Grant Guidance Changes
2 CFR 200
Uniform Administrative Requirements,
Cost Principles, and Audit Requirements
for Federal Awards
The “Supercircular”
2 CFR 200 Issuance
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Final Rule published by the US Office of Management & Budget (OMB)
in the Federal Register in Vol. 78, No. 248 on December 26, 2013.
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Supersedes the requirements of OMB Circulars A-21, A-87, A-110, and
A-122; Circulars A-89, A-102 and A-133; and the guidance in Circular A50 on Single Audit Act follow-up.
2 CFR 200 Applicability
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Uniform implementation effective December 26, 2014; applicable to
new awards and to incremental funding awarded on or after December
26, 2014.
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One exception – Subpart F (Audit Requirements) is effective the first
fiscal year beginning after December 26, 2014.
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Existing awards will continue to be governed by the terms and
conditions of the Federal award.
However, non-federal entities implementing entity-wide
system changes to comply with the uniform guidance after
December 26, 2014 may also apply the changes to existing
Federal awards.
2 CFR 200 Purpose
Establish uniform administrative requirements, cost
principles, and audit requirements for federal
awards to non-Federal entities.
2 CFR 200 Benefits
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Establishes a government-wide framework for grants management.
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Reduces the administrative burden for non-Federal entities by:
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Reduces the risk of waste, fraud and abuse by:
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Eliminating duplicative and conflicting guidance
Providing consistent and transparent treatment of costs
Focusing on performance over compliance for accountability
Limiting allowable costs to make the best use of Federal resources
Strengthening oversight
Targeting audit requirements
Encourages family friendly policies.
2 CFR 200 Framework
Divided into seven subparts:
Subpart A: Acronyms and Definitions
Subpart B: General Provisions
Subpart C: Pre-Federal Award Requirements and Contents of Federal
Awards
Subpart D: Post Federal Award Requirements
Subpart E: Cost Principles
Subpart F: Audit Requirements
Subpart B: General Provisions
2 CFR 200 Framework
Eleven Appendices:
I: Full text of Notices
II: Contract provisions for Non-federal Entity Contracts Under Federal
Awards
III: F & A Cost Identification & Assignment, and Rate Determination for
Institutions of Higher Education
IV: F & A Cost Identification & Assignment, and Rate Determination for
Nonprofit Organizations
V: State/Local Government and Indian Tribe-wide
Central Service Cost Allocation Plans
2 CFR 200 Framework
Appendices:
VI: Public Assistance Cost Allocation Plans
VII: States and Local Government and Indian Tribe Indirect Cost Proposals
VIII: Nonprofit Organizations Exempted From Subpart E- Cost Principles
IX: Hospital Cost Principles (45 CFR 74, Appendix E)
X: Data Collection Form
XI: Compliance Supplement
2 CFR 200 Changes
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Performance Measurement (2 CFR 200.301)
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The Federal awarding agency must require the non-Federal entity to use
OMB-approved government-wide standard forms when providing financial
and performance information.
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The non-Federal entity will be required to relate financial data to
performance accomplishments and when applicable, provide cost
information to demonstrate cost effect practices.
2 CFR 200 Changes
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Prior Written Approval (2 CFR 200.407)
Provides a one-stop comprehensive list of the situations under which the nonFederal entity should seek prior approval from the Federal awarding agency.
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Indirect Costs (F&A) (2 CFR 200.414)
In addition to the procedures in the appendices, a non-Federal entity
(exceptions apply) that has never received a negotiated indirect cost rate may
elect to charge a de minimis rate of 10% of Modified Total Direct Costs
(exceptions apply).
2 CFR 200 Changes
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Audit Requirements (2 CFR 200.507)
Requires non-federal entities expending $750,000 or more of Federal funds
during the non-entity’s fiscal year must have a single or program-specific
audit.
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Program Income (2 CFR 200.307)
Redefined (2 CFR 200.80) to include “the use or rental of real or personal
property acquired under Federal awards, the sale of commodities or items
fabricated under a Federal award, license fees and royalties on patent and
copyrights, and principal and interest on loans made with Federal awards.”
(new) The Federal awarding agency may negotiate agreements
with non-Federal entities regarding the appropriate uses
of income earned after the period of performance.
2 CFR 200 Changes
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Selected Items of Cost (Subpart E)
200.432 Conferences (change) – allowable conference costs paid by the nonFederal entity as a sponsor or host of the conference may include rental of
facilities, speakers’ fees, costs of meals and refreshments,
local transportation and other items incidental, unless
restricted by terms and conditions of the award.
(new) The costs of finding (not providing) locally available dependent care
resources are allowable.
2 CFR 200 Changes
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Selected Items of Cost (Subpart E)
200.438 Entertainment Costs (change) – allowable when costs have a program
purpose and are authorized either in the approved budget or with prior
written approval of the Federal awarding agency.
200.441 Fines, Penalties, Damages and Other Settlements (change) – costs
resulting from violations and alleged violations of Federal, State, Local,
Tribal and foreign laws are unallowable except when
incurred as a result of award compliance.
2 CFR 200 Changes
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Selected Items of Cost (Subpart E)
200.474 Travel Costs (new) – temporary dependent care costs (meeting
specific standards) above and beyond the regular dependent care that directly
results from travel to conferences is allowable.
2 CFR 200 Implementation
FEMA is currently working with DHS to promulgate implementing
regulation; which will need to first be approved by the OMB.
Once approved, the DHS CFO Financial Management Policy Manual
will be updated.
Publication of implementing policy is expected to on or before
December 26, 2014.
End of presentation.
2 CFR 200
Questions ?
Federal Funding Accountability
and
Transparency Act
(FFATA)