The Small Business Administration issues certificates of competency to small businesses bidding on government contracts to demonstrate their ability to fulfill the contract. The SBA reviews criteria such as tenacity, credit, and integrity, and also collects financial and equipment information from the business. The SBA sends a team to assess the company’s capabilities and issues the certificate if approved.
A certificate of competency is issued by the Small Business Administration (SBA) to demonstrate that a small business is capable of fulfilling the contract. The certificate is required in cases where the small business is the highest bidder on a government procurement and the contracting officer in charge of awarding a bid does not believe that the small business can perform the tasks required by the bid. SBA experts examine the company in detail to assess its performance capabilities and issue a certificate of competency which requires the contract to be awarded to the company. Without it, companies that are new to bidding on government contracts may find it difficult to secure contracts from contracting officials who are unsure of their ability to perform. The US Congress has given the SBA the authority to make such decisions for government contracts and to review and issue certificates.
It is up to the small business that has been denied an offer to apply for a certificate of competency with the SBA. Congress has enumerated some of the criteria the SBA should review in determining whether to issue a certificate. These include the firm’s tenacity, credit and integrity. A contracting officer may reject an offer based on any of these criteria, but the offer must be submitted to the SBA for review. The SBA is not limited to just this list and often looks at other criteria to determine the company’s capabilities and level of accountability.
The SBA sends an application for a certificate of competency in accordance with the Small Business Act to those businesses that want to override the contracting officer’s denial. The application is often used to collect financial and other data about the owner of a small business. It includes a cash flow statement form that businesses must complete that lists their assets and liabilities; debts and credits; and a comparative statement of sales, profit and loss. Firms must also provide information about their facilities and equipment to help the SBA review the firm’s ability to perform on the contract. The application concludes with an agreement that the applicant must sign, whereby the business owners agree not to hire any SBA representatives within two years of issuing the certificate and to allow the SBA access to financial and other documents during the execution of the contract.
After the SBA receives your application for a certificate of competency, it begins its reviews of the company and notifies the commissioning officer that it rejected the offer in the first place. The SBA often sends a team of field representatives to assess the company’s capabilities. The team reports its findings to a review committee who will approve or reject the certificate.
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