GPC Financial Management & Budgeting 3

Question 1

What is an indirect cost rate in grant budgeting?

Accepted Answer

A negotiated rate used to recover overhead costs associated with grant activities

Answer

An indirect cost rate is a negotiated percentage used to allocate an organization's overhead costs (facilities, administration) proportionally across grants and other activities.

Question 2

What is the de minimis indirect cost rate available under 2 CFR Part 200?

Accepted Answer

10%

Answer

Under 2 CFR Part 200, organizations that have never had a negotiated indirect cost rate may elect to use a de minimis rate of 10% of modified total direct costs (MTDC).

Question 3

What is 'Modified Total Direct Costs' (MTDC) as defined in the Uniform Guidance?

Accepted Answer

Direct costs excluding equipment, capital expenditures, patient care charges, and subcontract amounts over $25,000

Answer

MTDC includes salaries, fringe benefits, supplies, services, and travel, but excludes equipment, capital expenditures, patient care charges, and the portion of subcontracts exceeding $25,000.

Question 4

What is a Negotiated Indirect Cost Rate Agreement (NICRA)?

Accepted Answer

A formal agreement between an organization and its cognizant federal agency establishing indirect cost rates

Answer

A NICRA is a formal, binding agreement between a non-federal entity and its cognizant federal agency that establishes the organization's indirect cost rate(s) for use across all federal grants.

Question 5

What does fiscal accountability fundamentally require of grant recipients?

Accepted Answer

Maintaining adequate internal controls and accurate records of grant expenditures

Answer

Fiscal accountability requires grantees to maintain sound internal controls, accurate records, and proper documentation to ensure grant funds are used appropriately and as intended.

GPC - Grant Professionals Certification Practice Test

GPC - Grant Professionals Certification Practice Test

GPC Financial Management & Budgeting 3