Since the early 1980's, the shop overhead rate has begun to escalate after many years of relative consistency. This study was originated to determine the correct factors that should be included in shop overhead, to provide guidelines for managers to help them assure proper timesheet coding, and to provide an on-going monitoring system.
This study was initiated by the Mn/DOT Financial Operations Division because concern over the rising shop overhead rate was noted by field personnel, Mn/DOT managers, and the Finance Office. Everyone involved questioned why the rate had begun to fluctuate widely in the last few years.
