Retredfed & Neil - As for an audit, because you are dealing with an FFP SLIN, that SLIN would not be subject to audit under the standard FAR audit clause, 52.215-2, regardless of the prime contract type. - does this mean that even if the subcontractor submitted their proposal to us as a certified cost or pricing proposal it is still not subject to an audit (under letter c of that same clause since it was FFP? I think that Neil alluded to this fact) That was not my complete understanding of that clause, but if that is true, then my worry over this situation is for nothing. By the way, we are not the Prime for this contract, we are a second tier - but this clause 52.215-2 was flowed to us in our contract. I was worried about how this was priced during the proposal phase which is was why I questioned how the supplier first proposed the travel costs and was told at the time that they only charged actuals but had to propose estimated travel costs. Assuming that all travel would be taken, this is fine and per the FAR requirements. But, if the travel is not taken, the actuals can not be priced and charged, so the travel costs are not accurate per the FAR on the final invoice, so we are not in compliance, in my view.