Government Grants: Cost Allowability and Allocability

Venable’s federal grants attorneys assist our clients with interpretation and application of federal cost principles as applied to governmental and nonprofit entities, and federal cost principles as applied to commercial/for-profit entities. Such assistance includes:

• Routine advice on cost allowability under the baseline principles of reasonableness and adequate documentation and the detailed “selected items of cost” for specific cost categories
• Assistance with time and effort matters, from system design and compliance to audit resolution and cost disallowance defense
• Interpretation and implementation support with respect to more nuanced cost types, including, but not limited to, advertising and public relations, lobbying, legal expenses, employee incentive compensation (bonuses), idle facility space, self-insurance, and termination costs
• Cost allocation guidance to facilitate efficient and compliant workflows that support readily accessible cost data and efficient drawdown of funds and invoicing, as applicable
• Review and support of cost allocation plan drafting and indirect cost rate proposal negotiation, including strategic considerations relevant to use of a negotiated rate (NICRA) as compared with election of the de minimis rate; planning with respect to pooled costs, allocation bases, and NICRA types; specific treatment of certain cost types as discussed above; and resolution of disagreements with rate negotiators
• Defense against audit and agency review findings, from resolution support to cost disallowance appeals (both formal and informal)

Often working hand in hand with a client’s chief financial officer or controller, our federal grants attorneys provide the regulatory guidance a client needs to stay grounded in the federal cost principles and the Generally Accepted Accounting Principle (GAAP).