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Allowable Costs

Allowable Costs. Cost shout out!. Topics of the session:. Definitions and Sources Types of costs Selected items of costs. What are Cost Principles?. Set of government-wide rules Applicable to all Federal grants Define conditions for charging costs Allowable & unallowable costs

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Allowable Costs

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  1. Allowable Costs

  2. Cost shout out!

  3. Topics of the session: Definitions and Sources Types of costs Selected items of costs

  4. What are Cost Principles? • Set of government-wide rules • Applicable to all Federal grants • Define conditions for charging costs • Allowable & unallowable costs • Direct , Shared & Indirect costs • Descriptions

  5. What are Cost Principles? Principles also discuss time distribution and allocation of personnel services

  6. Cost Principles 2 CFR 215 - OMB Circular A-21 Educational Institutions 2 CFR 225 - OMB Circular A-87 State/Local/Indian Tribes 2 CFR 230 - OMB Circular A-122 Non-Profit Organizations 48 CFR Part 31 Commercial Organizations

  7. Cost Principles

  8. Other Regulations • Uniform Administrative Standards • 29 CFR 97 • 29 CFR 95 • WIA Regulations • Grant Agreement • SGA (Solicitation for Grant Applications) • Employment Training and Guidance Letters

  9. Standards for allowability of costs • Cost must be reasonable, necessary, allocable and to the benefit of the grant Found in circulars and Federal regulations Apply to all costs charged to Federal funds

  10. Standards for allowability of costs • Reasonable & Necessary • “proper & efficient” • “prudent person theory” • Allocable • Clearly benefit program • Both direct & indirect costs

  11. Standards for allowability of costs • Consistent with GAAP • Consistent with the rules • Consistent treatment across time • Cannot be used as match • Documented and traceable • Program regulations may have prohibited costs • 20 CFR 668.340-350 • 20 CFR 667.260-268

  12. Types of costs • Allowable • Curriculum development, classroom supplies and equipment • Unallowable • Entertainment, losses, fines and penalties, contingency reserves • Allowable with conditions • Memberships, pre award costs, interest costs

  13. Types of costs • If prior approval requirement exists • Before incurring cost • Must be requested in writing • Must be approved • Approval requests to Grant Officer

  14. Selected items of costs • TAACCCT allowable activities • Hiring and/or training additional instructors or staff • Purchasing or upgrading classroom supplies and equipment • Cost associated with implementing changes in the time or scheduling of courses • Other

  15. Selected items of costs • TAACCCT unallowable activities • Participants’ tuition, books, fees, and other personal expenditures (supportive services) • Incentive payments • Participants’ wages • Stipends for wage replacement of participants • Purchase of real property • Construction • Supplanting

  16. 300 baseball game tickets to giveaway at job fair?

  17. Entity paid for settlement on wrongful termination law suit

  18. Entity paid for settlement on wrongful termination law suit

  19. Question

  20. Training Resources For additional training: http://etareporting.workforce3one.org For the Indirect cost determination guide: http://www.dol.gov/oasam/programs/boc/costdeterminationguide/cdg.pdf

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