25-01-005 - Recommendation 3.3

Direct Northeastern to strengthen its policies, procedures, and internal control processes for ensuring its subawardees appropriately apply either their federally negotiated indirect cost rates or the de minimis rate to NSF awards. These updated procedures could include:
• Requiring personnel responsible for approving invoices to perform a calculation to determine whether the indirect costs invoiced are appropriate based on the direct costs invoiced and the rate identified in the subawardee’s Negotiated Indirect Cost Rate Agreement (or the de minimis rate when the subawardee does not have a federally negotiated rate).
• Developing resources that provide guidance on appropriately applying indirect cost rates to all direct costs that should be included in the Modified Total Direct Cost base, per the subawardee’s negotiated indirect cost rate agreements and federal regulations.
• Developing resources that provide guidance on accurately classifying all costs for accounts included within the Modified Total Direct Cost base and on applying the indirect cost rate to those accounts.