How to distinguish Cost Reimbursement (CR) from Fixed Price (FP) subagreements
Cost reimbursement (CR) agreements are paid as costs are incurred and invoiced, typically monthly or quarterly.
Fixed price (FP) agreements have fixed payments based on a milestone payment schedule or the submission of deliverables.
Cost Reimbursement Attributes:
- Sponsor assumes greater risk
- Frequently used by education, institutions, hospitals, and non-profits
- Greater flexibility
Cost Reimbursement Required Documentation:
- Scope of Work
- Budget
- Budget Justification
- Federally Negotiated F&A Rate Agreement (unless F&A is de minimus or 0%)
- Documentation of Fringe Benefits
- New Subrecipient Financial Questionnaire (if sub is new to JHU and not listed on the dashboard)
- Subrecipient Determination Form
Cost Reimbursement 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
Fixed Price Attributes:
- University assume greater risk
- Lower administrative burden
Fixed Price Required Documentation:
- Milestone Payment Schedule (MPS)
- If first payment under MPS is over 20%, provide approval from dept financial/administrative head
- Scope of Work w/ list of deliverables
- New Subrecipient Financial Questionnaire (if sub is new to JHU and not listed on dashboard)
- Subrecipient Determination Form
- Provide approval from federal sponsor to issue FP sub (if applicable)
Fixed Price Payment Schedule Includes:
- Description of specific technical work tasks/deliverables
- Amount paid for each deliverable
- Due date for each deliverable