basics of cost alloc.. - National Optical Astronomy Observatory PDF
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Presented by Karen M. Wilson, CRA CCEP Chief Compliance Officer NOAO The information presented in these slides including any opinions, findings, and conclusions or recommendations are the expressed views and opinions of Karen Wilson as the NOAO Chief Compliance Officer and as a compliance representative of the Association of Universities for Research in Astronomy (AURA) and do not necessarily reflect the views of the National Science Foundation (NSF). 1 KMW December 2011 Why? Allowable, Unallowable, Reasonable and Necessary Costs History Difference between award types – grants, contracts and cooperative agreements and some general terminology 2 CFR Part 230 (OMB A-122) Allowable Costs and specifics for Indirect Cost Rate Determination (will include some short discussion but not work through a submission) True False Questions KMW December 2011 2 As PIs, Directors, Managers, Procurement Officers and Supervisors ◦ Authorize Expenditures/Commit AURA ◦ Approve Time and Effort Reporting ◦ Set Policy and Procedures ◦ Involved with Audit and or Risk ◦ Delegate Responsibility ◦ Budget Allocation ◦ Fraud KMW December 2011 3 RESOURCE Code of Federal Regulations (CFR) Office of Management and Budget (OMB) National Science Foundation (NSF) Federal Acquisition Regulations (FARs) Cooperative Agreement (CA) Cooperative Support Agreements (CSA) Cooperative Agreement Financial & Administrative Terms and Conditions (CA-FATCs) Federally Funded Research and Development Centers (FFRDCs) Indirect Cost Rates (IDC) Facilities and Administration Rates (F&A) General and Administrative Rates (G&A) Modified Total Direct Cost Rate (MTDC) Society of Research Administrators (SRA) Research Administrators (RA) KMW December 2011 4 RESOURCE Address the legitimacy of the cost charged against a specific award Based on specific guidelines of the sponsor and according to the cost principles and established policies and practice ◦ 2 CFR Part 230 (OMB A122) ◦ NSF Administrative and Award Guide ◦ NSF CA-FATC ◦ Program Specific ◦ Cooperative Agreement or Award Document ◦ Aura Policies and Procedures How you procure items and services ◦ 2 CFR Part 215 (OMB A110) ◦ AURA Procurement Policies How costs are audited ◦ OMB A133 Guide to Singular Audits KMW December 2011 5 Time and Effort Risk Assessment Internal Controls and Approvals Access to Information Systems ARRA Compliance Conflict of Interest Reasonable and Necessary Sub-recipient monitoring sub-award files and other large procurements documented for compliance KMW December 2011 6 Costs must be reasonable Costs must be given consistent treatment through applications of generally accepted cost principles appropriate to the circumstance (in other words – classified the same throughout the financial system) Cost must conform to limitations or exclusions set forth in the sponsored agreement or the Federal Cost principals A-122 KMW December 2011 7 Costs must withstand public scrutiny ? What would a reasonable person pay ◦ Procurement validity – Price Analysis ◦ Conform to the budget or Program Plan? ◦ Customary Necessary to perform the research or project ◦ “Not just that we have always allowed it” ◦ Transparency is important ◦ Public Documentation – Websites ◦ Stewardship of Public Funds KMW December 2011 8 First it must be allowable. ◦ Allowable under the cost principles of 2 CFR Part 230 (OMB A-122) and under the terms of the specific award; Evaluated against the criteria – Incurred solely to support or advance the work of a specific award. ◦ Allocable in that the cost can be associated with a high degree of accuracy to the sponsored project ; ◦ Must be a means for assessing the cost to one or more cost objectives in a reasonable and realistic proportion to the benefit provided. Direct or Indirect Cost Written documentation for treatment of cost – financial systems KMW December 2011 9 How are Allowable Costs RESOURCE Determined? Allowable: Under the agreement, regulations and public laws Reasonable: A prudent person would have purchased this item and paid this price. Recognized as ordinary and necessary Reasonable in nature and amount Competition policy (3 quotes etc.) Allocable: They can be assigned to the activity on some reasonable basis Consistently Treated: Like costs must be treated the same in like circumstances, as either direct or F&A costs Be consistent with policies and procedures: applied uniformly to both federally‐Iinanced and other activities of the organization Conform: to any limitations or exclusions set forth in the cost principles or the award Necessary : to the overall operation of the organization and or award Documented!!!! If a cost cannot meet the above criteria, it is NOT ALLOWABLE, no matter what it is for. KMW December 2011 10
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