How to Record GFM Transportation Variances
Recording the variance between estimated shipping costs for Government Furnished Material (GFM) and the actual invoices received from third-party logistics providers.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| GFM Logistics Variance (Indirect) | Debit | 640.00 | - |
| Accrued Freight Liabilities | Credit | - | 640.00 |
💡 Accountant's Note
When actual freight costs for moving GFM exceed the initial estimate or allocation, the variance must be captured in an appropriate indirect cost pool to ensure equitable distribution under FAR 31.205-45.
Practitioner & Systems Framework
💻 ERP Architecture
Capture variances in a sub-ledger linked to the Material Management and Accounting System (MMAS).
⚠️ Audit Flags
Large variances in freight accounts relative to historical GFM volume.
📄 Required Documentation
Bill of Lading, freight invoices, and original GFM shipping estimates.
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