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What Is the Indirect Cost Rate Agreement

To cover the indirect costs associated with federal grants, most organizations must negotiate a CI with the federal agency that provides the preponderance of funding, or health and social services in the case of colleges and universities. NSF is the competent body and negotiates formally negotiated indirect cost rate agreements (INAs) for approximately 110 organizations. Organizations for which the NSF is the organization with rate knowledge must submit proposals to update their ICRs on a regular basis (usually annually). CAAR is responsible for negotiating and delivering KPIs for NSF Cognizant Award winners. The CAAR does not negotiate ROI for organizations that are not direct beneficiaries of NSF funds (e.B. sub-recipients) or for foreign organizations. • NiCRA allows the grant or contracting officer to quickly calculate the appropriate allocation of indirect costs related to a project, simplifying the entire process. Once the review and negotiation is complete, NSF sends a letter with the results of the negotiation, also known as NICRA, which is signed by the award winner. As soon as the winner signs and returns the collective agreement, the proposal is closed.

Alternatively, CAAR may make a recommendation to issuing branches for a premium-specific rate. In this case, the type of sentence, percentage and basis of the application must be indicated in the letter of assist. CAAR negotiates KPIs for organizations for which NSF has rate knowledge. The AARC also provides indirect cost advice to the Grants and Agreements Division (DGA) and the Acquisitions and Cooperative Support Division (DACS). The DGA and DACS negotiate the supply agreement with the procurement organizations. Indirect costs are costs that cannot be easily identified with a specific cost target (e.g. B direct organisational activity or project), but which are nevertheless necessary for the general functioning of an organisation. Examples of indirect costs include the salary and related expenses of people working in accounting, human resources, purchasing functions, rent, depreciation and utilities. Indirect costs are generally not charged directly to a federal arbitration, but are distributed equitably among all activities of the organization. Indirect costs are usually charged to federal premiums through the development and application of an indirect cost rate (EI). Organizations that have premiums with interim maximum rates must submit indirect cost proposals that have been reconciled to the financial statements within six months of the end of each fiscal year in which they invoiced indirect costs to a government-funded arbitration award.

A fixed amount limits organizations to the “amount” of indirect costs indicated in the approved budget. It is not subject to any adjustment. A predetermined fixed CI is a standing rate established for a separate period of time corresponding to one or more fiscal years of the organization. Organizations have the right to charge NSF premiums at the predetermined fixed rates set out in the award documents. However, if negotiations between the organization and the NSF (or the relevant federal agency, otherwise the NSF) result in changes to the organization`s CI during the award period, the organization may charge the premium at the current renegotiated rate for direct expenses, subject to the provisions of the NSF V.D. Allocation and Administration Guide • If a beneficiary/contractor has already negotiated indirect costs with the USG. Because it is difficult for a federal agency to determine the indirect costs associated with delivering a program or project. Since indirect cost recovery for NSF awards may be limited and may require post-award adjustments, recipients must ensure that they understand the limitations related to indirect cost recovery. These restrictions are indicated in the letter of recommendation or the ARNI and include: the type of tariff, the percentage and the basis of application. DESCRIPTION – A fixed interest rate has the same characteristics as a predetermined interest rate; However, the difference between the costs used to set the fixed rate and the actual costs incurred in the year covered by the fixed rate shall be classified as a carry-forward. The deferral is used as an adjustment to the current rate so that the beneficiary/entrepreneur can repay either a recovery as part of the recovery or a surplus in a subsequent year. For winners who have never received a NICRA, the 2 CFR 200,414(f) allows the use of a 10% ICR calculation on MTDC.

Pass-through entities can also apply this set. If this de minimis approach is chosen, the 10% rate must be applied consistently to all federal premiums until the company decides to negotiate a BRI. If an organization that intends to grant a substantial surtax to NSF does not have an ongoing negotiated collective agreement with a federal agency and does not opt for the de minimis approach described above, caar will ask the organization to support its proposed BRI by submitting a proposal for indirect costs (see Indirect Cost Proposal Submission Procedure). Based on various available information (e.g. B, historical information on costs and the amount of financing requested), CAAR negotiates indirect cost financing, usually in the form of rates. Occasionally, if the NSF plans to give the organization only one or a few rewards, or if the total amount expected is not significant, the CAAR may refuse to negotiate a CI, but instead recommend a specific amount for the price. Winners must have a detailed understanding of their conditions in relation to the BRI or assign specific rates in order to correctly calculate indirect cost recovery costs and possible adjustments after award. A document published to reflect an estimate of the indirect cost rate negotiated between the federal government and the organization of a recipient or contractor, reflecting the indirect costs of the organization (facilities and administrative costs) and the ancillary costs of utilities, which will be the same in all agencies in the United States […].

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