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What do people really mean by administrative costs? Is it just an umbrella term to actually get money from a person for no real costs, just for a service? Or it includes really some expenses?

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    context: for a mutual fund?; for a company?; for a family?; for a service? Commented Apr 15, 2018 at 17:39
  • Are you asking about SG&A in accounting? Or a cost in a contract you're considering? Or something you were billed for?
    – The Photon
    Commented Apr 15, 2018 at 17:40
  • @ThePhoton, I just met on one site where it was asked where someone can get a new IELTS certificate after changing the passport name. In one of the answers there was written that the person could be charged for administrative costs though. Commented Apr 15, 2018 at 17:43
  • @mhoran_psprep, I wrote a comment with the context Commented Apr 15, 2018 at 17:43
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    Can you give a link to the other comment, so that answers can be based on the actual context where the term was used?
    – The Photon
    Commented Apr 15, 2018 at 17:46

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Administrative costs is an umbrella term for many different types of expenses, some of which may include an administrative assistant's or any other staff's time to process documents and/or materials used in processing said requests / documents (e.g. paper, ink, amortization of software and hardware, etc).

Pricing methods varies depending on the intent of charging an administrative expense in the first place. Some methods involve calculating the real cost and charging a portion of it, all of it or all of it plus a markup. Other methods may simply put a price high enough to discourage the use of said service when it must otherwise be provided.

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