will be responsible for negotiating and/or monitoring the subrecipient’s plan. (3) Each Indian tribal government desiring of indirect costs must submit its ICRP to its cognizant agency, which generally is the Department of the Interior. (4) ICRPs must be developed (and, when required, submitted) within 6 months after the close of the governmental fiscal year. unit’s e. Documentation and Certification Requirements The documentation and certification requirements for ICRPs are included in A87, Attachment E, paragraphs D.2 and 3, respectively. The proposal and related documentation must be retained for audit in accordance with the record retention requirements contained in the A-102 Common Rule. 2. Audit Objectives State/Local Department or Agency Costs Direct and Indirect – – a. Obtain an understanding of internal control over the compliance requirements for State/local department or agency costs, assess risk, and test internal control as required by OMB Circular A-133 §___.500(c). b. Determine whether the governmental unit complied with the provisions of A-87 as follows: (1) Direct charges to Federal awards were for allowable costs. (2) Charges to cost pools used in calculating indirect cost rates were for allowable costs. (3) The methods for allocating the costs are in accordance with the applicable cost principles, and produce an equitable and consistent distribution of costs (e.g., all activities that benefit from the indirect cost, including unallowable activities, must receive an appropriate allocation of indirect costs). (4) Indirect cost rates were applied in accordance with approved indirect cost rate agreements (ICRA), or special award provisions or limitations, if different from those stated in negotiated rate agreements. (5) For local departments or agencies that do not have to submit an ICRP to the cognizant Federal agency, indirect cost rates were applied in accordance with the ICRP maintained on file.
will be responsible for negotiating and/or monitoring the subrecipient’s plan. (3) Each Indian tribal government desiring of indirect costs must submit its ICRP to its cognizant agency, which generally is the Department of the Interior. (4) ICRPs must be developed (and, when required, submitted) within 6 months after the close of the governmental unit’s fiscal year. e. Documentation and Certification Requirements The documentation and certification requirements for ICRPs are included in A87, Attachment E, paragraphs D.2 and 3, respectively. The proposal and related documentation must be retained for audit in accordance with the record retention requirements contained in the A-102 Common Rule. 2. Audit Objectives – State/Local Department or Agency Costs – Direct and Indirect a. Obtain an understanding of internal control over the compliance requirements for State/local department or agency costs, assess risk, and test internal control as required by OMB Circular A-133 §___.500(c). b. Determine whether the governmental unit complied with the provisions of A-87 as follows: (1) Direct charges to Federal awards were for allowable costs. (2) Charges to cost pools used in calculating indirect cost rates were for allowable costs. (3) The methods for allocating the costs are in accordance with the applicable cost principles, and produce an equitable and consistent distribution of costs (e.g., all activities that benefit from the indirect cost, including unallowable activities, must receive an appropriate allocation of indirect costs). (4) Indirect cost rates were applied in accordance with approved indirect cost rate agreements (ICRA), or special award provisions or limitations, if different from those stated in negotiated rate agreements. (5) For local departments or agencies that do not have to submit an ICRP to the cognizant Federal agency, indirect cost rates were applied in accordance with the ICRP maintained on file.
pt3.docx