FAR Overhead Audits

FAR Part 31 Overhead Audits for A&E Firms

Expert Compliance. Optimized Rates.

For Architecture, Engineering, and Construction firms, securing government contracts requires more than just technical talent. It requires a certified, defensible overhead rate. Superstein PA provides specialized FAR Overhead Audits, compliant with the American Association of State Highway and Transportation Officials (AASHTO). We help firms across the country navigate the rigorous pre-qualification standards of Federal agencies and State Departments of Transportation (DOTs).

Our Audit Standards include:

  • FAR Part 31 Compliance: Ensuring all costs are allowable and reasonable under federal contract cost principles.
  • GAGAS (Yellow Book) Standards: Providing the highest level of audit reliability required by most government agencies.
  • AASHTO Uniform Audit & Accounting Guide: Meeting the gold standard for DOT pre-qualification nationwide.

Ready to Secure Your Defensible Overhead Rate?

Complete the form below to see if your firm qualifies for our specialized overhead review.

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From “Safe Harbor” to Fully Audited Rates

Many growing firms start with “Safe Harbor” rates, but as you scale, a standardized rate can limit your recovery of legitimate indirect costs. We help firms transition to fully audited overhead rates that reflect the true cost of doing business, ensuring you aren’t leaving money on the table during the bidding process.

Frequently Asked Questions:

What is a FAR Overhead Audit?

A FAR Overhead Audit is an examination of a firm’s indirect cost rate to ensure compliance with Federal Acquisition Regulation (FAR) Part 31. This audit is typically required for A&E firms to pre-qualify for government contracts with State DOTs and federal entities.

Why is this audit necessary?
Most state DOTs require an independent CPA audit of the overhead rate to allow for reimbursement on cost-plus-fixed-fee contracts.
Why should an engineering firm move away from Safe Harbor rates?
Safe Harbor rates are often lower than a firm’s actual overhead. By moving to a certified indirect cost rate, firms can often justify higher overhead recovery, leading to increased profitability on cost-plus contracts.
What are common unallowable costs that must be excluded?
Commonly disallowed expenses include alcohol, entertainment, interest expense, political contributions, promotional advertising, and bad debt.
What is the deadline for the audit?
Most states require the audit to be completed and submitted annually, generally no later than 180 days after the firm’s fiscal year-end.
What is the difference between marketing and Bid & Proposal (B&P) costs?
Under FAR 31, marketing is generally unallowable, while B&P costs are considered allowable indirect expenses, making proper classification crucial for your rate.