What are Non-reimbursable Costs?

Expenses deemed non-reimbursable by the federal government either as:

• Direct costs on grants or
• Indirect costs included in F&A rates.

Listed in detail in Section J of A-21ⁱ, and include such things as:

• Advertising
• Fundraising and lobbying costs
• Entertainment

Why do we Track Non-reimbursable Costs?

• We must demonstrate to federal reviewers that the calculations leading to our proposed F&A rate do not include non-reimbursable expenditures.
• “Non-reimbursable” costs are posted primarily to non-research budgets classified in F&A categories.
• MAAⁱ removes reported non-reimbursable costs from the F&A rate proposal.

How Should Non-reimbursable Costs be Tracked?

• Refer to a description of A-21 non-reimbursable costs expenditures:
  • http://f2.washington.edu/fm/maa/fa/unallow
  • for the more comprehensive list of non-reimbursable costs, visit OMB Circular A-21 (CFR 2, Part 220)
• Review all state, gift, and RCR budgets for any unallowable activity.
• As part of monthly reconciliation process, highlight any unallowable activity.
  • PCA codes
  • MyFD reconciliation comment field
  • Existing internal reconciliation processes

Other Considerations

• What about sponsored budgets and discretionary (64-budgets):
  • Expenses on sponsored budgets are assumed allowable.
  • Expenses on 64-budgets assumed are non-reimbursable.

• Who should review and update budget classifications?
  • Departmental representatives with first hand knowledge of:
    • Nature of expenses, and
    • Clear understanding of A-21 non-reimbursable definitions
• When should transactions be reviewed?
  • Throughout FY 2013 as part of regular budget review process.
  • MAA will follow-up with departments in early fall 2013.

What Documentation is Required?

• We recommend you keep back-up:
  • For budget cost category review – notes that support your review
  • For non-reimbursable expenditures – e.g., notes in the comments field in MyFD (“NRA”)
  • Keep back-up in your departmental files
• Keep in mind that the proposal will be reviewed by the HHS negotiators months after you make these determinations.  
• What will help you remember what you did?

What Time Period Should be Used?

• The proposal is based on a full fiscal year of costs and activities (FY 2013).
• All non-reimbursable costs recorded during FY 2013 should be tracked and reported to MAA.
• FY 2013 is July 1^st, 2012 through June 30^th, 2013 (aka, the “FY 2013 F&A Base Year”)

When Should This be Completed?

• Monitor space inventory, cost categories, and non-reimbursable costs throughout the fiscal year and document as changes are needed.  
• When does MAA need the data?
  • Space inventory: December 2012 updated through June 2013
  • Budgetⁱ review: May 2013
  • Non-reimbursable costs: August 2013