What is an allowable cost versus an unallowable cost? Allowable costs meet all compliance criteria for an award agreement. Unallowable costs fail to meet compliance criteria for an award agreement. Read more: Office of Contracts and Grants, Fiscal Compliance Office of Contracts and Grants, Allowable vs. Unallowable Costs Updated on March 1, 2020 Tagged: Budgetchargescontracts and grantsExpendituresExpenses Was this article helpful? Yes No Not what you are looking for?If you can't find the answer to a question, contact us by click on the button below.Contact Support