Proposed OMB Uniform Guidance: Cost Principles, Audit, and Administrative Requirements for Federal Awards
Nathan Haines, Jim Carter, Anne Sullivan
On January 31, 2013, the federal government released a proposal for the OMB Uniform Guidance: Cost Principles, Audit, and Administrative Requirements for Federal Awards, a consolidation of eight Office of Management and Budget (OMB) Circulars intended to improve the clarity and accessibility of federal guidance for management federal grants and cooperative agreements. This client communication provides an update on the proposal and an overview of the Uniform Guidance content and institutional implications.
Huron Education evaluated the guidance against the reforms originally proposed in the federal registrar and summarized the most significant items with implications for grantee institutions (see following table). Huron anticipates further revisions and refinements to the guidance, but that the core elements and impacts of the proposed common circular will remain and be finalized into Title 2 of the Code of Federal Regulations later this year.
The focus on federal accountability and transparency, and reduced administrative burden has increased momentum for potential reforms that may have significant impact on grant recipients. The President's Executive Order in 2009 and a memorandum in 2011 have directed the OMB to evaluate potential reforms to federal grant policies in an effort to increase efficiency, strengthen oversight, and align administrative requirements.
On February 28, 2012, OMB published a notice in the Federal Register regarding reform of federal policies related to cost principles and administrative requirements for grants and cooperative agreements. After considering the comments received in response to this notice, the federal government has developed and released the proposal for the Uniform Guidance.
This proposed guidance is intended to streamline the language from eight existing OMB circulars into one document outlining the structure, scope, and terms of the cost principles and administrative requirements governing federal grants and cooperative agreements for all grant recipient institution types. This consolidation is aimed at eliminating duplicative or nearly duplicative language in order to clarify where policy is substantively different across types of entities, and where it is not.
The most significant changes to the circulars involve the Single Audit and cost principles related to direct and indirect costs. These potential reforms are open for public comment through May 2. To provide a comment on the proposed uniform guidance, access the federal website and submit your comment under docket OMB-2013-0001.