How to distinguish Cost Reimbursement (CR) from Fixed Price (FP) subagreements
In Review
Cost reimbursement (CR) agreements are paid as costs are incurred and invoiced, typically monthly or quarterly
Cost Reimbursement Required Documentation:
- Scope of Work
- Budget Justification
- Federally Negotiated F&A Rate Agreement (unless F&A is de minimus or 0%)
- Documentation of Fringe Benefits
Budget Includes:
- PI effort, fringe benefits (rate or directly charged), salary, (Not to exceed salary cap if sponsor is Federal)
- Direct Costs – line items for each
- Indirect costs (F&A)
- Equipment Cost and description (if applicable
Sponsor assumes greater risk
Frequently used by educations institutions, hospitals and non-profits.
Greater flexibility
Fixed Price Required Documentation: Milestone Payment Schedule (includes)
- Scope of Work
- Specific deliverables
- Amount paid for each deliverable
- Due date for each deliverable
- *Special approval from federal sponsors
University assume greater risk
Lower administrative burden
Fixed price (FP) agreements have fixed payments based on a milestone payment schedule or the submission of deliverables.
