Facilities & Administrative Rates

Question 1

Cost Accounting Standards

CAS 501 : Consistency in Estimating, Accumulating and Reporting Costs

Answer 1

Requires that costs must be proposed in the same way that they are treated in an institution’s accounting system.

Question 2

Cost Accounting Standards

CAS 502 : Consistency in Allocating Costs Incurred for the Same Purpose

Answer 2

Costs incurred for the same purpose, in like circumstances, must be treated consistently as direct or indirect costs.

Question 3

Cost Accounting Standards

CAS 505 : Accounting for Unallowable Costs

Answer 3

Provides guidance for accounting for unallowable costs for those in the institution responsible for preparation of the F&A proposal

Question 4

Cost Accounting Standards

CAS 506 : Cost Accounting Period

Answer 4

Requires that the cost accounting period for costs accounting purposes be the same as an institution’s fiscal year.

Question 5

Modified Total Direct Cost (MTDC) basics

Answer 5

> MTDC defined in 2 CFR 200

> Includes all direct costs including salaries, fringe benefits, materials and supplies, services, travel, subcontractors up to first $25k in expenditures

> Excludes equipment, capital expenditures, patient care costs, tuition remission, rental charges, scholarships/fellowships, subcontractors exceeding $25k in expenditures

Question 6

F&A Rate development method available to Universities with direct Federal funding under $10 million per fiscal year.

The institution’s most recent annual financial statements and supporting documentation are the basis for determining the F&A rate.

The institution has the option to compute a rate using either a S&W base (salaries and wages) or the MTDC base.

Answer 6

Simplified Method

Question 7

F&A rate development method required for grantees that receive greater than $10 million of Federal funding in a fiscal year.

Discrete allocations of facilities and administrative cost pools are required in developing F&A cost rates.

Administrative components of the rate are limited to 26% of the total rate.

The rate includes a 3.6% allowance for administrative efforts of faculty and other professionals.

Answer 7

Cost Distribution Method

Question 8

Outlines the methodology for developing the F&A rate:

Indirect Costs Supporting Organized Research / Direct Costs of Organized Research

Answer 8

OMB Circular 2 CFR 200

Question 9

Cognizant Agencies (x2)

Answer 9

ONR and HHS

Question 10

Types of F&A Rates (x4)

Answer 10

Predetermined:
Rate established for period; no carry forward provision

Fixed Rate with a Carryforward Provision:
Rate established for period; under-over recovery adjusted during next period

Provisional:
Estimated rate used until actual rate is determined

Negotiated:
Rate applicable to a specific past period with no adjustments

Question 11

Excluded from MTDC (8)

Answer 11

• equipment
• tuition
• scholarships, fellowships
• capital expenditures and renovations
• rental costs
• patient care
• participant support costs
• portion of each sub in excess of $25k