Cost Allowability

Cost Allowability (Mar 20-21, 2024)

Determining allowable costs for contract pricing or reimbursement purposes can be complicated. FAR Part 31 contains cost principles and procedures for the pricing of contracts, subcontracts, and modifications to contracts and subcontracts whenever cost analysis is performed, and the determination, negotiation, or allowance of costs when required by a contract clause.

This workshop provides a thorough understanding of the nature and intent of FAR Part 31—Contract Cost Principles And Procedures, Subpart 31.2—Contracts with Commercial Organizations. Coverage includes the basic FAR requirements for cost accounting and cost principle application contained in FAR 31.201 through FAR 31.204, as well as a detailed examination and explanation of each contract cost principle contained FAR 31.205. It is recommended for those individuals with responsibility for identifying and coding transactions for cost segregation, for cost accounting, or for management or oversight of the cost accounting functions.

Topics:

• Composition of total cost
• Determining allowability
• Determining reasonableness
• Determining allocability
• Accounting for credits
• Accounting for unallowable costs
• Identifying and segregating direct costs
• Identifying segregating and allocating indirect costs
• Identifying unallowable costs and documenting and supporting allowable costs
• Advance agreements

Instructor: Adam So & Mike Mardesich, FORVIS