Accounting Services

Effective: 5/15/07


Facilities and Administrative Costs:

F&A or indirect costs are costs associated with the conduct of sponsored activities that are incurred for common or joint objectives and therefore are not readily identifiable with a specific project. Included are expenses relates to Human Resource, Fiscal Affairs, the President’s Office, Dean’s offices, and costs related to the general operations and maintenance of the University. These costs generally fall into one of the following cost pools:

  • Building Depreciation
  • Equipment depreciation
  • Interest
  • Operations and Maintenance
  • General Administration
  • Department Administration
  • Sponsored Programs Administration
  • Library
  • Student Services Administration
  • F&A costs are real costs of institutional support for sponsored program activity.

Sponsored program budgets are expected to recover F&A costs at the maximum allowable rate.

Facilities and Administrative Rates:

F&A rates are federally negotiated and developed to recover the indirect costs associated with the conduct of sponsored activities. These rates are applied to modified total direct costs (MTDC) (see definition below).

The Comptroller’s Office is responsible for development and negotiation of the F&A Cost Rate Agreement which is applicable to awards for both Clemson University (CU) and Clemson University Research Foundation (CURF).

The current negotiated and approved rates are posted on the Comptroller’s website.

The approved indirect cost rates are expected to be applied to all contracts and grants. Exceptions are rare and must be approved by the Vice President for Research . See for further information.

Definitions (listed alphabetically)

Instruction/Departmental Research (IDR) (circular A-21 definition) :

Instruction means the teaching and training activities of an institution. Except for research training as it is explained below, this term includes all teaching and training activities, whether they are offered for credits toward a degree or certificate or on a non credit basis, and whether they are offered through regular academic departments or separate divisions, such as a summer school division or an extension division. Also considered part of this major function are departmental research, and, where agreed to, university research.

(1) Sponsored instruction and training means specific instructional or training activity established by grant, contract, or cooperative agreement. For purposes of the federal cost principles, this activity may be considered a major function even though an institution's accounting treatment may include it in the instruction function.

(2) Departmental research means research, development and scholarly activities that are not organized research and, consequently, are not separately budgeted and accounted for. Departmental research, for purposes of this document, is not considered as a major function, but as a part of the instruction function of the institution.

Modified Total Direct Costs (MTDC):

MTDC is calculated by subtracting from total direct costs expenses such as the charges for capital equipment, renovation and alteration, tuition, rent, and each subcontract in excess of the first $25,000. See the Federal Office of Management and Budget circular A-21 for a complete list.


The off campus rate is applied to federally sponsored projects that are not conducted in space owned or controlled by Clemson University or Clemson University Research Foundation.

Organized Research (OR) (circular A-21 definition):

Organized research means all research and development activities of an institution that are separately budgeted and accounted for (This is in the perspective of external sponsors where the agreement states specific deadlines, deliverables, etc.). It includes:

(1) Sponsored research means all research and development activities that are sponsored by Federal and non Federal agencies and organizations. This term includes activities involving the training of individuals in research techniques (commonly called research training) where such activities utilize the same facilities as other research and development activities and where such activities are not included in the instruction function.

(2) University research (cost share) means all research and development activities that are separately budgeted and accounted for by the institution under an internal application of institutional funds. University research, for purposes of this document (circular A-21), shall be combined with sponsored research under the function of organized research.

Other Institutional Activities (OIA) (circular A-21 definition):

Other institutional activities means all activities of an institution except:

(1) instruction, departmental research, organized research, and other sponsored activities, as defined above;

(2) F&A cost activities identified in Section F; and

(3) specialized service facilities described in Section J.47. Other institutional activities include operation of residence halls, dining halls, hospitals and clinics, student unions, intercollegiate athletics, bookstores, faculty housing, student apartments, guest houses, chapels, theaters, public museums, and other similar auxiliary enterprises. This definition also includes any other categories of activities, costs of which are "unallowable" to sponsored agreements, unless otherwise indicated in the agreements.

Other Sponsored Activities (OSA) (circular A-21 definition):

Other sponsored activities mean programs and projects financed by Federal and non Federal agencies and organizations which involve the performance of work other than instruction and organized research. Examples of such programs and projects are health service projects, and community service programs. However, when any of these activities are undertaken by the institution without outside support, they may be classified as other institutional activities.