Kris is correct if your F&A is on the total modified direct costs.  If your
institution's F&A is only on salary and wages, you cannot charge on the
subcontract amount.

Regards,
Pat b.

------------------------------
Patricia D. Buennemeyer, CRA
 Director, Sponsored Programs
 James Madison University
MSC 5728
Medical Arts West, Suite 26
 Harrisonburg, VA 22807
 Phone: 540.568.6872
 FAX: 540.568.6240

-----Original Message-----
From: Research Administration List [mailto:xxxxxx@HRINET.ORG] On Behalf Of
Rhodes, Kris E
Sent: Wednesday, September 22, 2004 6:14 PM
To: xxxxxx@HRINET.ORG
Subject: Re: [RESADM-L] Subcontractor Costs

Hi Greg,

You should treat the entire cost of the subcontract as a direct cost in your
institution's budget.  You will only charge F&A on the first $25,000 of the
subcontract.  Here are two examples that may make it clearer -

If the subcontract is $12,000 direct cost and $6,000 in indirect the total
cost in year one for budget purposes is $18,000.  You will apply your F&A to
entire $18,000.

If the subaward is the same in year two, you should only charge F&A on
$7,000.

I assume you are with a non-profit the referenced for the subaward cap on
F&A recovery is addressed in A-122 D.3.f under the Multiple Allocation
Method for distributing F&A discussion.  The key is that the circular does
not reference just direct cost as the base for distributing, it states the
first $25,000 of the subaward.

Kris Rhodes
Associate Director
Office of Sponsored Projects Administration
University of Kentucky

-----Original Message-----
From: Research Administration List on behalf of Doyle-Wandell, Greg
Sent: Wed 9/22/2004 5:15 PM
To: xxxxxx@HRINET.ORG
Cc:
Subject: [RESADM-L] Subcontractor Costs

 Hi

 I'm working on a R01 application and need some help answering a
question
 about how to treat subcontractor's F&A.  The question is: do I treat
the
 subcontractor's total expenses (direct and F&A) as my direct
expense, or
 just their direct costs?

 Thanks

 Greg

 ============================
 Greg Doyle-Wandell
 Director of Sponsored Programs
 J. Craig Venter Institute, Inc.
 9704 Medical Center Drive, 4th Floor
 Rockville, Maryland  20850

 Phone: (240) 268-2755
 Fax: (240) 268-4000

 Email: xxxxxx@venterscience.org

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