Policy Approval Authority | President |
Responsible Division | Division of Research and Innovation Partnerships |
Responsible University Office | Sponsored Programs Administration |
Responsible Officer(s) | Assistant Vice President for Research and Sponsored Programs |
Contact Person | Dara Little |
Primary Audience |
Faculty
Staff Administration |
Status | Active |
Last Review Date | 07-08-2022 |
Policy Category/Categories |
Finance / Risk Management
Sponsored Funding/Grants and Contracts |
To prevent unallowable costs from being charged to sponsored awards and to ensure that those costs are removed from the award as soon as they are discovered.
It is university policy to charge costs to federal and non-federal sponsored projects in accordance with applicable laws, regulations, sponsor policies, and other requirements. For federal sponsors, the Office of Management and Budget’s (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (aka, “Uniform Guidance”), Section 2 CFR §200.400 Subpart E establishes principles for determining applicability and allowability of costs to grants, contracts, and other agreements with educational institutions.
These principles apply regardless of whether a particular cost is treated as a direct cost or an indirect cost.
This policy applies to all sponsored projects at the university; however, costs identified as “unallowable” on federally funded projects may be allowable on a non-federally funded project if permitted by both university policy and the non-federal sponsor’s award terms and conditions or with written sponsor approval.
When unallowable costs are discovered as part of award monitoring or project close-out, the costs will be removed from the award cost center and transferred to the indirect cost center of the home department of the Principal Investigator or other cost center provided by the department.
Roles and Responsibilities:
Principal Investigator
Sponsored Programs Administration
Vice President for Research and Innovation
Definitions:
Allowable Costs
In addition to meeting the specific standards for allowability under 2 CFR 200.400 Subpart E-Cost Principles, costs must meet certain general criteria to be allowable for federally sponsored projects. To be allowable, the cost must be reasonable, allocable to the sponsored project, be treated consistently between sponsored and non-sponsored funds, and conform to any limitations or exclusions set forth in 2 CFR 200 or in the sponsored project agreement.
Reasonable Cost Test
A cost may be considered reasonable if the nature and amount of the cost reflect actions that a prudent person would have taken under circumstances prevailing at the time. Among other factors, a reasonable cost is one generally recognized as necessary for the operation of the university or the performance of the sponsored project and is consistent with established institutional policies and practices applicable to the work of the institution generally, including sponsored projects.
Allocable Cost Test
A cost is allocable to a sponsored project if it is incurred specifically to advance the work under the sponsored project. When a cost benefits both the sponsored project and other activities of the university, charges to the project should be based on reasonable estimates of the benefit to each institutional activity (also referred to as cost allocation).
Allowability and Unallowability of Selected Items of Costs
Unallowable costs are not eligible for reimbursement by the sponsor. Below is a list of costs normally considered unallowable under Uniform Guidance. Depending on the nature of the award and the sponsor-specific agreement, some costs that are generally unallowable may be allowable for a specific award.
Advertising:
Alcoholic beverages:
Commencement and convocation cost:
Entertainment:
Fundraising, lobbying, and public relations costs:
Fines and penalties and defense of fraud proceeding, including insurance against defects in University’s materials or workmanship:
Memorabilia or promotional material:
Moving or relocation costs if employee resigns within 12 months:
Certain travel costs:
Cash donations to other organizations including universities:
Goods or services for employee personal use:
Additional compensation:
Administrative Salaries:
Membership costs:
Publication, documentation, and dissemination:
Selling and marketing costs:
Severance costs:
Policy References:
Policy Library
815-753-5560
policy-library@niu.edu
Comments
There are no comments to show.