Faculty & Staff

OMB Circular A-21, Cost Principles for Educational Institutions, issued by the USG’s Office of Management and Budget, contains specific language which precludes or limits charging certain expenses to USG grants and contracts. These expenses include specifically:

• unallowable costs,
• clerical and administrative salaries, and
• office supplies.

Unallowable Costs

Unallowable costs are costs incurred by the University that do not meet the criteria for allowable costs, which are:

• The cost is reasonable for the performance of the award, and
• The cost is in conformance with any limitations or exclusions set forth in the USG cost principles applicable to the recipient’s organization or in the Notice of Award, and
• The cost is consistent with University policies and procedures

Unallowable costs include alcoholic beverages, entertainment, and membership in non-professional organizations. See Lodging, Meals and Incidentals for unallowable travel expenses.

In order to ensure that the University does not inadvertently include any unallowable expenses in its direct or indirect charges to grants and contracts, unallowable expenses have been assigned a special series of sub-codes. For the list of sub-codes and full text of the policy, see the University’s policy on Subcodes for Segregation of "Unallowable" Expenses.

Clerical and Administrative Salaries

Clerical and administrative salaries generally may not be charged directly to USG-sourced grants and contracts. There are important exceptions to this rule, usually when:

• The salaries have been explicitly budgeted on the USG project, and
• The individuals involved can be specifically identified with the project or activity

Accordingly, it is vital that PIs fully justify in grant and contract applications those situations where administrative and clerical support is necessary to the project, whether because the nature of the work performed under a particular project requires an extensive amount of administrative or clerical support, or the tasks to be performed under a particular project relate specifically to the technical substance of the project.

For details about the requirements, as well as examples of situations where it is appropriate to directly charge these salaries, see the policy on Charging Administrative and Clerical Salaries to Federal Grants and Contracts.

Office Supplies

Office expenses, such as postage, office supplies, and local telephone calls, generally may not be directly charged to USG-sourced grants and contracts, because they should normally be treated as indirect costs.

There are important exceptions to this rule, as explained in the University’s policy on Charging Office Supplies and Other Administrative Expenses (Other Than Salaries) to Federal Awards.