Georgia Department of Transportation American Recovery and Reinvestment Act Circular A-87 Synopsis

Transcription

1 A grantee/sponsor is responsible for accounting for cost appropriately and maintaining records, including supporting documentation, adequate to demonstrate that costs claimed have been incurred, are allowable, reasonable, and allocable to the project Allowable costs and costs that are reasonable and allocable to a contract or project Costs are reasonable, if its nature and amount, do not exceed what would be incurred by a prudent person in conducting a competitive business Costs are allocable if incurred specifically for the contract or project Costs are costs that are specifically identified and associated to a cost objective of a contract or project Costs are costs that are not identified with a single cost objective, but identified with two or more cost objective of a contract or project Accounting Cost to maintain accounting records and documents Advertising and public relations Advertising is the cost to exhibit in advertising media, such as newspapers, magazines, trade papers, radio, television, exhibits and conventions Public relations cost is the expense maintain the image of a company or entity Salary expense for employees in accounting department Expense to purchase an accounting system Advertising cost associated with Recruitment of personnel Procurement of goods & services Disposal of surplus material Public relation cost associated with Communications required by the award as a direct cost Communications necessary on matters of public concern Expenses paid to prepare tax returns Advertising and public relations cost associated with Promotional items, memorabilia, souvenirs & mementos Displays, demonstrations & exhibits Sponsorship of conventions, meetings, meeting rooms, hospitality suites, & special facilities Salaries of employees engaged in setting up or providing the above Page 1 of 12

2 Advisory councils Group who gives advise As a direct cost if authorized by the granting agency As a indirect cost if allocable to the award If not authorized or allocable by the awarding agency N/A Alcoholic beverages Audit services Liquor, beer & wine N/A Expressly not allowed Services related to an examination of the accounting records and documents Cost incurred in performing an audit under the Single Audit Act (Circular A-128) Cost incurred if specifically approved by the awarding agency Cost incurred for audits not performed in accordance with the Single Audit Act (Circular A- 128) Automatic data processing N/A Bad debts Losses from uncollectible accounts and claims Bonding costs Insurance policy to protect against financial loss Types of bonding include bid, performance, payment and fidelity Processing data by a computer Cost of data processing services Equipment cost (See section on equipment cost for proper treatment) N/A Expressly not allowed unless provided for in program award regulations If done in accordance with sound business practices and rates are reasonable under the circumstances If required by the terms of the contract Not allowed, except as noted in the allowable cost column Budgeting A plan specifying how resource are allocated Page 2 of 12 Salaries for employees in the budget department Salaries for employees in internal audit department

3 and Communications System for sending and receiving messages and information Compensation for personal services (Labor) Payment for personal services (Labor - Salaries and wages) Cost related to use of telephone, fax machine, mail, messenger and internet Salaries, wages and fringe benefits Sick leave Holiday pay Pension cost Severance pay Backpay Deferred compensation Post retirement benefits other than pensions Employee rebate & purchase discount plans Bonuses and incentive compensation Executive compensation in excess of the benchmark compensation amount determined by the Office of Federal Procurement Policy For owners of closely held corporation compensation cannot be a distribution of profit N/A Contingencies A possible but unlikely or unplanned event N/A Expressly not allowed N/A Contributions and donations A gift N/A Expressly not allowed Defense and persecution of criminal and civil proceeding and claims Legal expenses related to defending or pursuing civil or criminal claims Legal expenses to administer a Federal program Legal expenses to review contracts Legal expenses to prosecute claims against the Federal Government Legal expense incurred by a contractor to defense against a Page 3 of 12

4 Depreciation and use allowance A method of allocating the cost of fixed assets to the period benefitting from the asset use Depreciation or use allowance may be calculated on the following Depreciation of building, equipment or building and its components based on the useful life of the assets A negotiated use allowance for any assets that are fully depreciated claim commenced by the Federal Government Legal cost incurred by a contract to defend against a criminal or civil fraud claim where the contractor is found liable or pleaded nolo contendere Legal cost to sue the Federal government Depreciation is not allowed on the following Cost of land Cost of building and equipment borne or donated by the federal government Cost of building or equipment contributed by or for a governmental unit to satisfy a matching requirement Disbursing service Cost of dispensing funds to recipients by a designated officer Cost of staff to process payments (?) Employee morale, health and welfare costs Cost incurred on activities to improve employees wellbeing, working conditions, performance and employer-employee relations Cost for health or first-aid clinics, infirmaries, on-site recreational facilities, counseling services and employee information publications Cost of gift are not allowed Cost for recreation, not affiliated with a company sponsored sports team Page 4 of 12

5 Cost for awards for employee performance and achievement Cost for participation in company sponsored sports teams N/A Entertainment Costs related to amusement, diversion and social activities such as, tickets to sports events, shows, meals, lodging rental or transportation -Cost of membership in social or country clubs N/A Expressly not allowed and N/A Page 5 of 12 Equipment and other capital expenditures Fines and penalties Equipment is any article of tangible personal property with a useful life of more than one year. Capital assets are buildings, land and improvement that increase their value or useful life. Costs of capital expenditures include the invoice price as well as cost of modifications, attachments and accessories to make it usable. Fines penalties, damages or settlements resulting from violations of federal, state, Costs related to the purchase of buildings, land and improvement that increase their value or useful life Costs related to the purchase of equipment and/or replacement equipment Only if incurred as a result of compliance with specific provision of the federal Items of equipment costing less than $5000 are considered supplies and should be treated as direct cost in the supply category Not allowed, except as noted in the allowable cost column

6 local or Indian tribal laws and regulations award or advance written authorization of payments by the awarding agency N/A Fund raising and investment management costs Solicitation of gifts and bequests; Expenses to enhance income from investments Only cost associated with investments covering pension or self-insurance Not allowed, except as noted in the allowable cost column Gains and losses on disposition of depreciable property and other capital asset and substantial relocation of Federal programs General government expense Gains or losses arising from the sale or exchange of property Cost of operating the government Allowable loss is limited to the difference between the fair market value and the undepreciated balance of the asset The gain recognized is limited to the difference between the acquisition cost and the undepreciated balance The portion of salaries and expenses directly attributable to managing and operating Federal programs by the chief executive and staff of a tribal government and Council of Governments (COGS). Salaries and expenses of the Office of the Governor of a State or the chief executive of a political subdivision or a Indian tribal government Salaries and expenses of State legislature, tribal councils, or local governmental bodies Cost of the judiciary branch of a government Page 6 of 12

7 Page 7 of 12 Georgia Department of Transportation Idle facility and idle capacity Insurance and indemnification Unused facility that exceed the governmental unit s current needs Protection against damages, losses or injury Interest Cost incurred on borrowed capital Cost for facilities that were necessary when acquired but became idle as a result of changes in program requirements Idle capacity costs that are a normal cost of doing business Coverage required or approved under the terms of the contract Coverage maintained by the contractor under the general conduct of business Financing cost associated with the allowable cost of building acquisition, construction, reconstruction or remodeling Financing cost associated with the allowable cost of equipment Provided the following occurs o financing is provided by a bona Cost of prosecutorial activities Other types of governmental services normally provided to the public, such as fire and police Not allowed, except as noted in the allowable cost column Premiums for self insurance or insurance with captive insurers are limited to the amount available from competitive market forces Not allowed, except as noted in the allowable cost column

8 Page 8 of 12 Georgia Department of Transportation N/A Lobbying Costs to influence activities associated with obtaining grants, contracts or loans Cost to influence Federal, State or local election, legislation or modification of legislation and Maintenance, operations and repairs Material and supplies Cost of utilities, insurance, security janitorial services, elevator service, upkeep of grounds and normal repairs Cost of purchases after deducting for cash discount, trade discounts, rebates and allowances and adjusting for transportation and insurance. fide third party o assets are used in support of Federal awards o earning on debt service reserve funds or on borrowed funding pending payment are used to offset current period s interest cost N/A Expressly not allowed Cost that keep the property in an efficient operating condition and do not add permanent value Cost of the item and adjustments for discounts and transportation cost Reasonable adjustments to inventory items based on differences between physical inventory and book value Costs which add to the value of the property appreciably or prolong its intended life (Cost of this nature must be treated as capital expenditures) Cost in excess of generally accepted pricing methods

9 Actual cost of item purchased specifically for the contract Memberships, subscriptions and professional activities Belonging to a group Costs of memberships in business, technical and professional organizations Costs of subscriptions to business, professional and technical periodicals Cost of meetings where the primary purpose is to disseminate technical information Costs of memberships in civil, community and social organization with approval of Federal awarding agency Cost of membership in organizations engaged in lobbying Motor pools A centrally managed group of motor vehicles for use of an agency s personnel Pre-award costs Costs incurred prior to the effective date of an award where the cost are necessary to comply with the delivery schedule or period of performance Cost of using an automobile at mileage or fixed rates Costs allowed only to the extent that it is allowable if incurred after the date of the award and only with written approval of the awarding agency Not allowed, except as noted in the allowable cost column Page 9 of 12

10 Professional service costs Cost for services rendered by persons or organizations of a particular profession or who possess a special skill Cost that are reasonable in relation to services rendered and not contingent upon recovery of cost from the Federal Government Retainer fees supported by bona fide services available or rendered Contingent fees are not allowed See section on defense and persecution of criminal for other unallowable professional fees and Proposal costs Cost for preparing proposals Proposal cost are allowable and are normally treated as indirect cost as part of the cost allocation plan and indirect cost rate Cost may be charged directly to Federal awards with prior approval of the federal awarding agency Contingent fees are not allowed and Publication and printing cost Cost for printing, press work, binding, distribution and general handling Printing Promotion cost Processes of composition Rearrangements and alterations Restoring the facilities to approximately the same conditions existing immediately before the start of the contract Ordinary and normal rearrangement and alteration of the facility Special arrangement and alteration cost incurred specifically for a Federal award are allowed with Improvements of the facilities related to normal wear and tear Page 10 of 12

11 prior approval of the awarding agency Reconversion costs Cost to restore or rehabilitate a facility to the same condition existing prior to the Federal award Cost to reverse any changes made to modify a facility to comply with Federal award conditions or terms Cost related to normal wear and tear are not allowed Rental costs Cost paid for the right to use a facility or equipment Rental costs that are reasonable in light of rental costs of comparable property, market conditions in the area and condition and value of the facility, equipment or property Amount are limited based on type of leases and who owns the facility or property Taxes A fee required of individuals, groups and businesses for the support of the government Training To give specialized instruction or practice Federal, state and local taxes Cost of training and education for employee development related to the field in which the employee is working or is expected to work Federal income taxes and excess profit taxes Overtime compensation for training Training or education costs for other than bona fide employees Cost of education or training for graduate level education that exceeds the normal length of the degree program Page 11 of 12

12 and Travel Expenses for transportation, lodging, subsistence and other related items for employees on business travel Cost for lodging and subsistence that is reasonable and allowable(see for domestic per diem rates) Commercial airfare cost that is customary standard (coach or equivalent) Reasonable accommodations adequate to the medical needs of the traveler Mileage (See privately operated vehicle (POV) link on for current rates) First-class airfare Air travel by non-commercial carrier that exceeds the cost of available commercial standard air travel cost Cost of company furnished automobiles that relates to personal use by employees N/A Under recovery of costs under Federal agreements To apply the excess cost over the Federal contribution amount from one award agreement to other award agreements which are under the Federal award amount N/A Expressly not allowed Page 12 of 12