304.03

Northern Arizona University
Purchasing Policy and Procedure

Cost Analysis

POLICY:

Purchasing Services is responsible for determining prices paid for goods and services are reasonable. Purchasing Services buyers will review each procurement to ensure the prices paid are reasonable.

COST ANALYSIS

SMALL DOLLAR VALUE PROCUREMENTS:

For small dollar value procurements, the buyer will review:

1. Current market prices,



2. State of Arizona or General Services Administration (GSA) price schedules,
   
   -or-
   
   
3. Prices previously paid.

SOLE SOURCE ITEMS:

For sole source items, the buyer will request a written quotation from the sole source vendor. A statement shall be required on the quotation form that the price quoted for the commodity is the same as, or lower than, normally charged to educational institutions. The buyer also will:

1. Compare the price lists of similar equipment manufacturers.
   
   -or-
   
   
2. Refer to a previously determined target price.

If quoted price is not considered reasonable, the buyer will request detailed cost/pricing data breakdowns from the vendor.

DOCUMENTATION:

The contract file for procurements costing more than $35,000 must include a statement that the buyer has reviewed the quoted prices and considers the price reasonable.