How to Record GFP Loss and Damage Liability
Recording the liability and unallowable loss for Government Furnished Property (GFP) that was lost, stolen, or damaged while in contractor possession.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Loss on Gov Property - Unallowable Expense | Debit | 12,000.00 | - |
| Accrued Liability - Government Claims | Credit | - | 12,000.00 |
💡 Accountant's Note
Under FAR 52.245-1, contractors may be held liable for loss of government property. These losses and associated repair or replacement costs are typically unallowable and must be excluded from indirect cost pools.
Practitioner & Systems Framework
💻 ERP Architecture
Post to a specific unallowable account code (e.g., 9999-Unallowable) to ensure exclusion from overhead and G&A rates.
⚠️ Audit Flags
Inconsistencies between the Property Management System and the General Ledger regarding missing asset tags.
📄 Required Documentation
Property Loss Report (PLR) submitted via PIEE, contracting officer's determination of liability.
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