Indirect Costs Federal Grants: OMB Guidance on Indirect Costs [FAST]

Now, let’s talk about indirect costs. Indirect costs are things where the costs are incurred for a common purpose, or a joint objective. Those terms generally mean it’s a support function, like your accounting department, like your HR department, like your procurement department or your purchasing department. We can’t easily tell exactly what people are working on, or it’s really not cost effective. So, let me give you an example of that. If I have an accounts payable clerk, and they’re entering invoices, I guess we could sit there with a stopwatch, or a watch, and go, okay, they just spent ten seconds entering a program invoice, and now they’ve spent fifteen seconds entering a non-program invoice, and now two more program invoices. We could do that, but why would we? There’s a concept in accounting called cost/benefit. I like to say, we shouldn’t step over dollars to pick up dimes, and that’s why things like accounting typically are thought of as a joint objective, because that accounting department is supporting multiple programs, both federally sponsored and non-federally sponsored. And Human Resources is a lot like that, as well. Human Resources, they’re helping hire people, whether they work on programs or don’t work on programs. Typically, the senior leadership of your organization is also considered as an indirect cost, because they support multiple purposes for the organization. So, those are some examples of indirect costs. Get "grant-confident" with our wide selection of MyFedTrainer.com grant training and templates #learngrants be #grantready https://myfedtrainer.com/