Written by Tricia Callahan and David Schmidt
- What is UG? Uniform Guidance (UG) is guidance to the Federal agencies on the administrative requirements, cost principles, and audit requirements for Federal awards. Once the Federal agencies codify these guiding principles, they become agency regulations. Make certain you learn which rules and regulations take precedence when reviewing your Federal award terms and conditions, sponsor terms and conditions, Uniform Guidance, and state and institutional rules and regulations.
- How is UG laid out? Uniform Guidance (2 CFR 200) is divided into 6 Subparts (A-F) and 12 appendices. It is important to ensure you are in the correct section when searching the UG for answers to your questions, as some parts apply to special circumstances or entities like state/local governments, hospitals, and Indian tribes.
- What’s all this about internal controls? While mentioned specifically in 200.303, “internal controls” is mentioned over 100 times in UG. An internal control is a process implemented by a non-Federal entity (like CSU) designed to provide reasonable assurance regarding effectiveness of operations, consistency and reliability in reporting, and compliance with applicable laws and regulations. Good internal controls encourage efficiency, compliance, and help ensure we are doing what we can to eliminate waste, fraud, and abuse of taxpayer dollars.
- What does UG say about F&A? UG instructs the Federal agencies to accept our federally-negotiated indirect cost rate or notify OMB (Office of Management and Budget) why the negotiated rate is not being accepted (200.414). UG also allows for a one-time extension of an organization’s currently negotiated indirect cost rate for up to 4 years.
- What about F&A to pass-through entities? UG instructs Institutes of Higher Education (IHEs) to pay a subrecipient its federally-negotiated rate. If the sub-entity does not have, and has not had a federally negotiated rate, they can request a de minimus rate of 10%.
- What’s all the talk about risk assessment and monitoring? Pass-through entities are required to evaluate a subrecipient’s risk and determine appropriate monitoring activities based on that risk assessment (200.331). The onus is on us to ensure we have gathered sufficient information in order to understand how risks could impact Federally-funded activities and to develop controls that address identified risks.
- What’s the skinny on participant support costs? UG defines participant support costs as “direct costs for items such as stipends or subsistence allowances, travel allowances, and registration fees paid to or on behalf of participants or trainees (but not employees) in connection with conferences, or training projects.” By defining participant support costs, UG helped clarify types of costs that should not be classified as participant support, such as incentive payments, professional honoraria, and employee salaries and wages.
- Did effort reporting go away with UG? Under 200.430— Compensation – personal services– UG placed an emphasis on internal controls surrounding compensation of costs rather than focusing on specific procedures for tracking and allocating costs. Whatever methods used, institutions should review current practices and ensure they have strong internal controls and a system of record that is auditable.
- Speaking of audits, anything new on audits? With the UG came a change in threshold for the single audit requirement from $500K in annual Federal expenditures to $750K (200.501). Thresholds for simplified acquisition procedures (aka, purchasing or procurement) also changed as well. Bottom line: a minimum of two price quotations are required for purchases at or above $10,000 (threshold for IHEs changed in FY17), but under the Simplified Acquisition Threshold ($150K), with exceptions made for sole sourcing where appropriate (200.320).
- What does UG say about charging administrative salaries (200.413) and computing devices (200.453)? UG clarified the circumstances under which administrative salaries and computing devices could be charged as direct costs. In both cases, costs should be integral to the project, should be explicitly included in the budget, and should not also be recovered as indirect costs.
Blog post written by Tricia Callahan, Senior Research Education & Information Officer, and David Schmidt, Assistant Director, Office of Sponsored Programs, Colorado State University