Allowable Expenses on Grants
Expenses charged to sponsored grants must comply with federal regulations (2 CFR §200 Uniform Guidance), sponsor terms and conditions, and ISU policies.
Overview
The University may directly pay or reimburse individuals for expenses that are:
- Necessary – essential to achieve the project’s objectives
- Reasonable – reflect what a prudent person would pay under similar circumstances
- Allocable – clearly benefit the specific project being charged
- Consistent – treated uniformly across all University activities
All expenses must directly support the goals and scope of the sponsored project and occur within the project period.
Allowable Costs
Allowable expenses may include:
- Salaries and wages for personnel working on the project
- Fringe benefits related to project effort
- Materials and supplies used directly in the research
- Approved equipment purchases
- Project-related travel
- Participant support costs (if approved)
- Publication and dissemination costs
- Consultant and subrecipient expenses that directly benefit the project
Unallowable Expenses
Certain costs may not be charged to sponsored awards, including:
- Alcoholic beverages
- Entertainment, social, or personal activities
- Fines, penalties, or late fees
- Gifts or donations
- General office supplies and administrative salaries (unless specifically approved)
- Fundraising, lobbying, or marketing costs
- Excessive or luxury travel or lodging
- Equipment not identified in the approved budget or unrelated to the project
Salaries and Fringe Benefits
Compensation charged to a sponsored award must:
- Reflect actual effort devoted to the project
- Match the committed effort in the proposal or award document
- Apply fringe benefits consistently under institutional policy
Materials, Supplies, and Equipment
- Costs of materials and supplies are allowable if used directly in the project
- Equipment purchases require prior approval if not included in the award budget
- General-purpose equipment (e.g., office furniture, administrative computers) is unallowable unless specifically justified and approved
Travel costs are allowable when:
- Necessary to fulfill project objectives
- Comply with University travel policy and sponsor rules
- Travelers use the lowest reasonable rate and standard accommodations
- Documentation supports the project connection
Unallowable travel costs: personal or recreational components
Participant support refers to costs paid to or on behalf of participants in a conference, workshop, or training activity supported by the award.
Allowable participant support expenses may include:
- Participant stipends or subsistence allowances
- Travel costs for participants
- Registration fees or materials for training
Important: Participant support costs must be explicitly approved in the award budget and cannot be rebudgeted without sponsor approval.
Questions?
For further questions regarding allowable costs, please contact your Grant and Contract Accountant (GCA).