How to Record FAR Patent Rights Retention Costs
Recording costs for legal services required to retain title to inventions made during government contract performance.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| G&A Expense - Patent Legal Fees (Allowable) | Expense | 8,000.00 | - |
| Cash | Asset | - | 8,000.00 |
💡 Accountant's Note
Under FAR 31.205-30, costs to prepare disclosures, reports, and other documents required by the contract to retain title to a patent are allowable and charged to G&A.
Practitioner & Systems Framework
💻 ERP Architecture
Map these costs to an 'Allowable Patent Costs' account in the G&A pool to ensure proper overhead recovery.
⚠️ Audit Flags
Misclassification of patent defense costs (unallowable) as patent retention costs (allowable).
📄 Required Documentation
Documentation of the invention disclosure to the government and the legal invoices for title retention filings.
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