These costs are allowable to the extent that they would have been allowable if incurred after the date of the contract (see 31.109). If the contractor does not have such a formal written policy, the cost of premiums for insurance coverage in excess of the acquisition cost of the insured asset is unallowable. For purposes of applying the provisions of this subsection, the Government considers insurance provided by captive insurers as self-insurance, and charges for it shall comply with the provisions applicable to self-insurance costs in this subsection.
Instead, you are simply breaking the calendar year into 13 periods instead of 12. With a 13-month accounting period, you create an artificial month (aka a “13th” month). During the 13th month, you account for things like bad debt, write offs, and other income. If you’ve heard of a 13-month accounting period, you might be thinking it’s the same as having 13 accounting periods.
General Ledger (GL) Processes
This amount would include expenses such as depreciation, maintenance, taxes, and insurance. Other necessary and reasonable expenses normally incident to relocation, such as the costs of canceling an unexpired https://kelleysbookkeeping.com/ lease, transportation of personal property, and purchasing insurance against loss of or damages to personal property. The cost of canceling an unexpired lease is limited to three times the monthly rental.
The cost adjustment must normally be made on an aggregate basis for all affected Federal awards through an adjustment of the IHE’s future F&A costs rates or other means considered appropriate by the cognizant agency for indirect costs. Under the terms of CAS covered contracts, adjustments in the amount of funding provided may also be required when the estimated proposal costs were not determined in accordance with established cost accounting practices. For contracts other than those subject to paragraph of this section, the base period Purpose & Perks Of Your Business Having 13 Accounting Periods for allocating indirect costs shall be the contractor’s fiscal year used for financial reporting purposes in accordance with generally accepted accounting principles. The fiscal year will normally be 12 months, but a different period may be appropriate (e.g., when a change in fiscal year occurs due to a business combination or other circumstances). Value Added Tax Foreign taxes charged for the purchase of goods or services that a non-Federal entity is legally required to pay in country is an allowable expense under Federal awards.
202 Direct costs.
A calendar year or economic year is an accounting length, a hard and fast length in which accounting sports are performed, collected, and analysed. Accounting period provides business owners the perspective about the profitability of the business on an ongoing basis and helps them make informed business decisions. So, the next time you are overwhelmed because of your business records and feel a weird urge to pull your hair out, it might just be a 12-month calendar problem. By using the 13-period calendar in your business, you ensure sales comparability year-on-year, as the layout of the calendar lines up holidays, and ensures the same number of Saturdays and Sundays in comparable periods.