Revision Date: December 14, 2018
Responsible Office: URA
PDF Version
Computer Purchases on Federal and Federal Pass-Through Funds
What are Computer Purchases?
- Computing purchases include devices used to acquire, process, analyze, store, and publish data and other information electronically, and includes devices for printing, transmitting, receiving, and/or storing electronic information.
Federal Regulations:
Recent changes in Federal regulations as outlined in 2 CFR 200 have allowed awardees more flexibility to charge computers to sponsored projects as a direct cost. However, this flexibility does not remove our responsibility to be compliant with an award’s terms and conditions. When purchasing computing devices on sponsored awards, it is important to keep the following in mind:
- The expense should be included in your proposal budget and budget justification when possible.
- Verify that the terms and conditions of your award allow for the purchase prior to making it.
- Confirm the computing device is essential to the project.
- Verify the cost of the item is reasonable and you are able to justify why it is reasonable.
- Ensure the cost of the item is properly allocated. For example, if a purchase will be used by two projects 50% of the time, the expense should be split 50/50 between the two projects.
- Confirm the project does not have reasonable access to already existing resources that may achieve the same purpose as the new purchase. Computing devices should not be purchased for reasons of convenience, preference, or to spend down remaining funds.
- If the cost is greater than $5,000, the item is considered capital equipment and applicable Federal rules apply.
The Principal Investigator should consider whether performing the work for the Federal award without the computing device would be difficult and inefficient. A critical measure of this determination is considering whether the anticipated cost of performing the work without the computing device is greater than the combined cost of performing the work plus the cost of acquiring the computing device. Documentation regarding these determinations should be maintained with the purchase request or in the departmental grant file.
If it is determined that a computing device is essential to a Federal award, then it is allocable to that award. The total cost may be allocated to the Federal award, but must be allocated in such a way that it corresponds with the direct benefit to the award. The Principal Investigator must apply a reasonable cost allocation methodology.
The Principal Investigator must make an informed decision which takes into consideration the cost, utility, quality, and value of the computing device to the project.
Special Note:
Any purchases made in the last 60‐90 days of the project undergo increased scrutiny regarding the direct benefit to the award. Computer purchases generally should not be made at the end of the project, but if it is critical to finish the project, the Principal Investigator will need to document the need for the computer, describe its direct benefit to the project, and only charge the amount of the purchase that is proportionate to the direct benefit received by the Federal award.