MATERIALS SUPPLIES The proposal budget should indicate the type

							                            MATERIALS & SUPPLIES

The proposal budget should indicate the type of expendable and non-expendable
materials and supplies needed for the project. An estimated cost should be given
with a more detailed breakdown when the cost is substantial (e.g. over $1,000).
The PI should provide these estimates. If the proposal will be submitted to a
federal agency, office supplies, and postage are not allowable as direct costs on
the budget but are treated as part of the F&A or indirect cost base. (OMB Circular
A-21, Sec F-6 (3) http://www.whitehouse.gov/omb/circulars/a021/a021.html.
Check agency guidelines for the requirements for itemization of materials and
supplies.

Equipment and supplies are separate categories and are often confused by the
PI’s because of the nature of the item. A printer that has a cost of less than a
$5,000 is not classified as equipment but as a non-expendable supply or other
costs. Software is often coded as a supply but is coded as “other expenses” in
our accounting system. Unless agency guidelines prohibit it, use the sub-account
definitions provided by Contract & Grant Accounting at:
http://finsvcs.utep.edu/ContractsandGrants/ProceduresManual/ChapterOne.htm#
Attachment1G-SubAccountDefinitions in budgeting materials and supplies.


Materials and supplies are subject to indirect cost.