Guide

Cost Allowability: What Government Contractors Need to Know

Cost Allowability: What Government Contractors Need to Know

Pages 12 Pages

This guide explains cost allowability principles under FAR Part 30 and FAR Part 31. It defines allowable, allocable, reasonable, and expressly unallowable costs, and explains how misclassification can lead to audit findings and penalties. The ebook discusses documentation requirements, DCAA oversight, and common cost risk areas such as labor, travel, and indirect expenses. It emphasizes consistent policies and system controls to ensure compliance. Understanding cost allowability helps contractors protect margins and remain audit-ready.

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