There has been an ongoing dialogue between Councils and Research Organisations about whether ROs should be required to report on the level of any overspends against directly incurred costs on Council-funded grants.
Councils take the view that it is good financial management to monitor, and be able to report on, the total costs, including any overspends, directly incurred on grant-supported projects. Furthermore, this understanding should, they believe, help improve the full economic costing of future projects and thereby contribute to the goal of improving the long-term sustainability of the UK research base. Councils have also voiced concerns that unless overspends are identified in this way they may feed through into indirect cost rates, contravening TRAC.
Councils continue to regard full cost reporting as a desirable objective, and encourage Research Organisations to implement steps to enable this to happen wherever practicable. However, recognising that this will not always be straightforward, and given the need, particularly acute at the moment, to reduce the cost of administering research, right across the sector, the Councils have decided not to enforce this as a condition of funding for the time being.
In the meantime, funding assurance visits will continue to recommend full cost reporting as best practice and to encourage its introduction where appropriate.
Further information is available here.