1 / 21

INDIRECT COST RATES

INDIRECT COST RATES. WHAT ARE INDIRECT COST RATES???? Indirect Cost Pool-How Deep? Indirect Cost Base-How Large? Indirect Cost Rate-How High?. AGENDA. Who Are We- Indirect Cost Branch Definitions Why Indirect Cost Rates Are Needed; Including An Example

tait
Download Presentation

INDIRECT COST RATES

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. INDIRECT COST RATES • WHAT ARE INDIRECT COST RATES???? • Indirect Cost Pool-How Deep? • Indirect Cost Base-How Large? • Indirect Cost Rate-How High?

  2. AGENDA • Who Are We- Indirect Cost Branch • Definitions • Why Indirect Cost Rates Are Needed; Including An Example • The Negotiation Process; Including How To Start The Process

  3. INDIRECT COST BRANCH • The Office At NIH With The Responsibility Of Negotiating INDIRECT COST RATES With COMMERCIAL ORGANIZATIONS Receiving Awards (Grants & Contracts) With NIH • SBIR & STTR

  4. TYPES OF COSTS • DIRECT COSTS: Easily Identified With A Specific Project: • Direct Salaries & Wages • Materials & Supplies • Consultants & Subcontracts

  5. TYPES OF COSTS (Continued) • INDIRECT COSTS: Not Easily Identified With A Specific Project • Fringe Benefits • Overhead • G&A

  6. FRINGE BENEFITS • Allowances And Services Provided To Employees • Pd Abs (Vacation, Holiday & Sick Leave) • Payroll Taxes • Pension Plan • Group Ins (Health, Life & Disability)

  7. OVERHEAD COSTS • Indirect Costs Relating To The Performance Of A Project • Overhead Labor (e.g.; supervision, general meetings) • Fringes On Overhead Labor • Facility Costs & Depreciation • General Lab Supplies

  8. G&A COSTS • Indirect Costs Associated With The Overall Management Of The Company • Executive & Administrative Labor • Fringe Benefits On G&A Labor • Professional Fees (CPA) • Office Supplies

  9. IDC RATES ARE NEEDED • To Provide A Uniform Method • Funding Indirect Costs • Charging Indirect Costs • To Provide An Equitable Allocation Of Indirect Costs Across All Projects

  10. INDIRECT COST RATE • A Method For Allocating Indirect Costs To Projects • Ratio Between Indirect Costs (Pool)And An Equitable Base

  11. TYPES OF RATES • Three Types Of Rates • Provisional Rates • Based On Projections For Current FY • Used For Funding & Charging • Final Rates • Based On Actual Costs • Charges Adjusted To Reflect Final Rates • Ceiling Rates • Final Rates Cannot Exceed

  12. INDIRECT COST RATE SYSTEMS • One Tier System: One Pool • Fringe Benefits, Overhead & G&A • Two Tier System: Two Pools - Typically • Fringe Benefits • Overhead and G&A

  13. INDIRECT COST RATE SYSTEMS (Continued) • Three Tier System: Three Pools • Fringe Benefits • Overhead • G&A

  14. INDIRECT COST RATE (Example) • EXAMPLE COMPUTATION- TWO TIER • Fringe Benefit Rate • POOL: Pd Abs, Payroll Taxes, Pension & Group Insurance • BASE: Total Labor-Direct & Indirect Excluding Pd Abs • RATE: POOL Divided By BASE

  15. INDIRECT COST RATE (Continued) • EXAMPLE-CONTINUED • Indirect Cost Rate • POOL: Overhead & G&A Costs • BASE: Total Direct Cost Excluding Equipment & Subcontract Costs In Excess Of $25,000 Per Subcontract Per Project Period • RATE: POOL Divided By BASE

  16. NEGOTIATION PROCESS(Step 1) • CONTACT INDIRECT COST BRANCH-RAY WOODRUFF: • When: Notification Grant/Contract Is Going To Be Awarded • How: Via • E-Mail: rw8u@nih.gov • Fax: 301/402-7180

  17. NEGOTIATION PROCESS (Step 1 -Continued) • Information Needed: • Representative Name & E-Mail Address • Company Name & Address • Grant/Contract Number • Grant/Contract Specialist’s Name

  18. NEGOTIATION PROCESS(Step 2) • Indirect Cost Branch Requests Indirect Cost Proposal: • Letter: Via E-mail

  19. NEGOTIATION PROCESS(Step 3) • Indirect Cost Proposal Submitted • Indirect Cost Branch Reviews Proposal • Indirect Cost Branch Follows-up With Questions To Company

  20. NEGOTIATION PROCESS(Step 4) • NEGOTIATES RATES WITH COMPANY • Typically By Phone • Rate Agreement Is Issued Or Rate Memo Is Sent To Grant Specialist

  21. FINALLY • WE ARE DONE! • NOW THAT WAS NOT SO BAD! • WAS IT? • GUESS WHAT? • WE ARE GOING TO DO IT AGAIN NEXT YEAR!

More Related