The first section you must understand is Section D, Direct Costs.  This short section identifies the basics of direct costs and links the application of direct costs to sponsored agreements.

The next three sections which with you must be familiar all deal with F&A costs - and this is the area within which most researchers have encountered difficulties.  Section E discusses F&A costs with a general discussion followed by a detailed examination of the criteria for distribution to cost allocation pools.  Section F, Identification and Assignment of F&A Costs, defines F&A Costs, then examines depreciation and use allowances, interest, operation and maintenance expenses, general administration expenses, departmental administration expenses, sponsored projects administration, library expenses, student administration and services, and concludes with a discussion of the offset for F&A expenses otherwise provided for by the Federal Government.  Section G, Determination and Application of F&A Cost Rate or Rates, delves further into F&A Costs.  It begins with discussions of cost pools, distribution basis, negotiated lump sums, predetermined rates, negotiated fixed rates, provisional and final rates, fixed rates for the life of the sponsored agreement, limitations on reimbursement of administrative costs, alternative methods for administrative costs, individual rate components, and the negotiation and approval of F&A costs. This entire discussion is the basis for the indirect cost rate negotiations between TAMUS and DHHS, our cognizant agency.

Click the right arrow below to proceed