I agree with what Mr. Chermside wrote here. To add to what he said, if
in doubt, write a letter to the grants manager at the agency requesting
clarification. I have seen auditors who have deemed as unallowable
costs that were generally budgeted and accepted (via funding the costs).
Their logic was that part of their audit involves a review of the
granting agency's administration of their awards. Just because a cost
was authorized via a budget document doesn't make it allowable under A-21.
However, if they have specific documentation concerning a cost, they
will usually accept it.
Greg Schmidt
Herbert B. Chermside wrote:
> A-21 applies solely to federal funds, whether prime awards or
> flow-down. Many institutions have internal or other externally imposed,
> policies on allowability which are similar, but usually also have funds
> without these limitations. Note that some costs allowable under A-21must
> be indirect rather than direct costs; some of that depends on the
> structure
> of your F&A agreement with your cognizant agency.
>
> If the programs you mention are federally funded, A-21 applies, as to
> charges allowable against federal funds. The projects might have at
> their
> disposal funds which do not have these limits. They must clearly
> differentiate the accounts to which the charges are made.
> Allowability of
> costs is directly tied to funding sources.
>
> Certain costs which are largely unallowable as direct costs might be if
> specifically budgeted and justified in proposals and the proposal is
> accepted by the funding agency. F 6 (b) costs are an example; in some
> cases they may be directly related to the project.
>
> Sounds as if you need clear internal rules on what may and what may
> not be
> spent on projects, with provision for clear documentation of "grey"areas.
>
> Chuck
>
>
>
>
> At 03:36 PM 3/2/2004, you wrote:
>
>> We have a department on campus that runs workshops and externally
>> sponsored programs to promote such things as minorities in engineering,
>> women in engineering, programs to improve student retention and so
>> on. Their spending habits give our accounting department grey hair.
>> They
>> purchase items such as small gifts and promotional materials for these
>> programs and gifts for volunteers that act as peer mentors etc.
>>
>> The question is this, since these are non allowable expenditures as per
>> A-21, does A-21 apply to programs of this nature and if so how do you
>> reconcile these kind of expenditure activities which are essential to
>> the
>> operation of these types of programs?
>>
>> Mike
>> Michael P. Gilles
>> Senior Contracts Analyst
>> Research & Sponsored Programs
>> Michigan Technological University
>> 1400 Townsend Drive
>> Houghton, MI 49931
>> Ph: 906 487-2225 Fx: 906 487-2245
>>
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>
>
> Herbert B. Chermside, CRA
> Virginia Commonwealth University
> PO BOX 980568
> Richmond, VA 23298-0568
> Voice: 804-827-6036
> Fax 804-828-2051
> e-mail xxxxxx@vcu.edu
>
>
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