CFR-2014-title2-vol1-part200.pdf

PART 200—UNIFORM ADMINISTRA-

TIVE REQUIREMENTS, COST PRIN-

CIPLES, AND AUDIT REQUIRE-

MENTS FOR FEDERAL AWARDS

Subpart A—Acronyms and Definitions

ACRONYMS

Sec.

200.0 Acronyms.

200.1 Definitions.

200.2 Acquisition cost.

200.3 Advance payment.

200.4 Allocation.

200.5 Audit finding.

200.6 Auditee.

200.7 Auditor.

200.8 Budget.

200.9 Central service cost allocation plan.

200.10 Catalog of Federal Domestic Assist-

ance (CFDA) number.

200.11 CFDA program title.

200.12 Capital assets.

200.13 Capital expenditures.

200.14 Claim.

200.15 Class of Federal awards.

200.16 Closeout.

200.17 Cluster of programs.

200.18 Cognizant agency for audit.

200.19 Cognizant agency for indirect costs.

200.20 Computing devices.

200.21 Compliance supplement.

200.22 Contract.

200.23 Contractor.

200.24 Cooperative agreement.

200.25 Cooperative audit resolution.

200.26 Corrective action.

200.27 Cost allocation plan.

200.28 Cost objective.

200.29 Cost sharing or matching.

200.30 Cross-cutting audit finding.

200.31 Disallowed costs.

200.32 Data Universal Numbering System

(DUNS) number.

200.33 Equipment.

200.34 Expenditures.

200.35 Federal agency.

200.36 Federal Audit Clearinghouse (FAC).

200.37 Federal awarding agency.

200.38 Federal award.

200.39 Federal award date.

200.40 Federal financial assistance.

200.41 Federal interest.

200.42 Federal program.

200.43 Federal share.

200.44 Final cost objective.

200.45 Fixed amount awards.

200.46 Foreign public entity.

200.47 Foreign organization.

200.48 General purpose equipment.

200.49 Generally Accepted Accounting Prin-

ciples (GAAP).

200.50 Generally Accepted Government Au-

diting Standards (GAGAS).

200.51 Grant agreement.

200.52 Hospital.

200.53 Improper payment.

200.54 Indian tribe (or ‘‘federally recognized

Indian tribe’’).

200.55 Institutions of Higher Education

(IHEs).

200.56 Indirect (facilities & administrative

(F&A)) costs.

200.57 Indirect cost rate proposal.

200.58 Information technology systems.

200.59 Intangible property.

200.60 Intermediate cost objective.

200.61 Internal controls.

200.62 Internal control over compliance re-

quirements for Federal awards.

200.63 Loan.

200.64 Local government.

200.65 Major program.

200.66 Management decision.

200.67 Micro-purchase.

200.68 Modified Total Direct Cost (MTDC).

200.69 Non-Federal entity.

200.70 Nonprofit organization.

200.71 Obligations.

200.72 Office of Management and Budget

(OMB).

200.73 Oversight agency for audit.

200.74 Pass-through entity.

200.75 Participant support costs.

200.76 Performance goal.

200.77 Period of performance.

200.78 Personal property.

200.79 Personally Identifiable Information

(PII).

200.80 Program income.

200.81 Property.

200.82 Protected Personally Identifiable In-

formation (Protected PII).

200.83 Project cost.

200.84 Questioned cost.

200.85 Real property.

200.86 Recipient.

200.87 Research and Development (R&D).

200.88 Simplified acquisition threshold.

200.89 Special purpose equipment.

200.90 State.

200.91 Student Financial Aid (SFA).

200.92 Subaward.

200.93 Subrecipient.

200.94 Supplies.

200.95 Termination.

200.96 Third-party in-kind contributions.

200.97 Unliquidated obligations.

200.98 Unobligated balance.

200.99 Voluntary committed cost sharing.

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2 CFR Ch. II (1–1–14 Edition) Pt. 200

Subpart B—General Provisions

200.100 Purpose.

200.101 Applicability.

200.102 Exceptions.

200.103 Authorities.

200.104 Supersession.

200.105 Effect on other issuances.

200.106 Agency implementation.

200.107 OMB responsibilities.

200.108 Inquiries.

200.109 Review date.

200.110 Effective/applicability date.

200.111 English language.

200.112 Conflict of interest.

200.113 Mandatory disclosures.

Subpart C—Pre-Federal Award Require-ments and Contents of Federal Awards

200.200 Purpose.

200.201 Use of grant agreements (including

fixed amount awards), cooperative agree-ments, and contracts.

200.202 Requirement to provide public no-

tice of Federal financial assistance pro-grams.

200.203 Notices of funding opportunities.

200.204 Federal awarding agency review of

merit of proposals.

200.205 Federal awarding agency review of

risk posed by applicants.

200.206 Standard application requirements.

200.207 Specific conditions.

200.208 Certifications and representations.

200.209 Pre-award costs.

200.210 Information contained in a Federal

award.

200.211 Public access to Federal award infor-

mation.

Subpart D—Post Federal Award Requirements

STANDARDS FOR FINANCIAL AND PROGRAM

MANAGEMENT

200.300 Statutory and national policy re-

quirements.

200.301 Performance measurement.

200.302 Financial management.

200.303 Internal controls.

200.304 Bonds.

200.305 Payment.

200.306 Cost sharing or matching.

200.307 Program income.

200.308 Revision of budget and program

plans.

200.309 Period of performance.

PROPERTY STANDARDS

200.310 Insurance coverage.

200.311 Real property.

200.312 Federally-owned and exempt prop-

erty.

200.313 Equipment.

200.314 Supplies.

200.315 Intangible property.

200.316 Property trust relationship.

PROCUREMENT STANDARDS

200.317 Procurements by states.

200.318 General procurement standards.

200.319 Competition.

200.320 Methods of procurement to be fol-

lowed.

200.321 Contracting with small and minority

businesses, women’s business enterprises, and labor surplus area firms.

200.322 Procurement of recovered materials.

200.323 Contract cost and price.

200.324 Federal awarding agency or pass-

through entity review.

200.325 Bonding requirements.

200.326 Contract provisions.

PERFORMANCE AND FINANCIAL MONITORING

AND REPORTING

200.327 Financial reporting.

200.328 Monitoring and reporting program

performance.

200.329 Reporting on real property.

SUBRECIPIENT MONITORING AND MANAGEMENT

200.330 Subrecipient and contractor deter-

minations.

200.331 Requirements for pass-through enti-

ties.

200.332 Fixed amount subawards.

RECORD RETENTION AND ACCESS

200.333 Retention requirements for records.

200.334 Requests for transfer of records.

200.335 Methods for collection, transmission

and storage of information.

200.336 Access to records.

200.337 Restrictions on public access to

records.

REMEDIES FOR NONCOMPLIANCE

200.338 Remedies for noncompliance.

200.339 Termination.

200.340 Notification of termination require-

ment.

200.341 Opportunities to object, hearings

and appeals.

200.342 Effects of suspension and termi-

nation.

CLOSEOUT

200.343 Closeout.

POST-CLOSEOUT ADJUSTMENTS AND

CONTINUING RESPONSIBILITIES

200.344 Post-closeout adjustments and con-

tinuing responsibilities.

COLLECTION OF AMOUNTS DUE

200.345 Collection of amounts due.

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OMB Guidance Pt. 200

Subpart E—Cost Principles

GENERAL PROVISIONS

200.400 Policy guide.

200.401 Application.

BASIC CONSIDERATIONS

200.402 Composition of costs.

200.403 Factors affecting allowability of

costs.

200.404 Reasonable costs.

200.405 Allocable costs.

200.406 Applicable credits.

200.407 Prior written approval (prior ap-

proval).

200.408 Limitation on allowance of costs.

200.409 Special considerations.

200.410 Collection of unallowable costs.

200.411 Adjustment of previously negotiated

indirect (F&A) cost rates containing un-allowable costs.

DIRECT AND INDIRECT (F&A) COSTS

200.412 Classification of costs.

200.413 Direct costs.

200.414 Indirect (F&A) costs.

200.415 Required certifications.

SPECIAL CONSIDERATIONS FOR STATES, LOCAL

GOVERNMENTS AND INDIAN TRIBES

200.416 Cost allocation plans and indirect

cost proposals.

200.417 Interagency service.

SPECIAL CONSIDERATIONS FOR INSTITUTIONS OF

HIGHER EDUCATION

200.418 Costs incurred by states and local

governments.

200.419 Cost accounting standards and dis-

closure statement.

GENERAL PROVISIONS FOR SELECTED ITEMS OF

COST

200.420 Considerations for selected items of

cost.

200.421 Advertising and public relations.

200.422 Advisory councils.

200.423 Alcoholic beverages.

200.424 Alumni/ae activities.

200.425 Audit services.

200.426 Bad debts.

200.427 Bonding costs.

200.428 Collections of improper payments.

200.429 Commencement and convocation

costs.

200.430 Compensation—personal services.

200.431 Compensation—fringe benefits.

200.432 Conferences.

200.433 Contingency provisions.

200.434 Contributions and donations.

200.435 Defense and prosecution of criminal

and civil proceedings, claims, appeals and patent infringements.

200.436 Depreciation.

200.437 Employee health and welfare costs.

200.438 Entertainment costs.

200.439 Equipment and other capital expend-

itures.

200.440 Exchange rates.

200.441 Fines, penalties, damages and other

settlements.

200.442 Fund raising and investment man-

agement costs.

200.443 Gains and losses on disposition of de-

preciable assets.

200.444 General costs of government.

200.445 Goods or services for personal use.

200.446 Idle facilities and idle capacity.

200.447 Insurance and indemnification.

200.448 Intellectual property.

200.449 Interest.

200.450 Lobbying.

200.451 Losses on other awards or contracts.

200.452 Maintenance and repair costs.

200.453 Materials and supplies costs, includ-

ing costs of computing devices.

200.454 Memberships, subscriptions, and pro-

fessional activity costs.

200.455 Organization costs.

200.456 Participant support costs.

200.457 Plant and security costs.

200.458 Pre-award costs.

200.459 Professional service costs.

200.460 Proposal costs.

200.461 Publication and printing costs.

200.462 Rearrangement and reconversion

costs.

200.463 Recruiting costs.

200.464 Relocation costs of employees.

200.465 Rental costs of real property and

equipment.

200.466 Scholarships and student aid costs.

200.467 Selling and marketing costs.

200.468 Specialized service facilities.

200.469 Student activity costs.

200.470 Taxes (including Value Added Tax).

200.471 Termination costs.

200.472 Training and education costs.

200.473 Transportation costs.

200.474 Travel costs.

200.475 Trustees.

Subpart F—Audit Requirements

GENERAL

200.500 Purpose.

AUDITS

200.501 Audit requirements.

200.502 Basis for determining Federal

awards expended.

200.503 Relation to other audit require-

ments.

200.504 Frequency of audits.

200.505 Sanctions.

200.506 Audit costs.

200.507 Program-specific audits.

AUDITEES

200.508 Auditee responsibilities.

200.509 Auditor selection.

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2 CFR Ch. II (1–1–14 Edition) § 200.0

200.510 Financial statements.

200.511 Audit findings follow-up.

200.512 Report submission.

FEDERAL AGENCIES

200.513 Responsibilities.

AUDITORS

200.514 Scope of audit.

200.515 Audit reporting.

200.516 Audit findings.

200.517 Audit documentation.

200.518 Major program determination.

200.519 Criteria for Federal program risk.

200.520 Criteria for a low-risk auditee.

MANAGEMENT DECISIONS

200.521 Management decision.

APPENDIX I TO PART 200—FULL TEXT OF NO-

TICE OF FUNDING OPPORTUNITY

APPENDIX II TO PART 200—CONTRACT PROVI-

SIONS FOR NON-FEDERAL ENTITY CON-

TRACTS UNDER FEDERAL AWARDS

APPENDIX III TO PART 200—INDIRECT (F&A)

COSTS IDENTIFICATION AND ASSIGNMENT,

AND RATE DETERMINATION FOR INSTITU-

TIONS OF HIGHER EDUCATION (IHES)

APPENDIX IV TO PART 200—INDIRECT (F&A)

COSTS IDENTIFICATION AND ASSIGNMENT,

AND RATE DETERMINATION FOR NONPROFIT

ORGANIZATIONS

APPENDIX V TO PART 200—STATE/LOCAL GOV-

ERNMENT AND INDIAN TRIBE-WIDE CEN-

TRAL SERVICE COST ALLOCATION PLANS

APPENDIX VI TO PART 200—PUBLIC ASSIST-

ANCE COST ALLOCATION PLANS

APPENDIX VII TO PART 220—STATES AND

LOCAL GOVERNMENT AND INDIAN TRIBE IN-

DIRECT COST PROPOSALS

APPENDIX VIII TO PART 200—NONPROFIT OR-

GANIZATIONS EXEMPTED FROM SUBPART

E—COST PRINCIPLES OF PART 200

APPENDIX IX TO PART 200—HOSPITAL COST

PRINCIPLES

APPENDIX X TO PART 200—DATA COLLECTION

FORM (FORM SF–SAC)

APPENDIX XI TO PART 200—COMPLIANCE SUP-

PLEMENT

AUTHORITY: 31 U.S.C. 503

SOURCE: 78 FR 78608, Dec. 26, 2013, unless otherwise noted.

Subpart A—Acronyms and Definitions

ACRONYMS

§ 200.0 Acronyms.

ACRONYM TERM

CAS Cost Accounting Standards CFDA Catalog of Federal Domestic

Assistance

CFR Code of Federal Regulations CMIA Cash Management Improve-ment Act COG Councils Of Governments COSO Committee of Sponsoring Orga-nizations of the Treadway Commis-sion

D&B Dun and Bradstreet DUNS Data Universal Numbering

System EPA Environmental Protection Agen-cy ERISA Employee Retirement Income

Security Act of 1974 (29 U.S.C. 1301– 1461)

EUI Energy Usage Index F&A Facilities and Administration FAC Federal Audit Clearinghouse FAIN Federal Award Identification

Number FAPIIS Federal Awardee Perform-ance and Integrity Information Sys-tem

FAR Federal Acquisition Regulation FFATA Federal Funding Account-ability and Transparency Act of 2006 or Transparency Act—Public Law 109–282, as amended by section 6202(a) of Public Law 110–252 (31 U.S.C. 6101)

FICA Federal Insurance Contribu-tions Act

FOIA Freedom of Information Act FR Federal Register FTE Full-time equivalent GAAP Generally Accepted Account-ing Principles GAGAS Generally Accepted Govern-ment Accounting Standards GAO General Accounting Office GOCO Government owned, contractor operated GSA General Services Administration IBS Institutional Base Salary IHE Institutions of Higher Education IRC Internal Revenue Code ISDEAA Indian Self-Determination and Education and Assistance Act MTC Modified Total Cost MTDC Modified Total Direct Cost OMB Office of Management and Budg-et PII Personally Identifiable Informa-tion PRHP Post-retirement Health Plans PTE Pass-through Entity REUI Relative Energy Usage Index SAM System for Award Management SFA Student Financial Aid SNAP Supplemental Nutrition Assist-ance Program

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OMB Guidance § 200.10

SPOC Single Point of Contact TANF Temporary Assistance for

Needy Families TFM Treasury Financial Manual U.S.C. United States Code VAT Value Added Tax

§ 200.1 Definitions.

These are the definitions for terms used in this part. Different definitions may be found in Federal statutes or regulations that apply more specifi-cally to particular programs or activi-ties. These definitions could be supple-mented by additional instructional in-formation provided in governmentwide standard information collections.

§ 200.2 Acquisition cost.

Acquisition cost means the cost of the asset including the cost to ready the asset for its intended use. Acquisition cost for equipment, for example, means the net invoice price of the equipment, including the cost of any modifica-tions, attachments, accessories, or aux-iliary apparatus necessary to make it usable for the purpose for which it is acquired. Acquisition costs for soft-ware includes those development costs capitalized in accordance with gen-erally accepted accounting principles (GAAP). Ancillary charges, such as taxes, duty, protective in transit insur-ance, freight, and installation may be included in or excluded from the acqui-sition cost in accordance with the non- Federal entity’s regular accounting practices.

§200.3 Advance payment.

Advance payment means a payment that a Federal awarding agency or pass-through entity makes by any ap-propriate payment mechanism, includ-ing a predetermined payment schedule, before the non-Federal entity disburses the funds for program purposes.

§ 200.4 Allocation.

Allocation means the process of as-signing a cost, or a group of costs, to one or more cost objective(s), in rea-sonable proportion to the benefit pro-vided or other equitable relationship.

The process may entail assigning a cost(s) directly to a final cost objective or through one or more intermediate cost objectives.

§ 200.5 Audit finding.

Audit finding means deficiencies which the auditor is required by § 200.516 Audit findings, paragraph (a) to report in the schedule of findings and questioned costs.

§ 200.6 Auditee.

Auditee means any non-Federal enti-ty that expends Federal awards which must be audited under Subpart F— Audit Requirements of this part.

§ 200.7 Auditor.

Auditor means an auditor who is a public accountant or a Federal, state or local government audit organiza-tion, which meets the general stand-ards specified in generally accepted government auditing standards (GAGAS). The term auditor does not include internal auditors of nonprofit organizations.

§ 200.8 Budget.

Budget means the financial plan for the project or program that the Fed-eral awarding agency or pass-through entity approves during the Federal award process or in subsequent amend-ments to the Federal award. It may in-clude the Federal and non-Federal share or only the Federal share, as de-termined by the Federal awarding agency or pass-through entity.

§ 200.9 Central service cost allocation plan.

Central service cost allocation plan means the documentation identifying, accumulating, and allocating or devel-oping billing rates based on the allow-able costs of services provided by a state, local government, or Indian tribe on a centralized basis to its depart-ments and agencies. The costs of these services may be allocated or billed to users.

§ 200.10 Catalog of Federal Domestic Assistance (CFDA) number.

CFDA number means the number as-signed to a Federal program in the

CFDA.

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2 CFR Ch. II (1–1–14 Edition) § 200.11

§ 200.11 CFDA program title.

CFDA program title means the title of the program under which the Federal award was funded in the CFDA.

§ 200.12 Capital assets.

Capital assets means tangible or in-tangible assets used in operations hav-ing a useful life of more than one year which are capitalized in accordance with GAAP. Capital assets include:

(a) Land, buildings (facilities), equip-ment, and intellectual property (in-cluding software) whether acquired by purchase, construction, manufacture, lease-purchase, exchange, or through capital leases; and

(b) Additions, improvements, modi-fications, replacements, rearrange-ments, reinstallations, renovations or alterations to capital assets that mate-rially increase their value or useful life (not ordinary repairs and mainte-nance).

§ 200.13 Capital expenditures.

Capital expenditures means expendi-tures to acquire capital assets or ex-penditures to make additions, improve-ments, modifications, replacements, rearrangements, reinstallations, ren-ovations, or alterations to capital as-sets that materially increase their value or useful life.

§ 200.14 Claim.

Claim means, depending on the con-text, either:

(a) A written demand or written as-sertion by one of the parties to a Fed-eral award seeking as a matter of right:

(1) The payment of money in a sum certain;

(2) The adjustment or interpretation of the terms and conditions of the Fed-eral award; or

(3) Other relief arising under or relat-ing to a Federal award.

(b) A request for payment that is not in dispute when submitted.

§ 200.15 Class of Federal awards.

Class of Federal awards means a group of Federal awards either awarded under a specific program or group of pro-grams or to a specific type of non-Fed-eral entity or group of non-Federal en-tities to which specific provisions or exceptions may apply.

§ 200.16 Closeout.

Closeout means the process by which the Federal awarding agency or pass-through entity determines that all ap-plicable administrative actions and all required work of the Federal award have been completed and takes actions as described in § 200.343 Closeout.

§ 200.17 Cluster of programs.

Cluster of programs means a grouping of closely related programs that share common compliance requirements. The types of clusters of programs are re-search and development (R&D), student financial aid (SFA), and other clusters.

‘‘Other clusters’’ are as defined by OMB in the compliance supplement or as designated by a state for Federal awards the state provides to its sub-recipients that meet the definition of a cluster of programs. When designating an ‘‘other cluster,’’ a state must iden-tify the Federal awards included in the cluster and advise the subrecipients of compliance requirements applicable to the cluster, consistent with § 200.331 Requirements for pass-through enti-ties, paragraph (a). A cluster of pro-grams must be considered as one pro-gram for determining major programs, as described in § 200.518 Major program determination, and, with the exception of R&D as described in § 200.501 Audit requirements, paragraph (c), whether a program-specific audit may be elected.

§ 200.18 Cognizant agency for audit.

Cognizant agency for audit means the

Federal agency designated to carry out the responsibilities described in § 200.513 Responsibilities, paragraph (a).

The cognizant agency for audit is not necessarily the same as the cognizant agency for indirect costs. A list of cog-nizant agencies for audit may be found at the FAC Web site.

§ 200.19 Cognizant agency for indirect costs.

Cognizant agency for indirect costs means the Federal agency responsible for reviewing, negotiating, and approv-ing cost allocation plans or indirect cost proposals developed under this part on behalf of all Federal agencies.

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OMB Guidance § 200.25

The cognizant agency for indirect cost is not necessarily the same as the cog-nizant agency for audit. For assign-ments of cognizant agencies see the following:

(a) For IHEs: Appendix III to Part 200—Indirect (F&A) Costs Identifica-tion and Assignment, and Rate Deter-mination for Institutions of Higher Education (IHEs), paragraph C.10.

(b) For nonprofit organizations: Ap-pendix IV to Part 200—Indirect (F&A) Costs Identification and Assignment, and Rate Determination for Nonprofit Organizations, paragraph C.1.

(c) For state and local governments:

Appendix V to Part 200—State/Local Government and Indian Tribe-Wide Central Service Cost Allocation Plans, paragraph F.1.

§ 200.20 Computing devices.

Computing devices means machines used to acquire, store, analyze, process, and publish data and other information electronically, including accessories (or ‘‘peripherals’’) for printing, trans-mitting and receiving, or storing elec-tronic information. See also §§ 200.94 Supplies and 200.58 Information tech-nology systems.

§ 200.21 Compliance supplement.

Compliance supplement means Appen-dix XI to Part 200—Compliance Supple-ment (previously known as the Cir-cular A–133 Compliance Supplement).

§ 200.22 Contract.

Contract means a legal instrument by which a non-Federal entity purchases property or services needed to carry out the project or program under a Federal award. The term as used in this part does not include a legal in-strument, even if the non-Federal enti-ty considers it a contract, when the substance of the transaction meets the definition of a Federal award or subaward (see § 200.92 Subaward).

§ 200.23 Contractor.

Contractor means an entity that re-ceives a contract as defined in § 200.22 Contract.

§ 200.24 Cooperative agreement.

Cooperative agreement means a legal instrument of financial assistance be-tween a Federal awarding agency or pass-through entity and a non-Federal entity that, consistent with 31 U.S.C.

6302–6305:

(a) Is used to enter into a relation-ship the principal purpose of which is to transfer anything of value from the Federal awarding agency or pass-through entity to the non-Federal enti-ty to carry out a public purpose au-thorized by a law of the United States (see 31 U.S.C. 6101(3)); and not to ac-quire property or services for the Fed-eral government or pass-through enti-ty’s direct benefit or use;

(b) Is distinguished from a grant in that it provides for substantial involve-ment between the Federal awarding agency or pass-through entity and the non-Federal entity in carrying out the activity contemplated by the Federal award.

(c) The term does not include:

(1) A cooperative research and devel-opment agreement as defined in 15 U.S.C. 3710a; or

(2) An agreement that provides only:

(i) Direct United States Government cash assistance to an individual;

(ii) A subsidy;

(iii) A loan;

(iv) A loan guarantee; or

(v) Insurance.

§ 200.25 Cooperative audit resolution.

Cooperative audit resolution means the use of audit follow-up techniques which promote prompt corrective action by improving communication, fostering collaboration, promoting trust, and de-veloping an understanding between the Federal agency and the non-Federal en-tity. This approach is based upon:

(a) A strong commitment by Federal agency and non-Federal entity leader-ship to program integrity;

(b) Federal agencies strengthening partnerships and working coopera-tively with non-Federal entities and their auditors; and non-Federal enti-ties and their auditors working coop-eratively with Federal agencies;

(c) A focus on current conditions and corrective action going forward;

(d) Federal agencies offering appro-priate relief for past noncompliance when audits show prompt corrective action has occurred; and

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2 CFR Ch. II (1–1–14 Edition) § 200.26

(e) Federal agency leadership sending a clear message that continued failure to correct conditions identified by au-dits which are likely to cause improper payments, fraud, waste, or abuse is un-acceptable and will result in sanctions.

§ 200.26 Corrective action.

Corrective action means action taken by the auditee that:

(a) Corrects identified deficiencies;

(b) Produces recommended improve-ments; or

(c) Demonstrates that audit findings are either invalid or do not warrant auditee action.

§ 200.27 Cost allocation plan.

Cost allocation plan means central service cost allocation plan or public assistance cost allocation plan.

§ 200.28 Cost objective.

Cost objective means a program, func-tion, activity, award, organizational subdivision, contract, or work unit for which cost data are desired and for which provision is made to accumulate and measure the cost of processes, products, jobs, capital projects, etc. A cost objective may be a major function of the non-Federal entity, a particular service or project, a Federal award, or an indirect (Facilities & Administra-tive (F&A)) cost activity, as described in Subpart E—Cost Principles of this Part. See also §§ 200.44 Final cost objec-tive and 200.60 Intermediate cost objec-tive.

§ 200.29 Cost sharing or matching.

Cost sharing or matching means the portion of project costs not paid by Federal funds (unless otherwise author-ized by Federal statute). See also § 200.306 Cost sharing or matching.

§ 200.30 Cross-cutting audit finding.

Cross-cutting audit finding means an audit finding where the same under-lying condition or issue affects Federal awards of more than one Federal awarding agency or pass-through enti-ty.

§ 200.31 Disallowed costs.

Disallowed costs means those charges to a Federal award that the Federal awarding agency or pass-through enti-ty determines to be unallowable, in ac-cordance with the applicable Federal statutes, regulations, or the terms and conditions of the Federal award.

§ 200.32 Data Universal Numbering System (DUNS) number.

DUNS number means the nine-digit number established and assigned by Dun and Bradstreet, Inc. (D&B) to uniquely identify entities. A non-Fed-eral entity is required to have a DUNS number in order to apply for, receive, and report on a Federal award. A DUNS number may be obtained from D&B by telephone (currently 866–705–5711) or the Internet (currently at http:// fedgov.dnb.com/webform).

§ 200.33 Equipment.

Equipment means tangible personal property (including information tech-nology systems) having a useful life of more than one year and a per-unit ac-quisition cost which equals or exceeds the lesser of the capitalization level es-tablished by the non-Federal entity for financial statement purposes, or $5,000.

See also §§ 200.12 Capital assets, 200.20 Computing devices, 200.48 General pur-pose equipment, 200.58 Information technology systems, 200.89 Special pur-pose equipment, and 200.94 Supplies.

§ 200.34 Expenditures.

Expenditures means charges made by a non-Federal entity to a project or program for which a Federal award was received.

(a) The charges may be reported on a cash or accrual basis, as long as the methodology is disclosed and is con-sistently applied.

(b) For reports prepared on a cash basis, expenditures are the sum of:

(1) Cash disbursements for direct charges for property and services;

(2) The amount of indirect expense charged;

(3) The value of third-party in-kind contributions applied; and

(4) The amount of cash advance pay-ments and payments made to sub-recipients.

(c) For reports prepared on an ac-crual basis, expenditures are the sum of:

(1) Cash disbursements for direct charges for property and services;

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(2) The amount of indirect expense incurred;

(3) The value of third-party in-kind contributions applied; and

(4) The net increase or decrease in the amounts owed by the non-Federal entity for:

(i) Goods and other property re-ceived;

(ii) Services performed by employees, contractors, subrecipients, and other payees; and

(iii) Programs for which no current services or performance are required such as annuities, insurance claims, or other benefit payments.

§ 200.35 Federal agency.

Federal agency means an ‘‘agency’’ as defined at 5 U.S.C. 551(1) and further clarified by 5 U.S.C. 552(f).

§ 200.36 Federal Audit Clearinghouse

(FAC).

FAC means the clearinghouse des-ignated by OMB as the repository of record where non-Federal entities are required to transmit the reporting packages required by Subpart F—Audit Requirements of this part. The mailing address of the FAC is Federal Audit Clearinghouse, Bureau of the Census, 1201 E. 10th Street, Jeffersonville, IN 47132 and the web address is: http://har-vester.census.gov/sac/. Any future up-dates to the location of the FAC may be found at the OMB Web site.

§ 200.37 Federal awarding agency.

Federal awarding agency means the Federal agency that provides a Federal award directly to a non-Federal entity.

§ 200.38 Federal award.

Federal award has the meaning, de-pending on the context, in either para-graph (a) or (b) of this section:

(a)(1) The Federal financial assist-ance that a non-Federal entity receives directly from a Federal awarding agen-cy or indirectly from a pass-through entity, as described in § 200.101 Applica-bility; or

(2) The cost-reimbursement contract under the Federal Acquisition Regula-tions that a non-Federal entity re-ceives directly from a Federal award-ing agency or indirectly from a pass-through entity, as described in § 200.101 Applicability.

(b) The instrument setting forth the terms and conditions. The instrument is the grant agreement, cooperative agreement, other agreement for assist-ance covered in paragraph (b) of § 200.40 Federal financial assistance, or the cost-reimbursement contract awarded under the Federal Acquisition Regula-tions.

(c) Federal award does not include other contracts that a Federal agency uses to buy goods or services from a contractor or a contract to operate Federal government owned, contractor operated facilities (GOCOs).

(d) See also definitions of Federal fi-nancial assistance, grant agreement, and cooperative agreement.

§ 200.39 Federal award date.

Federal award date means the date when the Federal award is signed by the authorized official of the Federal awarding agency.

§ 200.40 Federal financial assistance.

(a) For grants and cooperative agree-ments, Federal financial assistance means assistance that non-Federal en-tities receive or administer in the form of:

(1) Grants;

(2) Cooperative agreements;

(3) Non-cash contributions or dona-tions of property (including donated surplus property);

(4) Direct appropriations;

(5) Food commodities; and

(6) Other financial assistance (except assistance listed in paragraph (b) of this section).

(b) For Subpart F—Audit Require-ments of this part, Federal financial as-sistance also includes assistance that non-Federal entities receive or admin-ister in the form of:

(1) Loans;

(2) Loan Guarantees;

(3) Interest subsidies; and

(4) Insurance.

(c) Federal financial assistance does not include amounts received as reim-bursement for services rendered to in-dividuals as described in § 200.502 Basis for determining Federal awards ex-pended, paragraph (h) and (i) of this part.

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2 CFR Ch. II (1–1–14 Edition) § 200.41

§ 200.41 Federal interest.

Federal interest means, for purposes of

§ 200.329 Reporting on real property or when used in connection with the ac-quisition or improvement of real prop-erty, equipment, or supplies under a Federal award, the dollar amount that is the product of the:

(a) Federal share of total project costs; and

(b) Current fair market value of the property, improvements, or both, to the extent the costs of acquiring or im-proving the property were included as project costs.

§ 200.42 Federal program.

Federal program means:

(a) All Federal awards which are as-signed a single number in the CFDA.

(b) When no CFDA number is as-signed, all Federal awards to non-Fed-eral entities from the same agency made for the same purpose should be combined and considered one program.

(c) Notwithstanding paragraphs (a) and (b) of this definition, a cluster of programs. The types of clusters of pro-grams are:

(1) Research and development (R&D);

(2) Student financial aid (SFA); and

(3) ‘‘Other clusters,’’ as described in the definition of Cluster of Programs.

§ 200.43 Federal share.

Federal share means the portion of the total project costs that are paid by Federal funds.

§ 200.44 Final cost objective.

Final cost objective means a cost ob-jective which has allocated to it both direct and indirect costs and, in the non-Federal entity’s accumulation sys-tem, is one of the final accumulation points, such as a particular award, in-ternal project, or other direct activity of a non-Federal entity. See also §§ 200.28 Cost objective and 200.60 Inter-mediate cost objective.

§ 200.45 Fixed amount awards.

Fixed amount awards means a type of grant agreement under which the Fed-eral awarding agency or pass-through entity provides a specific level of sup-port without regard to actual costs in-curred under the Federal award. This type of Federal award reduces some of the administrative burden and record-keeping requirements for both the non- Federal entity and Federal awarding agency or pass-through entity. Ac-countability is based primarily on per-formance and results. See §§ 200.201 Use of grant agreements (including fixed amount awards), cooperative agree-ments, and contracts, paragraph (b) and 200.332 Fixed amount subawards.

§ 200.46 Foreign public entity.

Foreign public entity means:

(a) A foreign government or foreign governmental entity;

(b) A public international organiza-tion, which is an organization entitled to enjoy privileges, exemptions, and immunities as an international organi-zation under the International Organi-zations Immunities Act (22 U.S.C. 288– 288f);

(c) An entity owned (in whole or in part) or controlled by a foreign govern-ment; or

(d) Any other entity consisting whol-ly or partially of one or more foreign governments or foreign governmental entities.

§ 200.47 Foreign organization.

Foreign organization means an entity that is:

(a) A public or private organization located in a country other than the United States and its territories that are subject to the laws of the country in which it is located, irrespective of the citizenship of project staff or place of performance;

(b) A private nongovernmental orga-nization located in a country other than the United States that solicits and receives cash contributions from the general public;

(c) A charitable organization located in a country other than the United States that is nonprofit and tax ex-empt under the laws of its country of domicile and operation, and is not a university, college, accredited degree-granting institution of education, pri-vate foundation, hospital, organization engaged exclusively in research or sci-entific activities, church, synagogue, mosque or other similar entities orga-nized primarily for religious purposes;

or

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(d) An organization located in a country other than the United States not recognized as a Foreign Public En-tity.

§ 200.48 General purpose equipment.

General purpose equipment means equipment which is not limited to re-search, medical, scientific or other technical activities. Examples include office equipment and furnishings, mod-ular offices, telephone networks, infor-mation technology equipment and sys-tems, air conditioning equipment, re-production and printing equipment, and motor vehicles. See also Equip-ment and Special Purpose Equipment.

§ 200.49 Generally Accepted Account-ing Principles (GAAP).

GAAP has the meaning specified in accounting standards issued by the Government Accounting Standards Board (GASB) and the Financial Ac-counting Standards Board (FASB).

§ 200.50 Generally Accepted Govern-ment Auditing Standards (GAGAS).

GAGAS means generally accepted government auditing standards issued by the Comptroller General of the United States, which are applicable to financial audits.

§ 200.51 Grant agreement.

Grant agreement means a legal instru-ment of financial assistance between a Federal awarding agency or pass-through entity and a non-Federal enti-ty that, consistent with 31 U.S.C. 6302, 6304:

(a) Is used to enter into a relation-ship the principal purpose of which is to transfer anything of value from the Federal awarding agency or pass-through entity to the non-Federal enti-ty to carry out a public purpose au-thorized by a law of the United States (see 31 U.S.C. 6101(3)); and not to ac-quire property or services for the Fed-eral awarding agency or pass-through entity’s direct benefit or use;

(b) Is distinguished from a coopera-tive agreement in that it does not pro-vide for substantial involvement be-tween the Federal awarding agency or pass-through entity and the non-Fed-eral entity in carrying out the activity contemplated by the Federal award.

(c) Does not include an agreement that provides only:

(1) Direct United States Government cash assistance to an individual;

(2) A subsidy;

(3) A loan;

(4) A loan guarantee; or

(5) Insurance.

§ 200.52 Hospital.

Hospital means a facility licensed as a hospital under the law of any state or a facility operated as a hospital by the United States, a state, or a subdivision of a state.

§ 200.53 Improper payment.

(a) Improper payment means any pay-ment that should not have been made or that was made in an incorrect amount (including overpayments and underpayments) under statutory, con-tractual, administrative, or other le-gally applicable requirements; and

(b) Improper payment includes any payment to an ineligible party, any payment for an ineligible good or serv-ice, any duplicate payment, any pay-ment for a good or service not received (except for such payments where au-thorized by law), any payment that does not account for credit for applica-ble discounts, and any payment where insufficient or lack of documentation prevents a reviewer from discerning whether a payment was proper.

§ 200.54 Indian tribe (or ‘‘federally rec-ognized Indian tribe’’).

Indian tribe means any Indian tribe, band, nation, or other organized group or community, including any Alaska Native village or regional or village corporation as defined in or established pursuant to the Alaska Native Claims Settlement Act (43 U.S.C. Chapter 33), which is recognized as eligible for the special programs and services provided by the United States to Indians be-cause of their status as Indians (25 U.S.C. 450b(e)). See annually published Bureau of Indian Affairs list of Indian Entities Recognized and Eligible to Re-ceive Services.

§ 200.55 Institutions of Higher Edu-cation (IHEs).

IHE is defined at 20 U.S.C. 1001.

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2 CFR Ch. II (1–1–14 Edition) § 200.56

§ 200.56 Indirect (facilities & adminis-trative (F&A)) costs.

Indirect (F&A) costs means those costs incurred for a common or joint purpose benefitting more than one cost objec-tive, and not readily assignable to the cost objectives specifically benefitted, without effort disproportionate to the results achieved. To facilitate equi-table distribution of indirect expenses to the cost objectives served, it may be necessary to establish a number of pools of indirect (F&A) costs. Indirect (F&A) cost pools should be distributed to benefitted cost objectives on bases that will produce an equitable result in consideration of relative benefits de-rived.

§ 200.57 Indirect cost rate proposal.

Indirect cost rate proposal means the documentation prepared by a non-Fed-eral entity to substantiate its request for the establishment of an indirect cost rate as described in Appendix III to Part 200—Indirect (F&A) Costs Iden-tification and Assignment, and Rate Determination for Institutions of High-er Education (IHEs) through Appendix VII to Part 200—States and Local Gov-ernment and Indian Tribe Indirect Cost Proposals of this part.

§ 200.58 Information technology sys-tems.

Information technology systems means computing devices, ancillary equip-ment, software, firmware, and similar procedures, services (including support services), and related resources. See also §§ 200.20 Computing devices and

200.33 Equipment.

§ 200.59 Intangible property.

Intangible property means property having no physical existence, such as trademarks, copyrights, patents and patent applications and property, such as loans, notes and other debt instru-ments, lease agreements, stock and other instruments of property owner-ship (whether the property is tangible or intangible).

§ 200.60 Intermediate cost objective.

Intermediate cost objective means a cost objective that is used to accumu-late indirect costs or service center costs that are subsequently allocated to one or more indirect cost pools or final cost objectives. See also § 200.28 Cost objective and § 200.44 Final cost objective.

§ 200.61 Internal controls.

Internal controls means a process, im-plemented by a non-Federal entity, de-signed to provide reasonable assurance regarding the achievement of objec-tives in the following categories:

(a) Effectiveness and efficiency of op-erations;

(b) Reliability of reporting for inter-nal and external use; and

(c) Compliance with applicable laws and regulations.

§ 200.62 Internal control over compli-ance requirements for Federal awards.

Internal control over compliance re-quirements for Federal awards means a process implemented by a non-Federal entity designed to provide reasonable assurance regarding the achievement of the following objectives for Federal awards:

(a) Transactions are properly re-corded and accounted for, in order to:

(1) Permit the preparation of reliable financial statements and Federal re-ports;

(2) Maintain accountability over as-sets; and

(3) Demonstrate compliance with Federal statutes, regulations, and the terms and conditions of the Federal award;

(b) Transactions are executed in com-pliance with:

(1) Federal statutes, regulations, and the terms and conditions of the Federal award that could have a direct and ma-terial effect on a Federal program; and

(2) Any other Federal statutes and regulations that are identified in the Compliance Supplement; and

(c) Funds, property, and other assets are safeguarded against loss from un-authorized use or disposition.

§ 200.63 Loan.

Loan means a Federal loan or loan guarantee received or administered by a non-Federal entity, except as used in the definition of § 200.80 Program in-come.

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OMB Guidance § 200.68

(a) The term ‘‘direct loan’’ means a disbursement of funds by the Federal government to a non-Federal borrower under a contract that requires the re-payment of such funds with or without interest. The term includes the pur-chase of, or participation in, a loan made by another lender and financing arrangements that defer payment for more than 90 days, including the sale of a Federal government asset on credit terms. The term does not include the acquisition of a federally guaranteed loan in satisfaction of default claims or the price support loans of the Com-modity Credit Corporation.

(b) The term ‘‘direct loan obligation’’ means a binding agreement by a Fed-eral awarding agency to make a direct loan when specified conditions are ful-filled by the borrower.

(c) The term ‘‘loan guarantee’’ means any Federal government guarantee, in-surance, or other pledge with respect to the payment of all or a part of the principal or interest on any debt obli-gation of a non-Federal borrower to a non-Federal lender, but does not in-clude the insurance of deposits, shares, or other withdrawable accounts in fi-nancial institutions.

(d) The term ‘‘loan guarantee com-mitment’’ means a binding agreement by a Federal awarding agency to make a loan guarantee when specified condi-tions are fulfilled by the borrower, the lender, or any other party to the guar-antee agreement.

§ 200.64 Local government.

Local government means any unit of government within a state, including a:

(a) County;

(b) Borough;

(c) Municipality;

(d) City;

(e) Town;

(f) Township;

(g) Parish;

(h) Local public authority, including any public housing agency under the United States Housing Act of 1937;

(i) Special district;

(j) School district;

(k) Intrastate district;

(l) Council of governments, whether or not incorporated as a nonprofit cor-poration under state law; and

(m) Any other agency or instrumen-tality of a multi-, regional, or intra-state or local government.

§ 200.65 Major program.

Major program means a Federal pro-gram determined by the auditor to be a major program in accordance with § 200.518 Major program determination or a program identified as a major pro-gram by a Federal awarding agency or pass-through entity in accordance with § 200.503 Relation to other audit re-quirements, paragraph (e).

§ 200.66 Management decision.

Management decision means the eval-uation by the Federal awarding agency or pass-through entity of the audit findings and corrective action plan and the issuance of a written decision to the auditee as to what corrective ac-tion is necessary.

§ 200.67 Micro-purchase.

Micro-purchase means a purchase of supplies or services using simplified ac-quisition procedures, the aggregate amount of which does not exceed the micro-purchase threshold. Micro-pur-chase procedures comprise a subset of a non-Federal entity’s small purchase procedures. The non-Federal entity uses such procedures in order to expe-dite the completion of its lowest-dollar small purchase transactions and mini-mize the associated administrative burden and cost. The micro-purchase threshold is set by the Federal Acquisi-tion Regulation at 48 CFR Subpart 2.1 (Definitions). It is $3,000 except as oth-erwise discussed in Subpart 2.1 of that regulation, but this threshold is peri-odically adjusted for inflation.

§ 200.68 Modified Total Direct Cost

(MTDC).

MTDC means all direct salaries and wages, applicable fringe benefits, mate-rials and supplies, services, travel, and subawards and subcontracts up to the first $25,000 of each subaward or sub-contract (regardless of the period of performance of the subawards and sub-contracts under the award). MTDC ex-cludes equipment, capital expendi-tures, charges for patient care, rental costs, tuition remission, scholarships and fellowships, participant support

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2 CFR Ch. II (1–1–14 Edition) § 200.69 costs and the portion of each subaward and subcontract in excess of $25,000.

Other items may only be excluded when necessary to avoid a serious in-equity in the distribution of indirect costs, and with the approval of the cog-nizant agency for indirect costs.

§ 200.69 Non-Federal entity.

Non-Federal entity means a state, local government, Indian tribe, institu-tion of higher education (IHE), or non-profit organization that carries out a Federal award as a recipient or sub-recipient.

§ 200.70 Nonprofit organization.

Nonprofit organization means any cor-poration, trust, association, coopera-tive, or other organization, not includ-ing IHEs, that:

(a) Is operated primarily for sci-entific, educational, service, chari-table, or similar purposes in the public interest;

(b) Is not organized primarily for profit; and

(c) Uses net proceeds to maintain, improve, or expand the operations of the organization.

§ 200.71 Obligations.

When used in connection with a non-

Federal entity’s utilization of funds under a Federal award, obligations means orders placed for property and services, contracts and subawards made, and similar transactions during a given period that require payment by the non-Federal entity during the same or a future period.

§ 200.72 Office of Management and Budget (OMB).

OMB means the Executive Office of the President, Office of Management and Budget.

§ 200.73 Oversight agency for audit.

Oversight agency for audit means the

Federal awarding agency that provides the predominant amount of funding di-rectly to a non-Federal entity not as-signed a cognizant agency for audit.

When there is no direct funding, the Federal awarding agency which is the predominant source of pass-through funding must assume the oversight re-sponsibilities.