Course ID: UGFG-202

Let’s Build an Indirect Rate for Nonprofits with Federal Awards

We will go through the various steps to build an indirect cost rates for nonprofits with Federal grants. We will help you with the necessary considerations and components with developing an indirect rate. This course will answer the most important question, “where do I start?” and cover the practical “how-to”:
– Develop an indirect cost rate for nonprofits following the rules from Appendix IV, Subpart E
– Utilize the most widely accepted agency template for HHS to prepare an indirect rate proposal
– Address a less known method for allocating indirect cost through the use of a special rate allocation via a “bifurcated” indirect rate to deal with different levels of facility cost in more than one locations to avoid double charging.

Please note that pass-through entities such as large nonprofits, hospitals, institutes of higher education and local governmental units must understand nonprofit indirect rates as they have to manage the indirect rates that are negotiated in their sub-awards.

Learning Objectives

Understand the steps in building an indirect rate for nonprofits with Federal grants
Prepare a simple indirect rate (Depending on individual skill level)
Recognize the types of accounting reports and structures required in building an indirect rate
Avoid “double charging” of direct-purpose-cost charged both direct and indirect, particularly rent

Major Topics

Defining direct and indirect costs
Understanding basic indirect rate mechanics
What is an ideal indirect rate?
What you should consider before preparing an indirect rate
List of critical items required to prepare an indirect rate
We will look at a real nonprofit and how it developed an indirect cost rate proposal
We will use the post-audit trial balance and Statement of Functional Expense
We will use the HHS Indirect Cost Rate Proposal template
We will discuss transition issues, i.e. an entity that has no indirect rate and charges occupancy direct to using a negotiated indirect rate
How to avoid double charging during the transition process
The use of a special indirect rates such as a bifurcated G&A rate for programs with and without occupancy

Who Should Attend

Public accountants that are involved with Single (old A-133) Audits; Consultants that need updated understanding of the new rules; All public accountants that require a refresher course that covers all of the critical elements; Executive Directors, COO, CFO, director of grants or finance that have a significant amount of Federal awards, grant administrators, Principal investigators (PI) and other program personnel charged with managing grants with nonprofits; hospitals; institutes of higher education; state and local, tribal units of government; Federal personnel; even commercial firms engaged with Federal awards

Fields of Study

Accounting (Governmental)

Prerequisites

Based on UGFG-201

Provider

Business Learning Institute

CPE Credits

1.5

Level

Intermediate

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