Sorry for setting off such a firestorm ...really expected this to be any easy question and answer, and just looking for clarification. The contract was PROPOSED using labor categories AT hourly rates for computation of total costs. The Contract does not stipulate hourly rates/labor categories for billing only outlines total costs in a whole dollar amount and fixed fee in a whole dollar amount. However, rates/labor categories/hours are required in a monthly financial report prepared for the customer. Again, I will try to make it clearer what I am trying to ask ... an employee is salary exem