Which characteristic applies to performance payment in a Cost Reimbursement Contract?

In the context of a Cost Reimbursement Contract, performance payment typically occurs when specific performance criteria or incentives are met. This characteristic is crucial because the essence of a Cost Reimbursement Contract is to cover the allowable costs incurred during the contract execution while providing a certain level of payment tied to performance standards.

Thus, performance payments are not guaranteed merely by the act of completing a delivery, as seen in other contract types where payment may occur upon fulfillment of contract terms. Instead, they hinge on meeting predetermined performance metrics or incentives set forth in the contract. This ensures that the contractor is not just reimbursed for costs, but is also motivated to achieve certain performance levels, thus aligning the contractor's efforts with the objectives of the government or contracting entity.

It's important to note that while some contracts might include milestone completions or guaranteed payments, these features do not reflect the nature of performance payment specifically in a Cost Reimbursement context as effectively as the link to incentives does. Therefore, understanding contract types and their specific payment characteristics is key to performing effectively in contracting roles.