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Business and Financial Policies and Procedures

Treatment of Select Items of Cost

This policy highlights select items of cost that should be considered in the budget preparation process and post-award management of awards. The list is not meant to be all inclusive. Failure to mention a particular item of costs is not intended to imply that it is either allowable or unallowable. Rather, determination of allowability should be based on the treatment provided for similar items of costs and the principles in Uniform Guidance/A-21.

Below are terms used within the list; specific identification with a sponsored project should be the determining factor in distinguishing direct from indirect costs, rather than the nature of the goods or services. Costs incurred for the same purpose in like circumstances must be treated consistently, as either direct or indirect costs.

Direct Costs - Costs that can be identified specifically with a particular sponsored project or other internally or externally funded activity, or that can be directly assigned to such activities relatively easily with a high degree of accuracy. For more information, see Uniform Guidance §200.413.

Indirect Costs (Facilities and Administrative (F&A) costs) - Costs incurred for a common or joint purpose benefitting more than one cost objective, and not readily assignable to a particular sponsored project. Indirect (F&A) cost components include depreciation, interest, operations and maintenance, and library costs, as well as departmental, sponsored project, general, and student services administration costs, and other similar costs, that benefit many activities. For more information, see Uniform Guidance §200.414.

Restricted Costs - Federal regulations restrict charging certain types of costs directly to federal sponsored projects, though in some instances they are permitted as direct charges if there is explicit justification. These costs are allowable charges to indirect cost pools. Examples include administrative salaries, memberships, postage, office supplies, and telephone monthly line charges.

Unallowable Costs - These are costs that are not allowable as either direct charges to federal sponsored agreements, indirect cost pools, or recharge centers. Examples include expenses associated with alumni relations, fund raising or development, community relations, and investment management. There are also individual unallowable cost items, such as trustees' travel, fines and penalties, interest expense, etc.

Click on each item for treatment guidelines.

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Administrative Salaries

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Administrative Salaries

Federal funds (including direct and federal pass-through) – Restricted

All other funds – Allowable

The salaries of staff employees in the groups listed below may not be charged as a direct cost to federal Fund Types 4A and 4Y (including other fund types with federal pass-throughs) sponsored project except under the following conditions:

  1. they are specifically budgeted and approved by the sponsor, or
  2. they are secretarial salaries and are rebudgeted by the principal investigator in a manner consistent with the six criteria stated below.

This restriction applies to administrative salaries regardless of appointment method.

Secretaries and similar administrative employees may be charged directly to sponsored projects under circumstances as outlined below:

  1. Large, complex programs.
  2. Projects which involve extensive data accumulation.
  3. Projects that involve meeting arrangement for a large number of participants.
  4. Projects whose principal focus is the preparation and production of publications.
  5. Projects that are geographically inaccessible.
  6. Individual projects requiring project-specific database management, individualized graphics or manuscript preparation, human or animal protocol, IRB
  7. preparations and/or other project-specific regulatory protocols, and multiple project-related investigator coordination and communication.

UG §200.413

(c) The salaries of administrative and clerical staff should normally be treated as indirect (F&A) costs. Direct charging of these costs may be appropriate only if all of the following conditions are met:

(1) Administrative or clerical services are integral to a project or activity;

(2) Individuals involved can be specifically identified with the project or activity;

(3) Such costs are explicitly included in the budget or have the prior written approval of the federal awarding agency; and

(4) The costs are not also recovered as indirect costs.

Note that it is expected that the University provide administrative and clerical support, which is recovered in the form of indirect costs. Administrative or clerical support costs charged directly would require explicit narrative in the budget justification to explain the need for support over and above normal support. The justification would need to address all four conditions outlined in UG §200.413(c) as noted above. For condition (4) there must have been a change in the individual’s job duties that differentiate their activities from general administrative support to project-specific administrative support.

 

 

Advertising

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Advertising

Federal funds (including direct and federal pass-through) – Restricted

All other funds – code as Unallowable

Direct charges are restricted to recruiting personnel for sponsored agreements, procurement of goods and services for sponsored agreements, solicitations for participants, and disposition of surplus/scrap materials purchased with federal funds.

Advertising should be charged to account 1414XX so that the costs can be identified and properly treated in the indirect F&A cost study. Recruitment of students charged to function 14XX is an allowable student services activity cost.
 

UG §200.421

Same

See detailed list in UG

 

 

Alcoholic Beverages

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Alcoholic beverages

Sponsored project funds - Unallowable

Gift funds, departmental activity self-supporting funds, and service plan funds – Restricted

All other funds – Do Not Charge

Costs of alcoholic beverages are generally unallowable on sponsored funds. Some sponsors may provide special exceptions.

Special campus approvals are required for purchasing and serving alcoholic beverages.

See 8.1.1 Business Meals, Refreshments, and Alcohol for further guidance.

UG §200.423

Same
 

 

 

Alteration and renovation (Now called Rearrangement and Reconversion Costs in UG)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Alteration and renovation

(Now called Rearrangement and Reconversion Costs in UG)

Federal Funds (including direct and federal pass-through)–Restricted

All other non-federal funds – Allowable

Alteration and renovation (work to change the interior arrangements or other physical characteristics of an existing facility) cannot be charged directly to a federal agreement unless it is included in the approved budget or specifically approved by the sponsor.

If not included in the original budget, specific approval for alteration and renovation must be obtained for these costs to be allowable on sponsored projects.
 

UG § 200.462

Normally treated as indirect costs. 

Special arrangements and alterations costs incurred specifically for a sponsored project are allowable as a direct cost with the prior approval of the sponsor.

 

 

Alumni activity

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Alumni activity

Federal funds (including direct and federal pass-through) – Do Not Charge

All other funds – Code as Unallowable

Unallowable as a charge to federal funds, F&A cost pools, or stores and services recharge centers.

For other fund sources, must be recorded in program codes with NACUBO function XX99.
 

UG §200.424

Same
 

 

 

Animals/Animal Care

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Animals /Animal Care

All funds – Allowable

Use 1411XX account code in recharge center charge backs and the appropriate account codes where animal costs are charged directly.

Prior to incurring animal costs, the department must obtain approval for Institutional Animal Care and Use Committee (IACUC) protocols for costs to be allowable.
 

Same

 

 

Applicable credits

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Applicable credits

All funds – Restricted to the source of funds that incurred the expenditure

Must be used to offset or reduce direct or indirect cost items. For example, purchase discounts, rebates, allowances, recoveries or indemnities on losses, insurance refunds or rebates, and adjustments of overpayments or erroneous charges. Must be applied to the source of funds that incurred the expenditure either as a cost reduction or cash refund, as appropriate.

UG §200.406

Same

 

 

Automobile Damage and Insurance

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Automobile Damage and Insurance

All sponsored project funds – Restricted All other funds – Allowable

Costs of insurance required or approved and maintained, pursuant to the sponsored project, are allowable.

Damage insurance coverage offered by the University carpool should be elected and charged to an allowable funding source. Any damage incurred that would have been covered by purchasing insurance cannot be charged to sponsored projects.

Any vehicle repair/replacement costs in excess of nominal deductible insurance coverage must be charged to an allowable funding source and recorded in program codes with NACUBO function XX99.

UG §200.447

Same

See detailed list in UG

 

 

Automobile furnished by institution for personal use

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Automobile furnished by institution for personal use

Federal funds (including direct and federal pass-through) – Do Not Charge

All other categories – Code Unallowable

The expense for cars used for the personal benefit of employees is unallowable, regardless of whether or not the cost is reported as taxable income to the employees and is treated in the same way as other goods and services for personal use.

Must be charged to an allowable funding source and recorded in program codes with NACUBO function XX99.

UG §200.445

Same

 

 

Bad Debts

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Bad debts

Federal funds (including direct and federal pass-through) – Do Not Charge

Service Activity Fund Type 3E – Do Not Charge

All other funds – Use account code established for this purpose

Unallowable as a direct charge to a sponsored project for bad debts arising from uncollectible accounts, related collection costs, and related legal costs.

Bad debts charged to Fund Types 1A – 3Q are excluded from the F&A cost calculation by virtue of being charged to account codes 186100-186119 "Bad Debt Expense."

UG §200.426

Same

 

 

Books/Reference materials

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Books/Reference materials

Sponsored project funds – Restricted

All other funds – may be Allowable

Normally not allowable. Typically treated as part of the F&A costs (not charged directly to sponsored projects).

UG §200 – Appendix III – B8a

Same

 

 

Business meals and meeting costs (See Luncheon/Receptions)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Business meals and meeting costs

 

See Luncheons/Receptions table.

Same

 

 

Collections of improper payments

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Collections of improper payments

Sponsored project funds – Restricted

All other funds – may be Allowable

 

UG §200.428

The costs incurred by a non-federal entity to recover improper payments are allowable as either direct or indirect costs, as appropriate. Amounts collected may be used by the non-federal entity in accordance with cash management standards set forth in UG §200.305 Payment.
 

 

 

Commencement and convocation costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Commencement and convocation costs

All sponsored project funds and Service Activity Funds 3E – Do Not Charge

All other funds – Code as Unallowable*

Unallowable as a direct charge to a sponsored project or service activity.

Commencement costs incurred in funds other than student affairs funds with NACUBO function 1400 are unallowable and recorded in program codes with NACUBO function XX99.

UG §200.429

Same

 

 

Communication Costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Communication Costs

Federal funds (including direct and federal pass-through) – Restricted

All other funds – Allowable

Normal or routine costs such as fixed, monthly costs of telecommunications (includes bundled service plans, Lync, Voice Over IP Tone/Voice, etc.) services are unallowable as a direct charge to sponsored projects.

The installation and monthly cost of internet service, cellular phones, and other telecommunications services/devices that go beyond normal or routine costs can be charged to federal projects only with explicit written sponsor approval.

Charges for business services incurred while in travel status such as computer (Internet) use are not normally allowable on sponsored project funds. They may be allowable with appropriate documentation on departmental funds as reimbursable university business travel expenses.

Typically treated as indirect costs.

Same

Also refer to 8.7 Cell Phone & Data Plan Business Expenses.

 

 

Compensation for personal services by Academics and Staff Exempt from the Fair Labor Standards Act (See Administrative Salaries – for administrative and clerical staff; See Overtime - for non-exempt employees.)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Compensation for personal services by Academics and Staff Exempt from the Fair Labor Standards Act

(See Administrative Salaries - for administrative and clerical staff)

(See Overtime - for non-exempt employees)

Federal funds (including direct and federal pass-through) – Allowable with special approvals required by University and sponsor for consultation across departmental lines

All other funds – Allowable with special approvals required by University for consultation across departmental lines

Charges for work performed on sponsored agreements during all or any portion of a project period are allowable at the Institutional Base Salary (IBS) rate.

In unusual cases where consultation is across departmental lines or involves a separate or remote operation, and the work performed by the consultant is in addition to his regular departmental load, any charges for such work representing extra compensation above the base salary are allowable provided that such consulting arrangements are approved by the University, specifically provided for in the agreement, or approved in writing by the sponsoring agency or the sponsor has provided the University with greater authority to approve.

Refer to the following campus policies:

UIUC - Effort and Compensation on Sponsored Projections Section for definition of IBS.

UIC – Effort Reporting PoliciesLink opens new window

UIS – Contact UIS Grants & Contracts Office.

UG §200.430

Same

 

 

Computing services

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Computing services

All sponsored project funds – Do Not Charge*

All other funds – Allowable

The costs of routine computing services such as desktop support, etc., are considered administrative in nature and are a component of the F&A rate and therefore cannot be charged to federal sponsored projects.

Scientific or technical computing services (such as high performance computing) which are provided to meet a specific project objective may be allowable if charged in accordance with institutional and sponsor policies.
 

UG §200.413

Same

In addition, these services must be considered unlike (special) circumstances and directly benefit a specific project for direct charging.

 

 

Conference Costs or Meeting Registration Fees (See also Travel Costs)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Conference costs or meeting registration fees

(See also Travel Costs)
 

All sponsored project funds – Restricted

Allowable on sponsored projects under account code 1416XX if reasonable and there is a direct benefit to the project. Additionally, some sponsors may require prior approval.

Same

 

 

Consultants (Professional Service Costs)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Consultants (professional service costs)

Federal funds (including direct and federal pass-through) – Governed by University policy with additional restrictions by some agencies 

All other funds – Governed by University policy
 

17 Consultants and Independent Contractors includes professional and artistic services and governs use of consultants in both sponsored projects and other University funds.

Costs of consultants are allowable when reasonable in relation to the services rendered. Payments should be comparable to the normal or customary fees charged and received by the consultant for comparable services.

UG §200.459

Same

 

 

Contingency reserves (not self-insurance)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Contingency reserves (not self-insurance)

All funds – Unallowable

Unallowable, except for self-insurance reserves (see Insurance Costs in this table). These reserves are recorded in funds monitored by the Office of Risk Management.

UG §200.433

Contingency provisions may be included in the budget for future costs that experience shows will likely result, in aggregate, in additional costs for the approved activity or project.

Amounts for major project scope changes, unforeseen risks, or extraordinary events are unallowable.

 

 

Contributions and donations to others

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Contributions and donations to others

Federal funds (including direct and federal pass-through) – Do Not Charge

All other funds – Code as Unallowable

Unallowable on sponsored projects. Certain private sponsors may allow these types of charges; sponsor approval for these exceptions must be documented.

For all other types of funds, monetary contributions made under an approved exception to this policy should be recorded in program codes with NACUBO function XX99.

UG §200.434

Same

 

 

Cost transfers

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Cost transfers

All funds – Governed by University policy

Cost transfers between or to sponsored agreements to eliminate overruns, to avoid restrictions imposed by law, or for other reasons of convenience are not permitted. (For additional information see 16 Grants and Research Contracts – Cost Tranfers.)

UG §200.405

Same

 

 

Defense and prosecution of criminal and civil proceedings

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Defense and prosecution of criminal and civil proceedings

Federal funds (including direct and federal pass-through) – Do Not Charge

All other funds – Allowable

Normally unallowable when the outcome is conviction or penalty. These costs are identified through a special study and excluded from the F&A cost pool.

UG §200.435

Same

 

 

Development

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Development

 

See Organized fund raising table

 

 

 

Donations

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Donations

 

See Contributions and donations to others table

 

 

 

Employee morale

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Employee morale

Federal funds (including direct and federal pass-through) – Do Not Charge

All other funds – Allowable in accordance with University policy

Allowable on institutional funds for awards, recognition dinners, and retirement and other such functions to the extent they are incurred in accordance with established University practice (see 8 Payments and Reimbursements).

UG §200.437

Same

 

 

Training and education

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Training and education

All sponsored project funds - Restricted

All other funds – Allowable

To be allowable as a direct charge to a sponsored project, the project must benefit directly from the employee's training. If the training benefits multiple projects, the cost of the training must be allocated proportionately.

UG §200.472

Same

 

 

Entertainment

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Entertainment

All sponsored project funds - Do Not Charge

Other funds – Restricted to gift funds and departmental activity self-supporting funds (when it is a non-sponsored project supported conference)

Entertainment, defined as amusement, diversion, social activities and associated costs such as tickets to shows or sports events, meals, lodging, etc,. is unallowable, and University policy prohibits such charges to institutional funds. Any event with alcoholic beverages served, available, or present is considered a social event. (See 8 Payments and Reimbursements).

When a programmatic purpose exists, the awarding agency could grant an exception with prior written approval.

Luncheons and receptions (business meals) are distinguished from entertainment/social events by the fact that they take place in connection with University business. Also see Luncheons/Receptions table.

UG §200.438

Same

 

 

Equipment

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Equipment

All funds - Allowable

Equipment is tangible property (other than land or buildings) of a more or less durable nature that is useful in carrying on the operations of a business. Regardless of cost, equipment is considered University property and must be managed according to University Policies and State Law. For additional information on the types of equipment, consult 12.1.2 Classify Equipment and Property.

The University inventories all property and equipment that, in general, have a useful life of more than one year and a unit value equal to or greater than $1,000. The University’s capitalization level for equipment is $5,000 or more per unit value and a useful life of more than one year.

General purpose equipment is not normally allowed as a direct charge on sponsored projects unless the equipment is primarily or exclusively used in the actual conduct of the project and with prior written sponsor approval.

"General purpose equipment" means equipment, which is not limited to research, medical, scientific or other technical activities. Examples include office equipment and furnishings, modular offices, telephone networks, information technology equipment and systems (e.g., computers and personal communication devices), air conditioning equipment, reproduction and printing equipment, and motor vehicles.

Special purpose equipment is allowable as a direct cost provided that items with a unit cost of $5,000 or more have the prior approval of the awarding sponsor.

Special purpose equipment means equipment which is only used only for research, medical, scientific, or other technical activities. Examples of special purpose equipment include microscopes, x-ray machines, surgical instruments, and spectrometers.

Equipment purchased during the last six months of a project are subject to additional scrutiny and approval.

For UIUC, also refer to 16.1.4 Equipment, Equipment Leases, and Expendable Supplies.

UG §200.438, §200.48, §200.89

Same

In the specific case of computing devices (per UG §200.453(c), charging as direct costs is allowable for devices that are essential and allocable, but not solely dedicated, to the performance of an award.

 

 

Federal employees expenses while working in their official capacity

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Federal employees' expenses while working in their official capacity

All funds– Do Not Charge

Unallowable under federal law. Federal employees working in their official capacity cannot be reimbursed for expenses they incur.

Exceptions for certain agencies may exist. See Sponsor-specific guidance table.

Same

 

 

Federal and state employees as paid consultants

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Federal and state employees as paid consultants

All funds – Restricted

Federal or state employees may serve as paid consultants on projects only with prior approval from their agencies and when the services are performed outside their regular working hours or while they are on leave from official duties. Certain federal agencies impose additional restrictions which are embodied in their grant administration manuals.

Same

 

 

Fines and penalties

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Fines and penalties

All sonsored project funds – Do Not Charge

All other funds – Code as Unallowable

Unallowable if violations of federal, state, local, or foreign laws. Should any such payments be made, they must be recorded in program codes with NACUBO function XX99.

All late payment penalties are charged to BANNER expense account code 186220 "late payment penalty" to ensure they are excluded from the F&A cost rate calculation.

UG §200.441

Same

 

 

Fund raising

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Fund raising

All sponsored project funds and Service and Storeroom Activities Funds 3E – Do Not Charge

All other funds – Code as Unallowable

Costs of organized fund raising includes financial campaigns, endowment drives, solicitations of gifts and bequests, and similar expenses incurred solely to raise capital or contributions are unallowable. For appropriate costs incurred record in a XX99 NACUBO program code to ensure they are excluded from the F&A cost rate calculation.

If a unit without a formal development office has an individual whose duties formally include some percentage appointment for fund raising:

  • For UIC and UIS, that effort must be recorded in program codes with NACUBO function XX99.
  • For UIUC, that effort must be reported as fund raising in the Activity Reporting System.

The time of department/unit heads, deans, and directors are not charged or recorded as fund raising unless fund raising is an individual's sole responsibility.

UG §200.442

Same

 

 

Gifts/Prizes/Promotional Items

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Gifts/Prizes/Promotional Items

All sponsored project funds and service and storeroom activities funds 3E - Do Not Charge

All other funds – Allowable in accordance with University policy

Unallowable on sponsored projects: costs of "customer appreciation" gifts or items used to express gratitude; costs of promotional items and memorabilia, including models, gifts, and souvenirs; costs of prizes involving "giveaways" in random drawings (i.e., "door prizes"); costs of prizes or awards related to employee performance or morale. Specialty imprinted items (including but not limited to pens/pencils/markers, mugs, folders/binders) that advertise, market, promote or sell University services are classified as promotional items and the costs of these items are not allowable on sponsored projects.

Refer to BFPP 8 Payments and Reimbursements.

See Human subject costs table.

UG §200.421

Same

 

 

Goods and services for personal use (of University employees)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Goods and services for personal use (of University employees)

All funds – Do Not Charge

Expenses of a personal nature are not allowable from University funds.

Refer to BFPP 8 Payments and Reimbursements.

Same

 

 

Graduate assistant tuition remission

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Graduate assistant tuition remission

All sponsored projects funds – Allowable where not expressly prohibited by sponsor

A federally-approved tuition remission rate is applied to the salaries of graduate assistants with waivers whose salaries are charged to sponsored projects. Also see Frequently Asked Questions.

UG §200.466

Same

 

 

Housing allowances and personal living expenses

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Housing allowances and personal living expenses

All sponsored projects funds – Restricted

All other funds– Code as Unallowable

May be allowable on specific awards under specific circumstances.

UG §200.445

May be allowable on specific awards under specific circumstances and must be approved in advance by a federal awarding agency.

For appropriate costs incurred record in a XX99 NACUBO program code to ensure they are excluded from the F&A cost rate calculation.

 

 

Human subject costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Human subject costs

All funds – Allowable

Human subject payments are allowable on sponsored projects with specific sponsor and IRB approval. In most cases, these costs must be identified by use of the 1412XX account code for all sources of funds (see note below).

Payments to Non-Resident Alien research subjects must be coded to account code 215985.

For more information refer to the following websites:

UIUC: Institutional Review BoardLink opens new window

UIC: Office of the Vice Chancellor for Research – Human Subjects and IRBsLink opens new window

Same

 

 

Insurance costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Insurance costs

Federal funds (including direct and federal pass-through) –

Restricted
All other funds – Restricted

To the extent shipping insurance is included in freight fees, this insurance cost could be charged directly to federal sponsored projects. Otherwise, direct charges to federal funds are restricted to insurance required or approved, and maintained pursuant to the sponsored agreement.

To ensure proper treatment within the F&A rate study, code the following types of coverage as unallowable: insurance on government-owned property unless specifically required and approved by the federal government, insurance against defects, and insurance on officers' and trustees' lives (in excess of the standard fringe benefits package). These costs should be recorded in program codes with NACUBO function XX99.

Other insurance – including casualty, malpractice and liability insurance and self-insurance reserves, is allowable on non-federal funds if the cost and extent of coverage is in accordance with University policy.

UG §200.310, §200.2, §200.473, §200.447

Same

 

 

Interest

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Interest

All sponsored project funds – Do Not Charge

All other funds - Restricted and code as Unallowable

Interest related to sponsored funds:
Interest is an allowable cost only when the acquisition or fabrication cost is $10,000 or more from any of the fund sources covered by this policy.

Interest related to Other Types of Funds:

Unallowable for borrowed capital or temporary use of endowment funds. Late payment penalties, though not specifically addressed under A-21, are treated as unallowable. Other kinds of interest expense should be coded as 186200 "interest expense." In the case of a federal project, interest expense and late payment charges must be assessed against a campus unit C-FOPAL.

UG §200.449

Interest related to Sponsored Funds:

Costs incurred for interest on borrowed capital, temporary use of endowment funds, or the use of the non-federal entity's own funds, however represented, are unallowable. Financing costs (including interest) to acquire, construct, or replace capital assets are allowable, subject to the conditions outlined in UG §200.449.

Interest related to Other Types of Funds:

Other kinds of interest expense should be coded as 186200 "interest expense." In the case of a federal project, interest expense and late payment charges must be assessed against a campus unit C-FOPAL.

Also see Fines & Penalties table.

 

 

Investment management costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Investment management costs

All sponsored project funds – Do Not Charge

All other funds – Restricted and code as Unallowable

Do not charge sponsored projects.

Use other funds and record in program codes with NACUBO function XX99, e.g. - the Office of Cash Management and Investments to be excluded from the F&A cost study.

UG §200.442

Same

 

 

Lobbying costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Lobbying costs

Federal funds (including direct and federal pass-through) – Do Not Charge

All other funds – Restricted and code as Unallowable

Lobbying activities are unallowable and are excluded from the F&A cost study.

The Office of Governmental Relations' expenditures are excluded from the F&A cost calculation.
Use other funds and record in program codes with NACUBO function XX99.

Some activities are not considered lobbying and are allowable such as: testifying before Congress, providing technical and factual presentations, and analyzing the impact of proposed legislation, are allowable. Traditional interactions among investigators and federal agency program officials are allowable.

UG §200.450

Same

 

 

Losses on sponsored projects

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Losses on sponsored projects

Federal funds (including direct and federal pass-through) – cannot be allocated to other sponsored projects

All other funds - Allowable

Cost overruns or overdrafts cannot be transferred to another sponsored project fund. This includes, but is not limited to, the institution’s contributed portion of cost-sharing agreements or any under-recoveries through negotiation of flat amounts for F&A costs.

UG §200.451

Same

 

 

Luncheons/Receptions (formerly business meals and meeting costs)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Luncheons/Receptions (formerly business meals and meeting costs)

Federal funds (including direct and federal pass-through) –

Restricted
Gift funds 2G and 4M – Allowable

All other funds – Restricted
 

Charges to federal projects are restricted to awards in support of symposia, conferences, or other meetings. In cases where a federal project has routine visits from individuals such as project advisory board members, the cost of meeting expenses for guests only is allowable if provided for in the approved budget. All other meeting costs must be charged to institutional funds.

Charges to all other sources of funds are restricted to meals and/or receptions in situations where "there is a substantial and bona fide business discussion during, directly preceding, or directly following the meal" (from IRS guidelines defining "business meal").

Use account code 1425XX "Luncheons/Receptions".

Same

 

 

Materials and Supplies, including Costs of Computing Devices (See also Office Supplies)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Materials and supplies, including costs of computing Devices

(See also Office Supplies)

All sponsored project funds – Restricted

All other funds – Allowable

 

UG §200.453

Materials and supplies (e.g., lab & scientific, etc.) used for the performance of an award may be charged as direct costs.

In the specific case of computing devices, charging as direct costs is allowable for devices that are essential and allocable, but not solely dedicated, to the performance of an award. This means the computing device must be:

  1. Essential for the purposes of carrying out a specific objective of the sponsored project;
  2. Above and beyond what is provided by the department; and
  3. Charged to the sponsored project in some reasonable proportion relative to how much it is used for the award.

In addition, devices may not be purchases for reasons of convenience or preference. Computing devices should be itemized in the proposal budget, budget justification and/or scope of work.

Computing devices purchased during the last six months of a project are subject to additional scrutiny and approval.

 

 

Membership costs in civic or community organizations, social, or dining clubs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Membership costs in civic or community organizations, social, or dining clubs

Federal funds (including direct and federal pass-through) – Restricted

All other funds – Code as Unallowable

Unallowable for a civic or community organization, country club, or social or dining club/organization. They must be recorded in program code with NACUBO function XX99.

UG §200.454

Costs of membership in any civic or community organization are allowable with prior approval by the federal awarding agency or pass-through entity.

Costs of membership in any country club or social or dining club or organization are unallowable.

Unallowable costs must be recorded in program codes with NACUBO function XX99.

 

 

Membership costs in professional organizations

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Membership costs in professional organizations

Sponsored project funds – Restricted

All other funds – Allowable

The costs of the University’s membership in business, technical, and professional organizations, and subscriptions to business, technical, and professional periodicals are allowable when they provide a direct benefit to the project.

Individual membership and subscription costs are unallowable.

Meeting costs that include memberships must be separated. The membership costs for individuals are unallowable and must be excluded.

If the membership costs includes a subscription, see the Subscriptions table.

UG §200.454

Same

 

 

Moving Costs

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Moving costs

 

See Relocation Costs table

 

 

 

Office Supplies (See also Materials and Supplies)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Office supplies

(See also Materials and Supplies)

All sponsored project funds – Restricted

All other funds – Allowable

Office supplies must normally be treated as indirect (F&A) costs.

To be allowable as a direct charge on a sponsored project office supplies must be used for the performance of the project, and specifically identifiable (allocable) to that project. Allocable means the direct benefit to the project can be demonstrated.

UG Appendix III, 6(b)(2)

Same

 

 

Operation and Maintenance costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Operation and maintenance costs

Federal funds (including direct and federal pass-through) – Restricted

All other funds – Allowable

Operations and maintenance costs are costs in expenses incurred by departments for repairs, maintenance, utilities, equipment installation, and remodeling. These types of costs must normally be treated as indirect (F&A) costs.

Charges to federal projects for O&M costs are restricted to those that directly benefit sponsored project(s), that do not benefit other departmental activities, and that are necessitated by special requirements of the project.

UG §200.414

Same

 

 

Overtime costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Overtime costs

Federal funds (including direct and federal pass-through) – Restricted

All other funds – Allowable

Overtime must be consistent with University policy.

Overtime is allowable to be charged for activities such as experiments that are continuous in nature and cannot be reasonably interrupted or where such overtime results in lower overall costs to the sponsor. Overtime must be pro-rated to each fund from which an employee is paid unless the overtime is clearly and demonstrably necessitated by demands placed on that employee on behalf of a specific project.

Same

 

 

Parking

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Parking

All sponsored project funds – Restricted

Costs to provide parking spaces (includes bagging meters, providing hang tags, or other methods to reserve parking spaces) for participants in a project or parking for guests/visitors attending an event supported by the project are allowable costs.

The need for parking must be associated with a specific event supported by the project charged for the parking costs. The cost to rent a "year-round" space for the convenience of having a parking space available for intermittent project use is not allowable.

It is not allowable to charge the sponsored project for pre-paid parking keys and/or hang tags that will not be quickly consumed (not allowable to charge and hold an "inventory" for convenience; the purchase must be shortly before the expected use date).

Costs to provide parking spaces to University employees are not allowable. This is a personal expense of the employee.

Same

 

 

Participant Support Costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Participant support costs

All sponsored project funds - Restricted

N/A

UG §200.75, §200.308, §200.456

Participant support costs means direct costs for items such as stipends or subsistence allowances, travel allowances, and registration fees paid to or on behalf of participants or trainees (but not employees) in connection with conferences or training projects.

Participant support costs are allowable with the prior approval of the federal awarding agency.

Prior approval is required to re-budget funding for participant support costs to any other budget category.

These participant support costs do not include costs such as payments to individuals involved in human subject testing, etc.

 

 

Patent costs incurred by non-university entities in preparing invention disclosures

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Patent costs incurred by non-University entities in preparing invention disclosures

All funds – Allowable

Costs associated with filing disclosures, reports, and other related documents to the extent that they are incurred by non-University entities that deal with patent management, are allowable.

See Patent costs incurred by the Office of Technology Management table.
 

UG §200.448

Same

 

 

Patent costs incurred by the Office of Technology Management

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Patent costs incurred by the Office of Technology Management

All sponsored project funds – Unallowable

All other funds – Restricted – code as Unallowable

The costs of the campus offices are treated as unallowable administrative costs in the F&A cost study.

Use other funds and record in program codes with NACUBO function XX99.

UG §200.448

Same

 

 

Postage (including express mail) costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Postage (including express mail) costs

Federal funds (including direct and federal pass-through) – Restricted

All other funds – Allowable
 

Postage may not generally be charged directly to federal projects. Where explicitly budgeted, postage costs directly related to the conduct of the project, including correspondence with the sponsor and project participants, surveys conducted by mail, and the like may be charged. Postage for continuation or renewal projects may be charged to a project only if a progress report is part of the proposal.

Normally be treated as indirect (F&A) costs. See UG Appendix III, 6(b)(2)

Same

 

 

Pre-award costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Pre-award costs

All sponsored project funds – Restricted

Federal appropriations funds 4Y – Unallowable

Unallowable unless provided for in agency regulations or sponsored agreement terms and conditions. Federal agencies have generally authorized the University to incur pre-award costs up to 90 days before the official starting date of a sponsored agreement (see Agreement terms and conditions table). Pre-award costs on contracts must be explicitly approved by the sponsor. Use of anticipation funds is encouraged to collect pre-award costs and reduce the occurrence of cost transfers.

UG §200.458

Same

 

 

Prizes

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Prizes

 

See Gifts/Prizes/Promotional items table

Same

 

 

Profits and losses on dispositions of capital assets

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Profits and losses on dispositions of capital assets

All sponsored project funds - Restricted

Not considered in calculating costs to sponsored projects.

Same

 

 

Program Income

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Program Income

All funds – Restricted to the source of funds that incurred the expenditure

Program income means gross income earned by the University that is directly generated by a supported activity or earned as a result of the sponsored project during the period of performance. Program income includes, but is not limited to, income from fees for services performed, registration fees and industry sponsorships collected for conferences, the use or rental or real or personal property acquired, the sale of commodities or fabricated items, and repayment of principal and interest on loans under sponsored projects.

See 16 Grants and Research Contracts – Program Income for more information.

UG §200.80 and §200.307

Same

 

 

Proposal costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Proposal costs

All sponsored project funds – Restricted to continuations and renewals

Federal appropriations funds 4Y – N/A

All other funds – Allowable

Unallowable as a direct charge to sponsored projects except for continuation and renewal proposals that include a technical report from an ongoing sponsored project which the proposal seeks to renew or continue.

Allowable if charged to institutional funds.

UG §200.460

Same

 

 

Public/Community relations

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Public/Community relations

All sponsored project funds and service and storeroom activities funds 3E – Do Not Charge

All other funds – Restricted; code as Unallowable

Public relations are efforts dedicated to maintaining the image of the institution or maintaining or promoting understanding and favorable relations with the community or public at large.

Restricted to the costs of communicating accomplishments and results of sponsored activity, including the costs of conducting general liaison with news media.

Unallowable for expenses associated with such activities, which include convocations, open houses, and non-technical displays and exhibits. These costs must be recorded in program codes with NACUBO function XX99.

UG §200.421

Same

See Advertising table

 

 

Recruiting costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Recruiting costs

All funds – Allowable

Costs of "help wanted" advertising, travel costs of applicants for interviews for prospective employment, and relocation costs incurred incident to recruitment of new employees, are allowable to the extent that such costs are incurred pursuant to a well-managed recruitment program. Where the institution uses employment agencies, costs not in excess of standard commercial rates for such services are allowable.

Charges to federal projects are restricted to those associated with employees whose salaries are charged directly to sponsored project(s), and must be pro-rated if the full salary is not charged to a given project.

UG §200.463

Same

 

 

Relocation costs for employees who stay less than 12 months

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Relocation costs for employees who stay less than 12 months

All funds – Code as Unallowable

Relocation costs for employees who stay less than 12 months are unallowable and must be recorded in program codes with NACUBO function XX99.

UG §200.464

Same

 

 

Sabbatical and other similar paid leave

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Sabbatical and other similar paid leave

Federal funds (including direct and federal pass-through) – Restricted

All other funds – Allowable to funds where salary when working is charged

Sabbatical leave costs are allowable provided they conform to the University’s written policy on sabbatical leave for persons engaged in instruction and research.

A faculty member may combine sabbatical leave salary with salary supported by sponsored project funds administered by the University as long as the combined salary does not exceed the faculty member's 100% salary for the year in which sabbatical is taken and the contracting or granting agency approves such an arrangement. For example, an eligible faculty member may take sabbatical leave for one appointment year at one-half salary and the remaining half of the salary may be paid from a grant or contract administered by the University.

UG §200.430 (h)(7)

Same

 

 

Scholarships and student aid

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Scholarships and student aid

Federal funds (including direct and federal pass-through) – Restricted

Service and Storeroom Activities Funds 3E – Unallowable

All other funds – Allowable

Restricted to training grants and fellowship awards.

For all other awards, see the Graduate Assistant Tuition Remission table.

UG §200.466

Same

 

 

Selling and marketing costs of products sold by the University

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Selling and marketing costs of products sold by the University

Federal funds (including direct and federal pass-through) – Do not charge

All other funds – Code as Unallowable
 

Unallowable for costs of any products sold by the University. Should any of these costs be incurred in institutional funds (as contrasted to auxiliary funds), they must be recorded in program codes with NACUBO function XX99.

UG §200.467

Costs of selling and marketing any products or services of the University (unless allowed under §200.421 Advertising and public relations.) are unallowable, except as direct costs, with prior approval by the federal awarding agency when necessary for the performance of the federal award.

 

 

Service Activities (recharge centers)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Service Activities (recharge centers)

 

See 22 Self-Supporting/Revenue Generating Activities - Service and Storeroom Activities

See 22 Self-Supporting/Revenue Generating Activities - Service and Storeroom Activities

 

 

Severance pay in excess of regular University practices

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Severance pay in excess of regular University practices

Federal funds (including direct and federal pass-through) – Do Not Charge

All other funds – Code as Unallowable

Severance pay which is in excess of regular University practices is unallowable. If excess severance pay is other than regular salary, the costs must be recorded in program codes with NACUBO function XX99.

UG §200.431(i)

Same

 

 

Student activity

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Student activity

All sponsored project funds – restricted and service and storeroom activities funds 3E – Do not charge

All other funds* – Code as Unallowable

Costs incurred for intramural activities, student publications, student clubs, and other student activities are unallowable, unless specifically provided for in the sponsored project.

All other funds must be recorded in program codes with NACUBO function XX99 or *funds with 1400 (Student Services) NACUBO function.

UG §200.469

Same

 

 

Subscriptions

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Subscriptions

Federal funds (including direct and federal pass-through) – Restricted

All other funds – Allowable

Costs of the non-federal entity's subscriptions to business, professional, and technical periodicals are allowable when it provides a benefit to the project and it is within the project period. When the subscription cost is included as part of a conference registration fee, documentation from the organization showing the breakout of the subscription cost must be provided.

Personal subscriptions are not allowable.

UG §200.454

Same

 

 

Telecommunication services (monthly)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Telecommunication services (monthly)

 

See Communication Costs table

Same

 

 

Telephone toll (long distance) charges

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Telephone toll (long distance) charges

All funds – Allowable

Telephone toll (long distance) charges, etc., are allowable as a direct charge only when they can be specifically identified to a particular project.

UG Appendix III – Section B(6)(b)(1)

Same

 

 

Termination vacation and sick leave payouts

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Termination vacation and sick leave payouts

All sponsored project funds – Do Not Charge

All other funds – Handle in accordance with University policy and unit practice

Termination payouts are made to compensate employees for accrued but unused vacation and sick leave. They include both lump-sum payments and appointments extended beyond the last date of service for the purpose of extending health insurance benefits. Such payments must be coded as termination vacation and charged accordingly.

The payouts must be charged to institutional funds or the Fund Type 2R termination benefit pool funds in selected colleges as appropriate.

These costs are recovered on sponsored agreements through assessment of the termination salary and sick leave fringe benefit rate, therefore termination vacation and sick leave payouts to terminating employees cannot be charged to sponsored agreements.

Same

 

 

Termination vacation and sick leave benefit assessment (fringe benefits)

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Termination vacation and sick leave benefit assessment (fringe benefits)

All sponsored project funds – Restricted

All other funds – Do Not Charge

For consistent treatment of costs, termination fringe benefit rates are charged on all employees paid under account code ranges of 211100 thru 211599 and 213000 thru 213809 regardless of employee classification. Salaries in these account codes are included in the “termination pool” and should be assessed the termination benefit.

For the actual termination “payouts,” refer to the previous section.

Same

 

 

Training and education

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Training and education

All sponsored project funds - Restricted

All other funds – Allowable

To be allowable as a direct charge to a sponsored project, the project must benefit directly from the employee's training. If the training benefits multiple projects, the cost of the training must be allocated proportionately.

UG §200.472

Same

 

 

Travel costs

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Travel costs

All sponsored project funds – Allowable in accordance with agreement and University policy

All other funds – Allowable in accordance with University policy

Travel costs in excess of the University travel policy applied to state funds are unallowable under A21.

Record in program codes with NACUBO function XX99.

See 15 Travel for types of travel costs reimbursable under University policy. For travel during sabbatical see 8.2.1 Request Reimbursement for Domestic or International Employee Travel and Business Meals. Costs must meet allocability and allowability criteria to be charged as a direct cost on a sponsored project. Many of the expenditure types listed in the University travel policy would normally be considered as indirect costs on sponsored projects (e.g., internet, laundry, etc.) and therefore not allowable as direct costs on sponsored projects.

Also see Business Travel.

Travel costs in excess of the University travel policy applied to state funds are unallowable under UG.

Rest is the same
 

 

 

Travel for federal projects

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Travel for federal projects

Travel for federal projects

Federal funds (including direct and federal pass-through) – Allowable in accordance with agreement and University policy

For federally sponsored projects:

  • Each trip, including those made with personal car, must be authorized in advance by the head of the unit, and by the college if required by college policy (see 15 Travel).
  • Domestic travel always includes travel within the United States, its territories, and possessions. Refer to the sponsoring agency policies for possible additional destinations that may be included in domestic travel.
  • Foreign travel may require prior sponsor approval where specified in agency guidelines or award terms and conditions. If such approval is required, principal investigator must request written permission from the sponsor's contract and/or grants officer in advance of any foreign trip. To be assured of timely approval, the permission should be requested 60 days in advance.
  • Reimbursement request for travel expenses should include specific documentation indicating how the travel directly benefited the project.
  • Business meals reimbursed to the employee while in travel status should be recorded with account code 1425XX (Luncheons and Receptions).
  • Air transportation to, from, between, or within a country other than the United States must be by a US flag air carrier if such service is available. For travel purchased from a non-US flag air carrier to be allowable (please refer to the sponsoring agency's grants administration manual or the individual agreement), the justification must be documented on the expense report. Refer to “Fly America Act.”
  • Travel paid with federal funds cannot exceed the lowest available commercial coach fare, whether the actual mode of transportation is commercial airlines, University aircraft, personal automobile, train, etc.
  • The above two conditions must be met irrespective of cost, convenience, or personal travel preference.

UG §200.474 for complete details.

Same

 

 

Visa/Passport fees

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Visa/Passport fees

All sponsored project funds – Restricted

Short-term, travel visa costs (as opposed to longer-term, immigration visas) are generally allowable when issued for a specific period and purpose, and therefore can be clearly identified as directly connected to recruitment of personnel for a sponsored award. For the costs to be directly charged to an award, they must:

  • Be critical and necessary for the conduct of the project;
  • Be allowable under the applicable cost principles;
  • Be consistent with the University’s cost accounting practices and entity policy; and
  • Meet the definition of “direct costs” as described in the applicable cost principles.

Long-term immigration visas are still unallowable and cannot be charged to sponsored awards.

UG §200.463

Same

 

 

Warranties and Extended Warranties

 

Cost Treatment Treatment of Costs under OMB Circular A-21 (Effective for awards issued prior to December 26, 2014) Treatment of Costs under OMB Uniform Guidance (Effective for awards issued on or after December 26, 2014)

Warranties and Extended Warranties

All sponsored project funds – Restricted

Allowability of a warranty will be determined on a case-by-case basis. Equipment warranties on a sponsored project may be allowable, if the pieces of equipment were also purchased on that project. For the cost to be allowable the benefit to the project must be documented and justified. The costs must be prorated based on the percentage the equipment is used on the project and prorated to coincide with the award period. This charge may not be allowed by some sponsors' terms and conditions.

Allowability of a warranty will be determined on a case-by-case basis. Equipment warranties on a sponsored project may be allowable if the pieces of equipment were purchased on the same project, the equipment is specifically mentioned in the scope of work and budget/budget justification, and/or other documentation can support the essential nature of the equipment for the project.  Allocability should be determined in a manner appropriate for the relative benefit to the project (i.e. usage) and prorated to coincide with the award period. This charge may not be allowed by some sponsors per the terms and conditions of specific awards.

Uniform Guidance §200.413Link opens new window
Uniform Guidance §200.414Link opens new window

Last Updated: August 28, 2020 | Approved: Senior Associate Vice President for Business and Finance | Effective: June 2016

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