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FAQ's

1.      How do I find the costs for my project?

2.      What are Full Economic Costs (fEC)?

3.      What costs will be eligible under fEC?

4.      What is the distinction between Directly Incurred and Directly Allocated costs?

5.      Can research organisations still apply for pooled staff effort such as technicians or secretaries? Are they DI or DA?

6.      Is fEC a University of St Andrews initiative?

7.      Do I need to get a costing for all fEC applications via the research grants office?

8.      Do I need to justify the estates and indirect costs in my Case for Support?

9.     What is sustainability?

10. How can the Institution achieve Sustainability?

11. What is the Transparency Review (TRAC)?

12. Why is a TRAC survey of staff time required?

13. How often will I be asked to provide this information?

14. If the usage of a facility can be accurately attributed to specific projects, could it be a directly incurred cost rather than a directly allocated cost?

15. Are there any exceptions to the Research Council 80% FEC regime - e.g. for equipment?

16. Can the costs of recruitment and dissemination be included?

17. What do we get out of fec?

18. Will charities and others pay FEC at the same percentage as Research Councils?

19. Will Research Council peer review discriminate against higher cost bids under FEC?

20. Is academic time eligible for support?

21. Will academics have to fill in timesheets or record phone calls?

22. Are fellowships and postgraduate research students included within fEC?

23. How does FEC work for research that takes place entirely out-with the University?

24. What happens with existing grants that are due to carry on running some time into the future?

25. Should I increase my costs to compensate for the 20% fec shortfall?

26. What is an FTE?

27. What is dipstick testing?

28. Where can I find more information about fEC and TRAC?

29. Do the Research Councils return applications?

 

Q. How do I find the costs for my project?

 

A. PI/Co-I time, staff salaries, estates, infrastructure, indirect and facility costs are provided by the Research Funding Office.

Procurement and school administrators can assist with estimates for equipment, consumables and delivery costs.

The Travel Service can quote for flights, car hire, accommodation and various other travel requirements.

Q. What are Full Economic Costs (fEC)?

 

A. Full Economic Costs represent the total that the University needs to fund its research activities (and other activities) in a sustainable manner. Typically a Charity will pay for eligible direct costs, Research Councils will pay for a % of eligible direct and indirect costs and Industry should pay a minimum of the 100% full economic costs. Across the HEI sector there is a large deficit in the financing of infrastructure with Estate portfolios not being managed in a sustainable manner. The Full Economic Cost of an activity includes direct (Incurred) and indirect (Allocated) costs, space/estates charges including depreciation, and adequate recurring investment in infrastructure.

Q. What costs will be eligible under fEC?

 

A. All costs that are required to undertake the project/activity will be eligible under fEC. Examples of costs not currently accounted for that will be eligible under fEC include: PI salary costs, estate costs (inc infrastructure adjustment), facility charges and advertising costs.  Some shared costs may be already included in the estates or indirect costs such as electricity, rent, rates and clerical salaries so do to need to be added separately.

Q. What is the distinction between Directly Incurred and Directly Allocated costs?

 

A. Directly Incurred costs (DI) are costs that are explicitly identifiable as arising from the conduct of the research. They are charged on the basis of the cash amount spent and are verifiable and auditable from the accounting records. Directly Allocated costs (DA) are shared costs based on estimates, and do not represent actual costs on a project-by-project basis.

Q. Can research organisations still apply for pooled staff effort such as technicians or secretaries? Are they DI or DA?

 

A. Yes. Pooled staff effort is usually taken to include staff that are specific to a project even though only a proportion of their time is allocated to it, plus support staff in the category `departmental technical and administrative services'.

Where staff are specific to a project, they can be DI if their costs can be named and charged directly to the project, underpinned by an auditable record e.g. time sheets; otherwise they will be DA. Departmental technical and administrative services should be listed under Other Directly Allocated, Project Specific costs.

Q. Is fEC a University of St Andrews initiative?

 

A. No. fEC is a Government (via the OST and Research Councils) directive to all UK institutions.

Q. Do I need to get a costing for all fEC applications via the research grants office?

 

A. Yes, where any salary costs, PI, Co-I time, estates and indirect costs are required but not necessarily when it is a small travel or conference application.

Q. Do I need to justify the estates and indirect costs in my Case for Support?

 

A. No. The estates and indirect costs are calculated using TRAC methodology, and are audited annually; the Research Councils have accepted this and do not require further justification. However, you will be required to justify everything else, especially any 'other directly allocated costs' such as facilities and maintenance charges.  This is an area which the Research Councils state is currently not being satisfied; costs they say, which are not fully justified will not be granted (excluding estates and indirect as previously mentioned).

Q. What is sustainability?

 

A. The definition of sustainability in terms of fEC is; 'An institution is being managed on a sustainable basis, if taking one year with another, it is recovering its full economic costs across its activities as a whole. It is also investing in its infrastructure (physical, human and intellectual) at a rate adequate to maintain its future productive capacity, appropriate to the needs of its strategic plan and students, sponsors and other customer requirements.'

Q. How can the Institution achieve Sustainability?

 

A. Institutions are required to do five things to manage their research on a sustainable basis: i. Establish and recognise the full economic costs of research. ii. Manage the research activity strategically.
iii. Secure better prices for research. iv. Improve project management and cost recovery. v. Invest in the research infrastructure.

Q. What is the Transparency Review (TRAC)?

 

A. The Transparency Review takes the total costs for the University (as reported by School and Department in the annual accounts) and represents them, showing the costs for Teaching, Research and Other.

Q. Why is a TRAC survey of staff time required?

 

A. In order to calculate the split for teaching, research and other activities it is necessary to collect data to show how staff utilise their time in these areas. The numbers calculated from TRAC are used to provide the University's Estates and Indirect fEC rates, therefore it is critical that there is a high, accurate response to the time allocation surveys.

Q. How often will I be asked to provide this information?

 

A. It is a rolling data collection programme, this will mean each and every School completing forms once every three years provided a 75% return is achieved.

Q. If the usage of a facility can be accurately attributed to specific projects, could it be a directly incurred cost rather than a directly allocated cost?

 

A. It could be directly incurred if you can identify usage by each project and have a means of charging costs based on actual usage. The records must be auditable. The alternative approach is to allocate costs to projects based on a charge-out rate, in which case the figures are estimates and should be shown as `Other Directly Allocated' costs.

Q. Are there any exceptions to the Research Council 80% FEC regime - e.g. for equipment?

 

A. Yes. Student fees and maintenance will be awarded at 100%. Cumulative equipment costs over £50k will also be awarded at 100% fEC.

Q. Can the costs of recruitment and dissemination be included?

 

A. Yes, In general recruitment costs can be included in DI provided they occur after the date on the award letter, however you should always check within the individual terms and conditions for each funding call.

Q. What do we get out of fec?

 

A. More money! The transition to a Full Economic Costing methodology will increase the amount of funding received by HEIs. With the same volume of research, by an amount that is substantially larger than the costs being incurred for implementation. Across the sector the extra public funding being provided is £200 million every year from 2007-08 (increasing from £120 million every year from 2005-06). In addition, Government departments have been instructed generally to pay 100% of full economic costs for the research they commission from HEI's; and the higher levels of funding being provided by the Research Councils will raise the benchmark for other funding bodies. Funding Councils have also been allocated increased resources to raise QR block grants very significantly (£239 million more for England in 2007-08 than the 2005-06 level, which itself represents a significant increase on previous years).

Q. Will charities and others pay FEC at the same percentage as Research Councils?

 

A. FEC is about 'costing' not 'pricing', and clearly includes principal investigator time as well as estates and indirect costs. Charities may choose to accept TRAC/fEC as a methodology while preferring not to fund certain costs.  Government departments (not the NHS) should generally pay 100% of FEC, Industrial and overseas bodies should be paying >100% FEC.

Q. Will Research Council peer review discriminate against higher cost bids under FEC?

 

A. No. Noticeably high costs are queried prior to peer review. Research Councils are committed to training referees and panels to judge bids correctly by concentrating on scientific excellence and whether the resources (number of RAs, equipment etc) are appropriate for the project, rather than focusing on cash costs.  If after peer review the project is to be awarded but the costs appear high the Research Council may request revised costs but will generally still fund the project.

Q. Is academic time eligible for support?

 

A. Yes. The time that Principal and Co-Investigators spend on projects is clearly a cost to the HEI, so Research Councils will take account of it in their calculations. Academics need to decide how many hours per week they think they realistically will spend on the project; RFO staff can calculate the rest.

Q. Will academics have to fill in timesheets or record phone calls?

 

A. No. However the Research Councils will not pay over 100% of your time across projects.

Q. Are fellowships and postgraduate research students included within fEC?

 

A. Fellowships will be included, attracting indirect costs on the same basis as other projects. Postgraduate research students are not included so do not incur estates and indirect costs.

Q. How does FEC work for research that takes place entirely out-with the University?

 

A. Where a Research Organisation receives a grant that is conducted out with the University, indirect costs should be included, but estates charges may be waived with Head of School approval. If the work takes place at another institution then their rates should be applied.  There should be no reduction in costs for temporary or short-term absence.

Q. What happens with existing grants that are due to carry on running some time into the future?

 

A. There will be no change to existing grants. All pre-fEC grants will be allowed to run their course.  Extension may now include fec costs and a separate account set up to manage these.

Q. Should I increase my costs to compensate for the 20% fec shortfall?

 

A. No. The funding body will have an idea of what the project should cost and will be able to recognise if costs have been overly inflated.  As all costs will require an audit trail only the true anticipated cost of the project should be applied for.  Research Councils require 100% of the costs to be charged to the project to ensure that this practice has not been adopted.

Q. What is an FTE?

 

A. FTE = Full Time Equivalent. (An FTE year = 44 weeks = 220 days @ 7.5 hours per day = 1650 hours) Where a full-time staff member working a full year counts as 1 FTE and a full-time member of staff working for 50% of the time over a full year counts as 0.5 FTE.

Q. What is dipstick testing?

 

A. This is a term used by the Research Councils to describe the spot checks they will carry out on their visits to each institution. These checks will confirm that all Directly Incurred and Directly Allocated costs being charged to the grant are fully auditable, justifiable and there has been no double costing. It is therefore important that any costs applied to the grant can be proven.

Q. Where can I find more information about fEC and TRAC?

 

For a more in depth description of FEC please see the Joint Costing and Pricing Steering Group web site www.jcpsg.ac.uk

Q. Do the Research Councils return applications?

 

A. Yes, we have had recent returns for CV's longer than the requested two pages, incomplete justification of resources,  Visiting Fellows not entered correctly, extra attachments not required or missing attachments and information not in the correct part of the application.  We strongly suggest keeping to the terms and conditions.

Contact

Finance Department

The Gateway
North Haugh
St Andrews
Fife
KY16 9RJ
Scotland, United Kingdom

Tel: 01334 46 2513

See also

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