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First and Business Class Airfare in the G&A Pool


Go Buckeyes

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First posting, so please forgive me if I'm in the wrong place. This is an accounting question:

When I encounter first and business class airfares in the General and Administrative (G&A) totals to allocate, is the entire airfare expense (a) unallowable? Or (b) just the difference between the paid airfare and the lowest cost airfare at that time?

If the answer is b, can I estimate the lowest cost airfare since there is no historical record to verify?

Thank you!

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The answer is (b). Certainly you can estimate what the lowest standard airfare available during business hours would have been; however, the auditors are going to expect something more than a guess.

Side comment: The title of the inquiry says "First and Business Class Airfare in the G&A Base" but your question talks about "G&A totals to allocate" -- which implies you're discussing the pool, not the base. My response assumes you are asking about pool costs (indirect expenses).

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Don't automatically assume that the airfare costs are unallowable in whole or in part.  This is what FAR 31.205-46 actually says:

 Airfare costs in excess of the lowest priced airfare available to the contractor during normal business hours are unallowable except when such accommodations require circuitous routing, require travel during unreasonable hours, excessively prolong travel, result in increased cost that would offset transportation savings, are not reasonably adequate for the physical or medical needs of the traveler, or are not reasonably available to meet mission requirements. However, in order for airfare costs in excess of the above airfare to be allowable, the applicable condition(s) set forth above must be documented and justified.

Thus, you should do an analysis to determine how this requirement applies in your situation.  After you do so, you may determine that the airfare is allowable.

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  • Go Buckeyes changed the title to First and Business Class Airfare in the G&A Pool
On 3/4/2021 at 8:08 PM, here_2_help said:

The answer is (b). Certainly you can estimate what the lowest standard airfare available during business hours would have been; however, the auditors are going to expect something more than a guess.

Side comment: The title of the inquiry says "First and Business Class Airfare in the G&A Base" but your question talks about "G&A totals to allocate" -- which implies you're discussing the pool, not the base. My response assumes you are asking about pool costs (indirect expenses).

Thank you for the info and for correcting my word mix up of base versus pool. I corrected the title in case that may help others with a similar question. Again, thanks!

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