Guidance for direct charging administrative costs to sponsored programs.
Office of Management and Budget (OMB) Circular A-21, "Costs Principles for Educational Institutions" * requires that administrative and clerical expenses be treated as facilities and administrative (F&A) costs, rather than direct costs. Costs incurred for the same purpose in similar circumstances must be treated consistently, across the institution, as either F&A costs or direct costs. Exceptions can be made when administrative and clerical expenses are required to support major programs or activities.
Examples of major programs include:
- Large, complex research centers and other grants and contracts that entail assembling and managing teams of investigators;
- Projects that involve extensive data accumulation, entry and analysis;
- Projects such as conferences and seminars that require travel and meeting arrangements for large numbers of non-UNH participants.
Why it’s important
Administrative salaries and clerical expenses charged to sponsored programs that do not meet the criteria are subject to disallowance by UNH’s federal auditors. Their inconsistent treatment, as either F&A or direct costs, can be deemed a material weakness in UNH’s financial controls.
How to comply
- Essential to the project's programmatic or technical purpose;
- Explicitly identified with the project, as reflected in the budget and proposal narrative;
- Approved by Sponsored Programs Administration, New Hampshire Agricultural Experiment Station, or University of New Hampshire Cooperative Extension for USDA Land Grant Appropriations to meet the University consistency standard, and
- Explicitly approved or not specifically disapproved by the sponsor, as reflected in the award budget.
Grant and Contract Administrators in SPA are available to assist in the interpretation and application of University policy and the OBM Circular A-21 Cost Principles*.
*Awards issued on or after 12/26/2014 are subject to 2 CFR 200 - Uniform Guidance
|PI Essentials: Guidance Document #2
©2012 UNH Sponsored Programs Administration, adapted with permission from Massachusetts Institute of Technology Office of Sponsored Programs