I’m not an expert, but in the world of government contracting margins are often fixed. It’s common to contract on a “cost plus” basis where the contractor discloses its costs and is paid an agreed margin on top. For a diversified business like BAH (well not that diversified but I digress), they’d need to allocate sg&a in some way to those cost plus contracts. My guess is they were doing it in a way that was, shall we say, “advantageous.”
