How to Record Bid Protest Legal Costs
Recording the costs associated with filing or defending a bid protest, which are generally unallowable under FAR 31.205-47.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Unallowable Legal Expenses | Debit | 15,000.00 | - |
| Accounts Payable | Credit | - | 15,000.00 |
💡 Accountant's Note
Legal costs related to bid protests are specifically designated as unallowable under the Federal Acquisition Regulation (FAR). They must be segregated in the general ledger to ensure they are excluded from indirect cost pools.
Practitioner & Systems Framework
💻 ERP Architecture
Use a specific 'Unallowable' department code or account suffix to capture these costs automatically.
⚠️ Audit Flags
Segregation of unallowable legal fees in G&A audits.
📄 Required Documentation
Legal invoices and a description of the matter (e.g., GAO Protest B-XXXXXX).
Automate this entry with the JEH Accounting Suite
Stop doing manual entry. Our VBA-powered ERP automatically generates your ledgers, Trial Balance, and Financial Statements.
No Subscriptions. Own your data.
Expert Analysis by Qusai Ahmad
General Accountant Supervisor & IFRS Specialist
Specialized in SAP GUI automation and Middle Eastern tax compliance. Building digital tools for the next generation of finance leaders.
Related Journal Entries
Defense, Aerospace & Government Contracting
Cost-Plus-Fixed-Fee (CPFF) Contract — Revenue Recognition as Costs Are Incurred
Defense, Aerospace & Government Contracting
Firm Fixed-Price (FFP) Contract — Cost-to-Cost Percentage of Completion Revenue
Defense, Aerospace & Government Contracting
Time & Materials (T&M) Contract — Revenue at Contractual Labor Rates Plus Material Cost
Discussion & Community Questions
Loading comments...