I Have Three Contracts with Three Different Indirect Rates- Is This a Bad Thing?

Share This:

Small startup companies seem to be always writing grant and contract proposals. Many times these grants and contracts are awarded with different rates and different rate structures. Having varying rate structures and indirect rates could end up costing you money in the long run. All of your company’s revenue producing jobs absorb their proportionate share of the company’s indirect rates. If you measure and bill these rates differently for all of your grants and contracts, you will end up losing money on one if not all of them.

Fixing the problem includes selecting a rate structure that fairly allocates your company’s indirect costs to all of your projects. You will then have to rebudget your grants and contracts to reflect the new indirect rates. The final part of the solution is to make sure your customer is in agreement with your company’s new cost structure.

Ready to Learn More? Speak With A Government Funding Award Expert!
Call Now: 781-862-5170 – or – Schedule A Call

Ed Jameson, CPA, Managing Partner

I’ve been in practice for over 40 years helping our small business clients procure, manage, and survive audits on more than $6 billion in federal government contract and grant funding. We’ve been featured presenters and panel moderators at Tech Connect’s National SBIR/STTR conferences since 2010, and I’ve presented at the DOD’s Mentor Protégé Summit and present regularly for several state and local organizations.