In GSG’s final podcast of the three-part FAR podcast series, Director of Audit and Accounting Services, John Mahaffey discusses selected areas of cost that are allowable under FAR. Previous episodes included how to determine allowable verse unallowable costs and allowable compensation costs under FAR.
As federal executive agencies and state DOTs prepare their indirect cost rates and prepare for an audit, it’s important to understand whether a cost is allowable under the Federal Acquisition Regulation (FAR). FAR Part 31 – Contract Cost Principles and Procedures includes the regulations for pricing contracts and determining allowable costs for government contracts, and FAR 31.2 specifically deals with contracts with commercial organizations.
While many unallowable costs such as bad debts, penalties, losses on other contracts, and federal income taxes may seem obvious, there are other, more detailed areas of costs under FAR that may cause confusion.
This podcast highlights popular areas when determining allowable costs, including:
- Marketing (public relations and advertising, direct selling, and proposal costs)
- Employee morale
- Employee relocation
For more information, or guidance as your firm prepares indirect cost rate submissions for federal government contractors, contact us here.Categories: Audit & Accounting, Government Contractors