The G&A
Indirect Rate

How General & Administrative Costs Are Pooled, Allocated, and Applied Across Every Contract
G&A
Final Indirect Pool
What-If
Scenario Modeling
3
Allocation Bases
B & E
Key Schedules
01 — Fundamentals
What Is the G&A Rate?
The General & Administrative rate captures company-wide management and administrative expenses that benefit all contracts and business activities. Unlike overhead, which is tied to specific production functions, G&A covers the cost of running the entire organization.

Company-Wide Costs

G&A expenses include executive management, corporate accounting, legal, HR, business development, corporate rent, and other costs that benefit the business as a whole — not any single contract or project.

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FAR 31.203 Governed

FAR 31.203 establishes the rules for indirect cost allocation. G&A must be allocated on a base that represents the total activity of the business. CAS 410 further governs base selection for CAS-covered contracts.

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Final Indirect Rate

G&A is the "outer layer" of indirect rates. It is applied after overhead and fringe have already been applied. The G&A rate is applied to the broadest base of all indirect pools.

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Applied to Every Contract

Unlike overhead, which may apply only to contracts with labor, G&A is applied to every contract type — cost-reimbursable, T&M, fixed-price, and commercial work.

Schedule B: The G&A Pool

All G&A expenses are accumulated on Schedule B of the ICP. This schedule lists every account classified as G&A, showing per-G/L amounts, adjustments, and the claimed total.

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IR&D/B&P Flows In

Independent Research & Development and Bid & Proposal costs (with their applied overhead and fringe) flow into the G&A pool on Schedule B. This creates a dependency between Schedules A, E, H, and B.

02 — Pipeline
G&A Rate Computation Flow
The G&A rate is the ratio of the G&A pool (Schedule B) to the G&A allocation base (Schedule E). The base type — TCI, Value Added, or Single Element — determines what costs are included in the denominator.
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Schedule B

G&A expense accounts
+ IR&D/B&P costs
= G&A Pool (numerator)

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Schedule E

G&A allocation base
TCI, Value Added,
or Single Element

=
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G&A Rate

Expressed as %
rounded to 4 decimals
(e.g., 8.60%)

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Schedule H

Applied to each
contract's share
of the base

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Pool = Schedule B

All G&A accounts from the chart of accounts, plus IR&D/B&P direct costs and their applied overhead and fringe. Adjustments for unallowable costs are netted here.

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Base = Schedule E

The allocation base aggregates costs from Summary Schedule H. The base type (TCI vs. Value Added vs. Single Element) determines which cost elements are included.

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Rate = Pool / Base

The G&A rate is computed to 4 decimal places as a percentage. This rate appears on Schedule A and is applied to every contract on Schedule H.

03 — Schedule B
The G&A Cost Pool
Schedule B is where all G&A expenses are accumulated. It includes every account classified as G&A in the chart of accounts, plus the IR&D/B&P costs that flow in from Schedule H.

What Goes Into the G&A Pool

The G&A pool captures all management and administrative costs that cannot be directly charged to contracts or assigned to a specific overhead pool. These are the costs of running the business itself.

  • Executive Compensation — CEO, CFO, and executive management salaries and benefits
  • Corporate Functions — Accounting, HR, legal, IT support, corporate rent, insurance
  • Business Development — Marketing, proposal costs (non-B&P), trade shows, memberships
  • IR&D/B&P — Direct costs plus applied OH and fringe flow from Schedule H into the G&A pool
  • Adjustments — Unallowable costs (entertainment, lobbying, fines) are removed via adjustments
Schedule B G&A pool
Schedule B: G&A cost pool with per-G/L amounts, adjustments, and claimed totals
04 — Schedule E
The G&A Allocation Base
Schedule E computes the denominator of the G&A rate. The base must represent the total activity of the business per FAR 31.203. Three base types are available, each including different cost elements.

How the Base Is Built

The G&A base is assembled from Schedule H (Summary H) by summing cost elements across all contract sections. The base type determines which elements are included or excluded.

  • Direct Costs — Labor, material, subcontracts, travel, and other direct costs from all contracts
  • Applied Overhead — OH amounts applied to each contract (included in TCI and Value Added bases)
  • Applied Fringe — Fringe benefit amounts if carried as a separate rate
  • Intermediate Pools — Occupancy, service centers, and other allocated intermediate costs
  • Exclusions — Value Added base excludes direct material and subcontracts from the denominator
Schedule E allocation bases
Schedule E: G&A allocation base with cost element breakdown
05 — Formulas
G&A Rate Formulas
The core G&A computation is straightforward — pool divided by base — but the base calculation varies significantly depending on the allocation method chosen.
G&A Rate = Pool / Base

Core Rate Formula

The G&A pool (Schedule B grand total) divided by the G&A base (Schedule E), rounded to 4 decimal places and expressed as a percentage.

4-Decimal Precision
TCI = Direct + OH + Fringe + Intm

Total Cost Input Base

The most inclusive base. Sums all direct costs, applied overhead, applied fringe, and intermediate pool allocations across all contracts. The broadest denominator.

Most Common
VA = TCI - Material - Sub

Value Added Base

Starts with TCI, then removes direct material and subcontract costs. Prevents high-material contracts from absorbing a disproportionate share of G&A. Governed by CAS 410.

CAS 410 Option
SE = Direct Labor

Single Element Base

Uses only direct labor as the allocation base. The narrowest denominator, producing the highest G&A rate. Only appropriate when labor is the predominant cost driver.

Narrow Base
Contract G&A = Base × Rate

Application on Schedule H

Each contract's share of the allocation base is multiplied by the G&A rate. The result appears as "Applied G&A" on Schedule H for every contract.

Per Contract
Pool += IR&D/B&P

IR&D/B&P Feedback

IR&D and B&P costs (direct + applied OH + fringe) flow back into the G&A pool on Schedule B. G&A is not applied to IR&D/B&P themselves to avoid circular double-counting.

Circular Resolution
06 — Base Selection
TCI vs Value Added
Choosing the right G&A allocation base is one of the most impactful decisions in an ICP. The base type affects every contract's G&A allocation and can shift tens of thousands of dollars between contracts.

When to Use Each Base

CAS 410 requires the G&A base to represent the total activity of the business. When material and subcontract costs are a large, variable portion of direct costs, Value Added may better represent the contractor's own productive activity.

  • TCI — Best when material and subcontracts are a consistent, moderate portion of costs across all contracts. The simplest and most commonly accepted base.
  • Value Added — Best when one or two contracts have disproportionately large material or subcontract costs that would otherwise absorb excessive G&A.
  • Single Element — Rarely used. Only when direct labor is the overwhelmingly dominant cost element (typically over 85% of direct costs).
  • CAS 410-50(d) Test — Changing your base requires justification: statistical analysis, distortion testing, and demonstration that the new base better represents total activity.
Scenario modeling base analysis
Base analysis comparing TCI, Value Added, and Single Element G&A rates
07 — Scenario Modeling
What-If Analysis for G&A Rates
The ICP Dashboard includes a full scenario modeling suite that lets you explore how changes to the G&A pool, allocation base, and cost structure affect your rate — before you commit to anything on your ICP.

Side-by-Side Rate Comparison

Create up to three scenarios and compare them against your baseline. Each scenario can use a different G&A base type, pool adjustments, or cost reclassifications — and instantly see the impact on every rate.

  • Base Type Toggle — Switch a scenario between TCI, Value Added, and Single Element to see how the G&A rate changes under each allocation method
  • Pool Adjustments — Move costs between OH and G&A pools and see cascading rate effects in real time
  • Delta Highlighting — Rate increases and decreases are color-coded so you can spot the impact at a glance
  • Contract-Level Preview — See how G&A allocation shifts across individual contracts under each scenario
Scenario comparison view
Side-by-side comparison of three G&A rate scenarios against baseline
07 — Scenario Modeling (cont.)
Calculators & Justification

Target Rate Calculator

Working backwards from a target G&A rate is a common need during negotiations and rate planning. The target rate calculator reverse-solves the formula to tell you exactly what pool or base is required.

  • Solve for Pool — Enter your target rate and current base, and the calculator computes the maximum pool amount to hit that rate
  • Solve for Base — Enter your target rate and current pool, and the calculator computes the minimum base required
  • One-Click Apply — Apply the calculated result directly to the scenario and see the full downstream impact
Target rate calculator
Reverse-solve for the pool or base needed to achieve a target G&A rate

Base Change Justification

If scenario modeling reveals that a different base type produces a fairer allocation, the dashboard provides the CAS 410-50(d) justification analysis you need to support the change.

  • OLS Regression — Multi-year regression analysis across TCI, Value Added, and Direct Labor bases with R², p-values, and confidence intervals
  • Rate Impact Analysis — Contract-by-contract comparison of G&A allocations under each base type, with cross-subsidization detection
  • Sensitivity Analysis — Material/subcontract concentration metrics, Herfindahl index, and rate stability ranking
  • Exportable Report — Print-ready CAS 410 justification report with all statistical evidence and regulatory citations
Regression scatter plots
OLS regression analysis with scatter plots for base change justification
08 — Common Mistakes
G&A Rate Pitfalls
The G&A rate is the most scrutinized indirect rate in a DCAA audit. These common mistakes lead to adequacy failures, questioned costs, and rate adjustments.
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Unallowable Costs in the Pool

Entertainment, alcohol, lobbying, fines, and other FAR 31.205 unallowable costs left in the G&A pool inflate the rate. Every unallowable dollar must be adjusted out.

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Mismatched Pool and Base

The G&A base must include costs from all business segments that benefit from G&A. Excluding commercial work from the base while including G&A costs that support it creates an inflated rate.

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Applying G&A to IR&D/B&P

IR&D/B&P costs flow into the G&A pool — they are part of the pool, not the base. Applying G&A on top of IR&D/B&P double-counts these costs and creates a circular error.

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Changing Base Without Justification

Switching from TCI to Value Added (or vice versa) requires CAS 410-50(d) justification: statistical analysis, distortion testing, and a formal disclosure statement change.

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Excluding Intermediate Pool Costs

If you use a TCI base, intermediate pool allocations (occupancy, service centers) must be included in the base. Omitting them understates the base and inflates the G&A rate.

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Wrong Rounding Precision

G&A rates must be rounded to 4 decimal places (e.g., 8.6023%). Using fewer decimals or full floating-point values creates reconciliation mismatches with DCAA.

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Missing Contract Sections on Schedule H

All contract types must appear on Schedule H for the G&A base to be complete. Omitting fixed-price or commercial sections understates the base and overstates the rate charged to cost-type contracts.

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Not Reconciling B to E to A

Schedule B (pool) divided by Schedule E (base) must equal Schedule A (rate). A $1+ variance between these schedules triggers an automatic DCAA adequacy failure.

Master Your G&A Rate

The ICP Dashboard automates G&A pool accumulation, base computation, rate calculation, and cross-schedule reconciliation — with built-in CAS 410 base analysis and what-if scenario modeling.

GovConDash.ai