Must an organization have a Federally approved indirect cost rate to include indirect costs (F&A Costs) in the Total Costs requested in the application?
This is a difficult question. An applicant organization is not required to have an indirect rate agreement to receive an award. But it is very difficult to allocate indirect costs to these projects except through an indirect cost pool approved by a Federal cost accounting entity. Any allocation of indirect costs must be done consistently across the entire institution, for all projects. Once an institution takes the route of allocating what would be indirect costs as direct project costs, any future negotiation of an approved indirect cost rate becomes extremely complicated. AHRQ would encourage an institution new to the Federal funding environment to develop a provisional indirect rate and prepare to submit this as the proposed rate for Federal approval when it receives its first grant award (See previous question and answer).
Related Questions
- If an organization does not have a federally approved indirect cost rate; can the organization request indirect costs in the budget submission? If so, what is the limit?
- How can applicants that do not have a current federally approved indirect cost rate with a cognizant federal agency obtain an approved indirect cost rate?
- Must an organization have a Federally approved indirect cost rate to include indirect costs (F&A Costs) in the Total Costs requested in the application?
