Although every attempt has been made to include the items and computations necessary and the
flexibility to calculate the Federal Acquisitions Regulation (FAR) Overhead Rate, this tool may not
address every unique situation that may exist. Its intended use is to provide guidance as well as a
template to calculate a firm’s overhead rate which may be used in the submission to do business
with PENNDOT, however, the items and calculations are subject to further adjustment by PENNDOT
before approval.
Step 2 Organize your expenses using the categories found in the "OVERHEAD" Tab.
Step 3 Input all your expense balances in the "OVERHEAD" tab's Schedule of General and
Administrative Overhead Rate Computation in the grey portion of the General Ledger
column. PLEASE NOTE THAT CELLS C14 AND C29 ARE LEFT INTENTIONALLY BLANK.
Step 4 In the lower portion of the "OVERHEAD" tab, reconcile all your General and
Administrative expenses by inputting the amounts in the grey for Net Revenue, Direct
Labor, Net Income and Interest Income(if any). If there is a difference, there may be
an expense incorrectly inputted or missing.
Step 6 Ensure that your trial balance reconciles to your submitted overhead rate schedule.
Include the trial balance with your submission. Should you need further guidance on
what a trial balance is, see the definition provided in the Definitions tab or an
example has been provided on the Trial Blance tab. The provided example only
indicates the debit or credit balance an account will typically have. Ensure that you
have completed the trial balance using your financial information. In addition, ensure you
have completed the AASHTO Internal Control Questionnaire and have attached the
requested information.
Step 7 In the "CALC" tab, input in the "ENTER TOTAL PAYROLL HERE" grey portion your
total gross payroll for the reported fiscal year ending.
Step 8 In the "Field Expenses" tab, fill out the "Schedule of Segregated Field Expenses"
Click on Tools then Macros then Security to see what your security level is set at.
If security level is set on:
LOW….then you can use the print buttons(escape out of the dialogue boxes
so you can print)
Instructions for calculating your FAR Overhead Rate
MEDIUM…then you can use the print buttons but when doing so a dialogue
box pops up to which you must click on "ENABLE MACROS"
HIGH or VERY HIGH….then you CAN NOT use the print buttons unless
you change your security setting to MEDIUM and
then follow the MEDIUM security level instructions
YOU SHOULD RETURN YOUR MACRO SECURITY
SETTING TO ITS ORIGINAL SETTING
To print, click on the appropriate button to generate the Overhead Report that you
need to submit. The Overhead Report that will be submitted to PENNDOT Consultant
Agreements consists of the Cover Page(Cover tab), Schedule of General and
Administrative Overhead Rate Computation(Overhead tab), Allocation Calculations(Calc
tab)…FOR DUAL RATE SUBMISSIONS ONLY and the Notes of the Exclusions to the
Schedule of General and Administrative Overhead Rate Computation(Notes tab).
USEFUL LINKS
DCAA
Automobile Include lease payments, automobile rentals, gas, registrations, repair and
maintenance and parking
Building Maintenance Includes ongoing maintenance, landscaping and upkeep services, repairs, etc.
Cognizant Audit Developed to assign primary responsibility for an audit to a single entity
(the “cognizant agency”) to avoid the duplication of audit work performed
in accordance with Government Auditing Standards to obtain reasonable
assurance that claimed costs are accordance with the FAR Subpart 31.2
cost principles. Such audit work may be performed by home-state auditors,
a Federal audit agency, or a non-home State auditor designated by the
home-State auditor.
Computer Support Services Include automated payroll service, non-capitalized software costs(licenses
and maintenance), computer(harddrives, monitors, printers, scanners, etc.)
rentals and computer support(outside technical support)
Consulting Outside professionals services(i.e. medical broker, real estate broker and
other specialty advisors[i.e. brokers, promoters, organizers, management
consultants and investments counselors in relation to company
organization/reorganization costs])
Direct Costs Any cost that is identified specifically with a particular final cost objective.
Costs that can be identified specifically with a contract are direct costs.
Page 3 of 15
General Ledger Components for FAR Overhead Rate Calculation
Dues and Subscriptions Includes professional memberships, licenses and registrations and
professional publications, books and subscriptions and private club dues
Entertainment Fees, travel and related expenses for golf outings, football, baseball games
and other similar sporting events, which includes meals and/or alcohol.
All alcohol expenses with meals, holiday parties and similar expenses.
Facilities Capital Cost of Money(FCCM) In accordance with Department letter dated 12/3/03, the Department only
accepts FCCM as a component of ownership cost when evaluating cost
of ownership in accordance with Chapter 31 of the Federal Acquisition
Regulations for rent of office space between organizations under
common control.
Group Insurance Includes employee group life, medical and any life insurance policies
for the company and/or its employees(includes key man). Key man
insurance expense can be adjusted by any gain or loss from the
cash surrender value of that policy
Indirect Costs After direct costs have been determined and charged directly to the contract
or other work, indirect costs are those remaining to be allocated to
intermediate or two or more final cost objectives. No final cost objective shall
have allocated to it as an indirect cost any cost, if other costs incurred for
the same purpose, in like circumstances, have been included as a direct
cost of that or any other final cost objective.
Page 4 of 15
General Ledger Components for FAR Overhead Rate Calculation
Insurance Includes professional and general( which covers auto, property, worker's
comp., umbrella, etc.) liability policies
Legal and Accounting Includes legal, audit and accounting services from law or CPA firms
Also includes organization/reorganization costs(incorporation fees,
cost for attorneys and accountants)
Meetings and Seminars Annual company service award ceremony(exclude alcohol costs), training
and conference expenses. Includes mileage, hotel, airfare, car rental,
meals, etc.
Office and Miscellaneous Includes furniture, copier and phone leases. Janitorial,
office supplies, penalties(i.e. late filings), bad debts and bank
service charges.
Other Equipment Rentals & Maintenance Include any rentals and maintenance other than office space, computer
related and office related equipment(i.e. out of office equipment)
Other Supplies Includes supplies other than office and data processing(i.e. out of office
supplies for traffic count materials and other non-specific expenses
to perform outside the office activities).
Rent
Retirement Benefits Includes 401(k) with employer matching and employer profit sharing
contributions as well as pensions and other retirement benefits
Also includes plan administration.
Page 5 of 15
General Ledger Components for FAR Overhead Rate Calculation
Supplies Reproduction and technical supply costs associated with the preparation,
production and submission of proposals. Includes products and services by
outside vendors to include specialty papers including bond, color copies,
printing, binding materials, traffic count materials, foam board, photographs,
aircraft rental, video production, etc. Also includes data processing supplies
Taxes, Other Than Income Includes sales tax, business privilege, capital stock tax and any gross
receipt tax payments
Travel Travel costs associated with proposal preparation. This includes meetings
between offices and those to presentation sites. These costs are specific to
a proposal. Includes mileage, hotel, airfare, car rental, meals, etc.
Travel costs associated with travel between offices for meetings of a general
nature, not specific to any proposal, training, conference or billable job.
Also included are work share meetings and associates conferences.
Includes mileage, hotel, airfare, car rental, meals, etc.
Trial Balance A list of all accounts in the ledger and their balances. The profit and loss
statement and balance sheet and other financial reports can be prepared
using the account balances from the trial balance. The submitted trial
balance should reconcile to the submitted overhead rate schedule and will
include the detailed accounts included on the submitted overhead rate
schedule.
Utilities
Page 6 of 15
Exclusion Worksheet
Exclusions: Answer all bolded statements. If one doesn't apply, leave blank.
Enter any costs associated with souvenirs, models, imprinted clothing, buttons
and other mementos provided to customers or to the public and costs
directly associated with trade shows, including labor and fringe benefits. Enter total here…………….
Enter company vehicle(s) with their corresponding Fair Market Value and Personal Use %(Whole Number).
Total………………………………………………………………………………………………………………………. 0
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Total………………………………………………………………………………………………………………………. 0
(7) To exclude amortization of Goodwill per FAR 31.205-49. Enter total here…………….
(8) To exclude private club dues per FAR 31.205-13. Enter total here…………….
(10) To exclude key man insurance per FAR 31.205-19. Enter total here…………….
(15) To exclude bad debts per FAR 31.205-3. Enter total here…………….
(17) To exclude excess rent over the normal costs of ownership when
property is rented from an entity under common control per FAR 31-205-36. Enter total here…………….
(18) To exclude federal income taxes per FAR 31.205-41. Enter total here…………….
ABC, INC.
Schedule of Segregated Field Expenses
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2006
You must enter an amount for Direct Labor from field personnel.
If none, enter "0" and skip to the next step.
Direct Labor
Advertising
Automobile Expense(Including Lease Payments)
Bonuses
Building Maintenance
Computer Support Services
Consulting
Contributions
Depreciation
Dues and Subscriptions
Entertainment
Group Insurance
Insurance
Legal and Accounting
Meetings and Seminars
Other Equipment Rentals & Maintenance
Other Fringe Benefits
Payroll Taxes
Postage, Printing and Stationery
Recruiting Fees
Retirement Benefits
Salaries-Administrative
Salaries-Technical, Indirect
Taxes-Income
Taxes, Other Than Income
Telephone
Travel
Utilities
Direct Labor
Advertising 0
Automobile Expense(Including Lease Payments) 0
Bonuses 0
0
Building Maintenance
Computer Support Services
Contributions 0
Depreciation 0
Dues and Subscriptions 0
Entertainment 0
Facilities Capital Cost of Money(FCCM)
Group Insurance 0
Insurance
Interest 0
Legal and Accounting 0
Marketing 0
Meetings and Seminars
Office and Miscellaneous 0
0
Office Machine Maintenance
Other Equipment Rentals & Maintenance
Other Fringe Benefits 0
Payroll Taxes
Postage, Printing and Stationery
Recruiting Fees
Rent 0
Retirement Benefits
Salaries-Administrative
Salaries-Technical, Indirect
Supplies
Taxes-Income 0
Taxes, Other Than Income
Telephone
Travel
Utilities
Vacation, Sick Leave, Holiday
Total
When expenses can be specifically (directly) identified to field or office this is how they should be allocated
OFFICE
Direct Labor (OFFICE) = = =
Total Direct Labor
FIELD
Direct Labor (FIELD) = = =
Total Direct Labor
FAR
Total Labor(Payroll) =
Paid Leave =
Indirect salaries exclusive of paid leave =
Direct labor (FIELD) percentage =
FIELD
Allocated support service labor = (Indirect salaries exclusive of paid leave) * (Direct labor FIELD percentage)
=
=
Total labor exclusive of paid leave and = [(Total Labor) - (Paid Leave) - (Direct Labor FIELD)]
direct labor (FIELD)
=
OFFICE
ABC, INC.
NOTES OF THE EXCLUSIONS TO THE SCHEDULE OF
GENERAL AND ADMINISTRATIVE OVERHEAD RATE COMPUTATION
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2006
Below are a list of various exclusions that may apply to the Schedule of General and Administrative
Overhead Rate Compensation and are noted as such:
(17) To exclude excess rent over the normal costs of ownership when
property is rented from an entity under common control per FAR 31-205-36.
ABC, Inc.
Trial Balance
As of December 31, 2010