Overhead Costs:

Unallowable and Questionable Costs Charged by McDonnell Douglas Corporation

T-NSIAD-94-60: Published: Oct 13, 1993. Publicly Released: Oct 13, 1993.

Additional Materials:


Office of Public Affairs
(202) 512-4800

GAO discussed a Department of Defense contractor's inclusion of unallowable and questionable costs in its overhead cost submissions. GAO noted that: (1) of the $2.3 million in overhead costs the contractor submitted for payment, $1.6 million were unallowable or questionable; (2) unallowable or questionable costs included costs for alcoholic beverages, entertainment, meals, employee relations, professional public relations services, and other unallowable charges; (3) the costractor's cost for distributing a corporate videotape was unreasonably high; (4) the actual amount of unallowable or questionable costs depends on the amount of defense versus commercial business performed and type of government contract; and (5) the contractor's inclusion of unallowable or questionable costs in its overhead costs submissions was primarily due to weak internal controls and its interpretation of federal procurement regulations.

Nov 8, 2018

Nov 5, 2018

Nov 2, 2018

Nov 1, 2018

Oct 23, 2018

Oct 11, 2018

Oct 10, 2018

Oct 9, 2018

Sep 24, 2018

Looking for more? Browse all our products here