SECTION E OF A-21

A good understanding of Facilities and Administrative (F&A) costs, or indirect costs as they were previously known, is essential to accurately allocate costs for any sponsored agreement. Our more detailed examination of the next three sections, sections E, F, & G of A-21 will help you better understand what is included in these costs.  Your staff support employees will examine this in greater depth in their training so that they can better assist you in allocating costs.  If you would like to have a greater understanding of these costs, please go to their training syllabus for links to these sections of A-21.

In general, an F&A cost is one which is incurred for common or joint objectives and thus cannot be readily identified with a specific sponsored agreement.   For example, how could you allocate the cost of air conditioning for your building to one specific sponsored agreement - especially when it contains multiple labs, classrooms, and offices?  Or how about the paper for the copier which is used by everyone in the main administrative office?  This section is designed to provide guidance to the institution in the development of an F&A rate.  Section F identifies these costs that should be included in the F&A portion of the budget for inclusion in the F&A rate study.

For any cost to be distributed equitably to all sponsored agreements, a set of criteria has been developed within A-21.  First is the base period, which is the period of time within which the costs were incurred.  Normally this coincides with our fiscal year.

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