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Should Shipping Organizations Permit Reserve Funds for Cost of Transportation?

Whether or not to set aside a reserve fund to cover the cost of transportation is a complicated question, but it is a very important one. Shipping organizations must be able to provide a service that meets their standards of quality and safety, and a reserve fund should be set up for just that reason. These funds can be used for any reason, including emergencies. They must be able to cover all expenses related to transporting the goods, and they must do so with a positive balance.

When a shipping organization must set up a reserve fund for transport, they must use the best accounting practices available. Many shipping organizations allocate allowable costs as direct costs, while others use F&A. The type of expense depends on the recipient’s accounting system and the nature of the shipment. Some costs are direct and some are F&A. The fees for a new permit will vary by the month in which it is issued.

Final Thought

In addition to the reserve fund for transportation, shipping organizations also have to provide funding for ELSO members. They are responsible for all shipments, including vehicles. However, for transporting DOD personnel’s vehicles, the post must contact ELSO and request funding from the program. For this reason, it is important to remember that different freight rates apply to various goods, and posts should carefully package their effects to qualify for a lower rate.

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