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  • Question

    Our company was purchased and our name has been changed. Are the costs to purchase signage with the new name for our building allowable?


    Answer

    The following response is based solely on the question and background information provided.  As we do not have all the facts particular to your situation; we recommend, as applicable, you consult your leadership, contracting officer and/or Legal Office for guidance.
     
    The area of the FAR that addresses allowable costs is FAR part 31Preceding the response, we note that FAR 31.204 -- Application of Principles and Procedures states in (d)
      "Section 31.205 does not cover every element of cost. Failure to include any item of cost does not imply that it is either allowable or unallowable. The determination of allowability shall be based on the principles and standards in this subpart and the treatment of similar or related selected items. When more than one subsection in 31.205 is relevant to a contractor cost, the cost shall be apportioned among the applicable subsections, and the determination of allowability of each portion shall be based on the guidance contained in the applicable subsection. When a cost, to which more than one subsection in 31.205 is relevant, cannot be apportioned, the determination of allowability shall be based on the guidance contained in the subsection that most specifically deals with, or best captures the essential nature of, the cost at issue."
     
    The area of the FAR that addresses allowable costs is FAR 31.205We researched FAR 31.205-1, -11, -12, -13, -17, -26, -27, -28, and -29.  
     
    The most closely related to the question of signage is 31.205-1 -- Public Relations and Advertising Costs.
    ...(f) Unallowable public relations and advertising costs include the following:
      (1) All public relations and advertising costs, other than those specified in paragraphs (d) and (e) of this subsection, whose primary purpose is to promote the sale of products or services by stimulating interest in a product or product line (except for those costs made allowable under 31.205-38(b)(5)), or by disseminating messages calling favorable attention to the contractor for purposes of enhancing the company image to sell the company’s products or services.
     
    We believe signage falls within, "calling favorable attention to the contractor for purposes of enhancing the company image..."  Given that, signage would be considered unallowable.
     

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