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Understanding the Basics of Federal Acquisition Regulation (FAR)

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If you are new to the government contracting world you have probably heard the acronym FAR thrown around quite a bit. If you are wondering “What does FAR stand for? Who is it’s for? And what does it cover?” then you have come to the right place. First and foremost, FAR stands for Federal Acquisition Regulation, and this document will serve as a sort of Federal Acquisition Regulation cheat sheet where we’ll cover the basics of FAR and what you need to know as you engage in government contracts.

What is Federal Acquisition Regulation?

To ensure that all Government purchases via contracts are uniform and fair, a system of policies and procedures is put in place that nearly all government agencies are required to comply with. This system is known as the Federal Acquisition Regulations System. The Federal Acquisition Regulation (FAR) is the primary document in the system and is basically a guideline that protects (clauses and forms) and directs (requirements and rules) contractors and contractees as they engage in work.


The FAR’s guiding principles are centralized around the effort to -

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  • Satisfy customer’s needs in terms of cost, quality, and timeliness

  • Minimize administrative operating costs

  • Conduct business with integrity, fairness, and openness

  • Fulfill other public policy objectives

Who uses it?

The FAR governs most contracts with the Federal Government. The contractee (Government Agency) will specify the FAR provisions that are applicable to the contract and it is then the contractor’s job to comply with the provisions, demonstrate that they will be able to comply with the provisions at the time of award, or claim exemption from the provisions (ex. Cost Accounting Standards Exemptions).


The FAR is applicable when a contractor responds to a solicitation (IFB, RFP, RFQ, RFI), a contractor receives a federal prime contract, a contractor receives a subcontract under a federal prime contract, or a contractor issues a subcontract under a federal prime contract. When the FAR is applicable, it is the responsibility of the contractor to read and understand the provisions within the contract before signing. It is important to note that most Government Agencies have developed additions to the FAR that are specific to contracts issued out of those agencies. As a contractor you are required to comply with the Agency Supplemental regulations as well as the FAR, but no Agency Supplemental regulations can override the FAR.

Agency Supplemental Regulations

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Defense Logistics Agency

Department of Agriculture Acquisition Regulation (AGAR)

Department of Commerce Acquisition Regulation (CAR)

Department of Defense Federal Acquisition Regulation Supplement (DFARS)

Department of Education Acquisition Regulation (EDAR)

Department of Energy Acquisition Regulation (DEAR)

Department of Health and Human Services Acquisition Regulation (HHSAR)

Department of Homeland Security Acquisition Regulation (HSAR)

Department of Housing and Urban Development Acquisition Regulation (HUDAR)

Department of Justice Acquisition Regulation (JAR)

Department of Labor Acquisition Regulation (DOLAR)

Department of State Acquisition Regulation (DOSAR)

Department of the Air Force Federal Acquisition Regulation Supplement (AFFAR)

Department of the Army Acquisition Regulations (AFAR)

Department of the Interior Acquisition Regulation (DIAR)

Department of the Navy Acquisition Regulations (NMCAR)

Department of the Treasury Acquisition Regulation (DTAR)

Department of Transportation Acquisition Regulation (TAR)

Department of Veterans Affairs Acquisition Regulation (VAAR)

Environmental Protection Agency Acquisition Regulation (EPAAR)

General Services Administration Acquisition Regulation (GSAR)

National Aeronautics and Space Administration Federal Acquisition Regulations Supplement (NFS)

National Science Foundation

Nuclear Regulatory Commission Acquisition Regulation (NRCAR)

Office of Personnel Management Federal Employees Health Benefits Acquisition Regulation (FEHBAR)

Office of Personnel Management Federal Employees’ Group Life Insurance Federal Acquisition

Social Security Acquisition Regulation (SSAR)

U.S. Agency for International Development Acquisition Regulation (AIDAR)

What does it cover?

The FAR is organized into 8 subchapters, A through H, which contains 52 parts that cover everything from general information to clauses and forms. The most heavily regulated aspect of acquisitions is contract pricing. The FAR addresses contract pricing throughout its entirety, but especially in Subpart 15.4, Parts 30 and 31, and Subparts 42.7, 42.8, and 42.17. Another large section of the FAR is Subchapter D: Socioeconomic Programs, which covers various small business programs, purchases from foreign sources, and laws written to protect those working under government contracts. While it is important to comply with and understand the FAR as a whole, it is paramount to be thoroughly knowledgeable in Parts 31 – Contract Cost Principals and Procedures, and 52 – Solicitation Provisions and Contract Clauses. A comprehensive understanding of these sections will ensure that you are able to correctly allocate and record costs and abide by all contract provisions.

federal acquisition regulation book

Contract Administration & Compliance with CRI

This may all seem like a lot to take in, but doing business with the government requires the understanding of and compliance with a very strict set of rules. If you are looking for some guidance, our federal acquisition services provide the support you need to confidently do business with the government. We use contract management best practices, combined with over 30 years of government contracting experience to ensure our customers are FAR compliant and optimizing their results. Staying on top of government regulations is a full-time job, and one we want to take out of your hands so you can focus on what you do best. Let our experts keep track of Federal Acquisition Regulation news and ensure your contracts meet all requirements and benefit you. Check out our Contract Administration and Compliance services to learn more, and feel free to reach out to schedule a meeting or just gather more information from our team.


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