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Division of Financial Services

Sponsored Programs
Kansas State University
10 Anderson Hall
Manhattan, KS 66506


(785) 532-6207
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A-21 Revisions Effective June 9, 2004

What changes were made and how do they affect grant accounting at KSU?

OMB released new versions of A-21 (educational institutions), A-87 (state & local gov’t), and A-122 (non-profits) in May of this year, to be effective on June 9, 2004. The changes are the result of an effort to achieve more consistency in the wording of these three circulars. Circular A-21 is the one the matters to those of us at KSU, of course. The changes in wording were limited to Section J, “General provisions for selected items of cost”. Some wording was changed and sections were re-numbered. Upon review, the consensus by the university community is that there were no real substantive changes. The only real effect is for those of us in the SPA Office that are involved in preparing the F&A Cost Rate Proposal, and even those changes will be fairly minor for KSU.

A “crosswalk” for the new numbering of this section is available on the “News” section of the SPA website and is also available in the Federal Register.

Crosswalk for Circular A-21

What exactly is Section J and how does it relate to what can be charged to grant accounts?

Section J describes allowability of certain types of costs. The key to interpreting this section, though, is to remember that the overall purpose of A-21 is to tell universities how to structure their F&A cost rate proposal. Section J establishes allowability “irrespective of whether a particular item of cost is properly treated as direct or F&A cost” and “allowability in each case should be based on treatment provided for similar or related items of cost”. In other words, just because you see that a selected item of cost is described as “allowable” in Section J, does not always mean that it is allowable as a direct charge to a sponsored project account. It may only mean that it is allowable for us to treat it as an indirect cost and include it in the F&A cost rate proposal. In some of the items in Section J, treatment of the item as direct or indirect is addressed, for others it is not. In cases where it is not, other sections of A-21, such as Section F on identifying and assigning F&A costs, and Section C on allowability and consistency of accumulating costs must also be considered.

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