0) Accrual (□) Completed contract ().

This report: Cash (□) Accrual (□) Completed contract ().

6. Our gross sales or gross receipts reported for Federal income tax purposes were $---‒‒‒‒

7. The Standard Commercial Article Exemption: Has not been self-applied by us () Has been selfapplied by us (□) (to otherwise renegotiable sales) in the estimated amount of $-See instructions on reverse side.

8. In submitting this statement, we are aware that Section 105 (e) (1) of the Act provides in part as follows: "*** Any person who willfully fails or refuses to furnish any statement, information, records, or data required of him under this subsection, or who knowingly furnishes any such statement, information, records, or data containing information which is false or misleading in any material respect, shall upon conviction thereof, be punished by a fine of not more than $10,000 or imprisonment for not more than one year, or both."

INSTRUCTIONS

(Read with particular reference to Paragraph 7, Standard Commercial Article Exemption)

The Renegotiation Act of 1951, as amended, under certain conditions exempts amounts received or accrued in fiscal years ending after June 30, 1956 (other than brokerage commissions or other similar income), under contracts or subcontracts for any of the following items:

1. A standard commercial article;

2. An article which is identical in every material respect with a standard commercial article;

3. An article in a standard commercial class of articles;

4. A standard commercial service;

5. A service which is reasonably comparable with a standard commercial service.

The exemption of Item 1 above may be applied by the contractor itself, without application to the Board. With respect to the other 4 items above, the contractor's sales thereof are not exempt unless the contractor has filed an Application for Commercial Exemption with The Renegotiation Board and such application has been granted. (The terms used herein are defined in section 106 (e) of the act).

In determining whether you are entitled to use the form on the reverse side, the following rules should be observed (see RBR 1467.22 (e)):

(a) If renegotiable receipts or accruals are $1,000,000 or less (including sales of Items 1 through 5 above), you may use this form but do not submit an Application for Commercial Exemption.

(c) If renegotiable receipts or accruals are $1,000,000 or less only when sales of Items 2 through 5 above are excluded, you may submit an Application for Commercial Exemption to support claim for exemption, but you may not file this form until the Board has completed action on such application.

(d) If renegotiable receipts or accruals are more than $1,000,000 (exclusive of sales of Items 2 through 5 above), do not use this form but use Standard Form of Contractor's Report (RB Forms 1 and 1B) for such receipts or accruals, and file an application for Commercial Exemption to support claim for exemption. (e) In addition to the foregoing, in computing renegotiable receipts or accruals, amounts received or accrued under all other prime contracts or subcontracts exempted by the act or by The Renegotiation Board should be excluded in all cases. If an Application for Commercial Exemption has previously been submitted and denied, sales covered thereby should be included.

If each member of an affiliated or related group is entitled to file a Statement of Non-Applicability pursuant to Section 105 (e) (1) of the act, such group may, if it so elects, file a consolidated Statement of Non-Applicability: Provided, That the fiscal years of all members of such group begin and end respectively on the same dates. This means that a consolidated Statement of Non-Applicability may be filed when the sum of the renegotiable sales of all members of the group is less than the applicable minimum amount prescribed in Section 105 (f) (1) or (2) of the act. (If used, this form should be filed in duplicate with The Renegotiation Board, Washington 25, D. C.) (A separate statement should be filed for each fiscal year or period for which this form is used)

Sec.

1471.4 Reassignment to Board.

AUTHORITY: Sections 1471.1 to 1471.4 issued under section 109, Pub. Law 9, 82d Cong. Interpret or apply section 107, Pub. Law 9, 82d Cong.

1471.1 When assignment is made.-After receipt of a Standard Form of Contractor's Report from a contractor, the Board will assign the case to a Regional Board for renegotiation if it determines that further proceedings in the matter are warranted. No assignment will be made when the Board can readily decide on the basis of the information contained in the Standard Form of Contractor's Report that the contractor has not realized excessive profits for the fiscal year and that no purpose would be served by making an assignment to a Regional Board. If the Board decides not to make an assignment, the Board will notify the contractor to this effect. See § 1498.6 (c) of this subchapter.

1471.2 How assignment is made.-(a) An assignment may be made to a Regional Board on some basis other than geographical in an appropriate case when it is believed that such assignment will promote efficiency in the renegotiation procedure. Similarly, the Board will reassign a case from one Regional Board to another if it appears that efficiency of renegotiation procedure will be promoted thereby.

(b) At the time of assignment, every case will be designated by the Board as either a Class A case or a Class B case. Generally, a Class A case will be one in which the contractor reports on the Standard Form of Contractor's Report that it has derived from subject contracts profits of more than $800,000 and a Class B case will be one in which the contractor reports on the Standard Form of Contractor's

Report that it has derived from subject contracts profits of $800,000 or less. Cases assigned on and after September 18, 1954, will be designated in accordance with the preceding sentence; cases previously assigned will generally be redesignated in accordance therewith upon request of the Regional Board if not already concluded by clearance notice, agreement or order, and if such redesignation is otherwise expedient. The Board has delegated to the Regional Boards authority (1) in Class A cases, to make recommended determinations of excessive profits to the Board for final determination by the Board, and (2) in Class B cases, to make final determinations of excessive profits. (See sec. 1499.50 of this subchapter.)

(c) The Regional Board to which the case is assigned will notify the contractor of the assignment and will also advise the contractor whether the case is a Class A case or a Class B case.

(d) Except in cases governed by paragraph (e) of this section, with respect to contractors whose receipts or accruals are wholly or predominantly under subcontracts described in section 103 (g) (3) of the act, a Class A case will generally be one in which the contractor reports on the Standard Form of Contractor's Report that its aggregate of such receipts or accruals is $100,000 or more and a Class B case will be one in which the contractor reports on the Standard Form of Contractor's Report that its aggregate of such receipts or accruals is less than $100,000. Cases assigned on and after September 18, 1954, will be designated in accordance with the preceding sentence; cases previously assigned will generally be redesignated in accordance therewith upon request of a Regional Board if not already concluded by clearance notice, agreement or order, and if such redesignation is otherwise expedient,

421

(e) Notwithstanding the foregoing, to facilitate concurrent renegotiation of members of affiliated or related groups when not consolidated (see § 1464.10 of this subchapter), renegotiable members of any such group will generally all be designated at the time of assignment as Class A or Class B cases according to the proper designation of the member having the largest amount of profits from subject contracts for the fiscal year under review.

(f) Any case initially designated as a Class A or a Class B case according to the amounts reported on the Standard Form of Contractor's

Report may, but will not necessarily, be redesignated if further information developed after assignment establishes that the contractor's renegotiable profits, or its renegotiable receipts or accruals, as the case may be, are sufficiently larger or smaller than the amount reported, to make such redesignation appropriate.

1471.3 Reserved.

1471.4 Reassignment to Board.-A case will be reassigned from a Regional Board to the Board in the circumstances set forth in section 1472.4 of this subchapter.

Sec.

1472.1 Statutory provision.

1472.2

Commencement of renegotiation.

1472.3 Conduct of renegotiation by Regional Board. 1472.4 Conduct of renegotiation by Board.

1472.5 Filing of information and requests by contractor.

AUTHORITY: Sections 1472.1 to 1472.5 issued under section 109, Pub. Law 9, 82d Cong. Interpret or apply section 105, Pub. Law 9, 82d Cong.

1472.1 Statutory provision.-Section 105 (a) of the act provides in part as follows:

Renegotiation proceedings shall be commenced by the mailing of notice to that effect, in such form as may be prescribed by regulation, by registered mail or by certified mail to the contractor or subcontractor. The Board shall endeavor to make an agreement with the contractor or subcontractor with respect to the elimination of excessive profits received or accrued, and with respect to such other matters relating thereto as the Board deems advisable. Any such agreement, if made, may, with the consent of the contractor or subcontractor, also include provisions with respect to the elimination of excessive profits likely to be received or accrued. If the Board does not make an agreement with respect to the elimination of excessive profits received or accrued, it shall issue and enter an order determining the amount, if any, of such excessive profits, and forthwith give notice thereof by registered mail or by certified mail to the contractor or subcontractor. In the absence of the filing of a petition with The Tax Court of the United States under the provisions of and within the time limit prescribed in section 108, such order shall be final and conclusive and shall not be subject to review or redetermination by any court or other agency. * [Matter in italics added by Pub. Law 86-507, 86th Cong., approved June 11, 1960.]

1472.2 Commencement of renegotiation.Renegotiation proceedings will be commenced by mailing a notice to that effect by registered mail to the contractor. Ordinarily, renegotiation proceedings will not be commenced until after the contractor has filed a Standard Form of Contractor's Report and the case has been assigned to a Regional Board for renegotiation. (See sec. 1471.1 of this subchapter.) After such assignment, renegotiation will be conducted in the manner outlined in this part,

except that if the contractor has failed or refused to file a Standard Form of Contractor's Report or other necessary information, records, or data requested by the Board, or by the Regional Board to which the case is assigned, any of the steps outlined in this part may be omitted, combined, accelerated or otherwise modified in such manner as may be considered necessary or appropriate to protect the interests of the Government in the particular circumstances.

§ 1472.3 Conduct of renegotiation by Regional Board. (a) Submission of additional information; preliminary meetings. After a case has been assigned to a Regional Board for renegotiation, the Regional Board personnel assigned to the case will examine the Standard Form of Contractor's Report submitted by the contractor and will determine what additional information is needed. When necessary, a preliminary meeting or meetings will be held with the contractor to discuss the information and data to be submitted by the contractor and the manner in which it is to be submitted. The contractor shall also be entitled in any case to submit, and in cases deemed appropriate will be invited to submit, a statement setting forth such further information, data, and representations as it may desire to have taken into consideration. under the factors prescribed in section 103 (e) of the Act, and explained in Parts 1460 and 1490 of this subchapter. A reasonable opportunity will be provided for the submission of any information, data or representations that the contractor may be requested or invited to submit.

(b) Disputed issues. Before submission of the Report of Renegotiation to the Regional Board pursuant to paragraph (d) of this section, the Regional Board personnel assigned to the case will endeavor to resolve with the contractor any issues or disputed matters of fact, law or accounting. Upon its request, the contractor will be afforded a reasonable oppor