University of Vermont

Cost Accounting Services 

Cost Accounting Standards Direct charging examples of typical indirect costs
The following examples are intended to provide guidance on what may be considered an unlike circumstance of a typical indirect cost scenario.
These examples are not exhaustive nor are they intended to to imply that direct charging would always be appropriate for the situations illustrated.

Administrative or Clerical Staff

Administrative and clerical activities which may be justifiable as being an unlike circumstances are:
  • Large, complex projects such as EPSCOR and NIH program projects which entail assembling and managing teams of investigators
  • Projects which require signficant data accumulation
  • Projects which require making travel and meeting arrangements for large number of participants
  • Projects whose principal focus is the preparation and production of manuals and large reports
  • Projects that are geographically inaccessible to typical departmental administrative services
  • Projects requiring project-specific database management, individualized graphics preparation, human or animal protocols, or multiple project-related investigator coordination and communications;
Books and Subscriptions
Books, subscriptions, reprints or a copy of article charges which may be justifiable as being unlike circumstances are:
  • Purchase of a software, equipment or similar manual to improve efficiency and/or results of PI or lab personnel use of software or equipment used in the specific research project.
  • Book associated with a specific research technique or aspect of the research project that will introduce efficiencies to the research, improve quality of results, improve results from a specific piece of research equipment or improve results from a research experiment.
  • Books which are not available from the library or from other sources.
  • Specific books needed so often that a library copy is not sufficient.
Dues and Memberships
Dues and membership fees which may be justifiable as being an unlike circumstance are:
  • The registration costs for a PI to attend a specific meeting or conference to present research findings includes membership fees but it is more costly to attend as a non-member.
  • The request for a proposal requires the individual to hold a current membership.
Copier Charges, Copy Cards
General copying  may not be charged directly to a sponsored agreement. However, the use of specific codes on a department copier is an acceptable methodology to identify copying charges for a sponsored agreement. The copying charges must be to solely to advance the work under the sponsored agreement.

Equipment Maintenance Agreements/Service Contracts
General purpose equipment maintenance or service agreements may not be charged directly to a sponsored agreement. Maintenance agreements  or service contracts on scientific/technical equipment which are used to specifically to advance the purpose of a sponsored agreement may be direct charged if either one of the two following allocation approaches are used:
  • Actual usage of the related equipment is tracked e.g. a log and the usage information is the basis for allocation
  • The PI can apply the proportional benefit rule without undue effort or cost to the applicable sponsored agreements
Facility Costs
Facility costs such as building costs, utility costs, space rental charges and work orders
which may be justifiable as being an unlike circumstance are:
  • The sponsored agreement is classified as off-campus and the facility costs are not paid for by the University
  • Special arrangement and alterations costs are specifically incurred for the sponsored agreement
General Office Supplies
Office supplies may be appropriate as a direct cost if the work takes place at a remote site or the scope of work requires an excessive amount of office supplies for tasks unique to the project. Projects that require extensive workshops or training seminars frequently need excessive office supplies to develop handouts for the participants. The following examples of justifications for office supplies that may be considered an unlike circumstance:
  • Significant supplies for mailings, brochures and reports will be used for a sponsored agreement.
  • Significant office supplies will be used to fulfill a sponsor's request to send Standard Operating Procedure manuals to other agencies
  • An unusually large amount of office supplies are required to prepare brochures and educational training materials for workshops.
  • Envelopes used to mail an unusually large number of research questionnaires
  • Paper, folders, and page charges for producing manuals, conference materials, human subject files, manuscripts, survey instruments, scientific data when such activity is a primary objective of the project
  • Office supplies for participants in an externally funded conference or seminar hosted by the campus. Example: Conference grants
Personal Computers and Other Electronic Devices
In all cases, the primary usage (at least 95%) of the computer must be used in the actual conduct of the research. Examples of computer uses which may be considered exceptional and a basis for computer purchases being directly charged to a sponsored agreement are:
  • Controlling an instrument
  • Acquiring data from an instrument
  • Numerical calculations and simulations
  • Image and video analysis
  • Data analysis and manipulation
  • Data mining
  • Writing computer code
  • Data storage for the sponsored projects
  • Preparation of testing materials and recording of participant responses
Postage may be appropriate as a direct cost when it is excessive, involves requirements to mail to foreign countries, and can be tied to scope of work as an unlike circumstance. An example of a justification that may be considered an unlike circumstance is:
  • Postage is required to mail scientific materials e.g. biological samples in dry ice.
  • Postage to conduct research surveys or patient follow-up letters
Note: Postage expenses include US Mail, Federal Express, UPS, etc. All shipping costs for purchases should be charged to the same account code as the items being purchased. The difference between postage (F&A) and freight (direct) is driven by the item(s) being sent not the means by which it is sent.

Telephone and Internet Access

OMB Circular A-21 states that local telephone costs are normally treated as F&A costs. The University interprets local telephone costs to include local telephone service charges for voice/data access. cellular phone costs and subscription fees for internet access. Under exceptional circumstances, local telephone expenses may be directly charged to a sponsored agreement. Exceptional circumstances may apply when:
  • A dedicated line used to conduct a telephone survey.
  • A phone line used exclusively to manage a multi-site research project.
  • Local telephone Service - A hotline or crisis line that is specifically required by a sponsored agreement
  • A dedicate fax machine and voice port is necessary to ensure confidentiality of transmitted patient information
Procedures must be in place to ensure that the particular line is used exclusively for the project or activity to which it is being directly charged.

Last modified March 17 2012 09:25 AM