Sign In
  • Question

    A given foreign per diem rate is within acceptable limits given the rate of exchange at the time the travel orders are approved. However, when the invoices are processed, the exchange rate applicable at the time of invoicing drives the per diem rate over the previously approved level. Is the contractor entitled to be reimbursed for the overage or must they absorb those costs themselves?


    The contract governs payment issues such as this. If the payment clause states that the exchange rate as of the date on the travel order will be used, then the contractor must absorb the cost if the value of the U.S. dollar rises between the date of the travel orders and the date when the invoice is processed. Conversely, the contractor can benefit if the value of the dollar falls during that period. If the contract states that the calculation is based on the date the invoice is processed, then that date is used. I would expect that the date of the travel order is the relevant date, as the contracting activity would not want to have to account for the uncertainties associated with changes in the Government’s liability after the date of the travel order.

    Open full Question Details
Bot Image