Allowable Costs and Cost Categories

The grant agreement or contract outlines the terms and conditions for reimbursement. You will receive a copy during the award acceptance process. Contact your Grant Accountant with any questions about financial management. Changes to the approved budget may require sponsor approval. Without this approval, the sponsor may not reimburse unapproved expenses. In the event of an audit, if expenses are deemed unallowable, the School/College/Division may be required to return funds. Your Grant Accountant will assist with any audit or collection issues.

Allowable Costs must:

• Be necessary: Essential for completing the project scope, especially toward the end of the project period.
• Be reasonable: Reflect prudent judgment and align with UWM policies.
• Be allocable: Chargeable to the award based on the benefit received and consistent with UWM’s operational needs.
• Conform to award limitations: Review award documents for specific cost restrictions.
• Be consistent with UWM policies: All project costs must comply with Uniform Guidance (2 CFR 200) for both federal and non-federal projects.
• Not be overhead: Costs like telephone charges, office supplies, or administrative support are unallowable as direct charges.
• Not count as cost-share on another project: Cost-share must come from eligible University or third-party funds.

Unallowable Costs (per 2 CFR 200.402-410) include:

• Advertising (with exceptions, 2 CFR 200.421)
• Alcohol (2 CFR 200.423)
• Alumni Activities (2 CFR 200.424)
• Commencement Costs (2 CFR 200.429)
• Entertainment (2 CFR 200.438)
• Fundraising (2 CFR 200.442)

Unallowable costs must be transferred off the award by the School/College/Division, with funding from a compliant source. In some cases, a refund to the sponsor may be required. It is the Principal Investigator’s responsibility to ensure expenses are allowable. Your Grant Accountant can assist with any questions.