SpartanHead Posted January 8, 2013 Report Share Posted January 8, 2013 I just started working with a new company and I think they are applying their subK burden wrong. They are only applying the G&A cost on the subK burden costs and not the actual subcontract costs also. Isn't it allowable to apply G&A ontop of the SubK costs+ the SubK burden costs? example SubK total cost $100 SubK burden 5% = $5 G&A 10% What should the total cost be? I think it should be $115.5 Link to comment Share on other sites More sharing options...
FAR Fetched Posted January 9, 2013 Report Share Posted January 9, 2013 Are you the Prime or a tier sub? If you're the Prime, what type of contract is it? What type of contract is the Subcontract? Is the Prime contract subject to full or modified CAS? Link to comment Share on other sites More sharing options...
FAR Fetched Posted January 9, 2013 Report Share Posted January 9, 2013 Also - I'm assuming the contract doesn't speak to this since you're asking. Does your proposal describe your cost build up and was it incorporated by reference? Link to comment Share on other sites More sharing options...
Navy_Contracting_4 Posted January 9, 2013 Report Share Posted January 9, 2013 It really depends on the company's accounting practices. How was the projected 10% G&A rate calculated? Were projected subcontract costs included in the projected base? If so, then I would say you are right. They must be consistent in estimating and accumulating costs. Link to comment Share on other sites More sharing options...
Whynot Posted January 9, 2013 Report Share Posted January 9, 2013 Sounds like your new company may be using a value-added cost base whereby material and subcontract costs are removed from the base used when G&A expenses pertain more to the contractor’s in-house activities than to material and subcontract activity. Link to comment Share on other sites More sharing options...
SpartanHead Posted January 9, 2013 Author Report Share Posted January 9, 2013 We are the prime and the contract is CPAF. SubK is CPAF also. Thanks for the replies, all. Link to comment Share on other sites More sharing options...
SpartanHead Posted January 9, 2013 Author Report Share Posted January 9, 2013 Whynot had the correct answer. Thanks again! Link to comment Share on other sites More sharing options...
govtacct02 Posted January 10, 2013 Report Share Posted January 10, 2013 SpartanHead, I would add to the previous comments that since you are new to your company, you could benefit from an appointment with your Government Accounting department. They can explain the cost structure, the burdening sequence, and alert you with any other items that are pertinent to your position there. I always make a point to spend time with new people and provide them with all the tools they need to be compliant! Link to comment Share on other sites More sharing options...
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