Budgets, Costings & Invoicing

For full details of costing please download the Commercial Research and Consultancy Services Policy.

Clicking a question will scroll down the page to the answer.

Why are overheads charged

How are overheads costed

What are JCUs recommended minimum Daily Charge Out Rates

Where do I find information on different annual salary rates and casual rates

When applying for a grant in what cases are overheads not included

How are the overheads distributed

Can overheads be waived

Can the overhead rate be reduced

I have a project that a client has agreed to fund that has been costed and written on a consultancy basis. How are overheads apportioned from the total amount.

What are oncosts

What happens to the income from consultancies and contract Research

When will an account be opened for my project

Who is responsible for issuing invoices for research grants and contract research and consultancy services

How do I know when an account has been opened

What is FTE

How do I calculate FTE

I would like to include a post graduate student as a research assistant in the grant budget however I am not sure what rate to pay

I was under the impression that we could not charge overheads on research grants from funding bodies on the Australian Competitive Grants list which ACIAR is on

Does the Research Office remove the overheads from a projects budget

Why are overheads charged

The University provides significant infrastructure for the support of research, including access to the University's computing systems; libraries; networked information retrieval facilities, physical accommodation; all risks insurance and professional indemnity insurance; animal and human ethics clearances; safety clearances; financial management and auditing; power, heat and water; cleaning and garbage services and basic telecommunications services.

“Infrastructure” is another common term used to describe these “indirect” or “overhead” costs. The full cost of a project is a combination of “direct” project costs such as salaries, travel, maintenance and equipment etc and infrastructure costs. As a general principle, a contribution towards the cost of research infrastructure or overheads is required for all external funding for research and should be included in the project budget.

How are overheads costed

For commercial research and consultancy services:

  • In the event that a flat fee is agreed with an External Party for a project then the overheads deducted will be 20% of the flat fee. Otherwise a charge of 25% of the salary component (which includes salary on-costs) is applied to the project. The salary costs of all personnel working directly on the project should be included in the salary costing.

  • If you are using a daily (charge-out) rate (as per the Commercial Research and Consultancy Services Policies and Procedures) an overheads component is already included, and will be levied at 20% of the total charged-out salary rate.

For grant applications:

  • Overhead costs are set at 15% of the total direct costs of the project. However, the guidelines for costing the research will, in part, be determined by the granting body.

  • Many funding bodies will specifically exclude infrastructure costs from funding support particularly where the funds for research are provided by a philanthropic foundation or charitable body and/or where the project is assessed by peer review in competition with others.

What are JCUs recommended minimum Daily Charge Out Rates

As of October 2008 the daily charge-out rates are:

Position

Daily Rate

Professor or A/Professor [E/D]

$1350

Senior Lecturer [C]

$1100

Lecturer [B]

$950

Associate Lecturer [A]

$800

Where do I find information on different annual salary rates and casual rates

You need to visit Human Resources. Additionally excel salary spreadsheet tools are available here.

When applying for a grant in what cases are overheads not included

Overhead costs must be included in your grant application unless:

1. The scheme guidelines specifically exclude the support of funding for overheads

2. The funding scheme is listed on the current Australian Competitive Grants [ACG] Register

  • The Federal Government provides a Research Infrastructure Block Grant (RIBG) to each university as a contribution towards infrastructure used by projects that are funded by Australian Competitive Grants (e.g. ARC and NHMRC) and accordingly overheads are not included in the budgets for these schemes. The ACG Register provides a full list of granting bodies and schemes.

3. The funding body is a research foundation or philanthropic or charitable organisation; or where such funding bodies do not specifically allow for overheads and have limited resources, the University will normally exempt their grants from overheads.

4. The funding is provided for the support of a research student.

  • The University will exempt a grant that supports a research student from the overheads requirement, but only if:

i. the research funds are primarily for the support of the student (eg. through payment of a stipend or project costs) and

ii. the work being undertaken contributes directly to the student’s thesis.

In each of cases 2, 3 and 4, the funding body’s guidelines may allow for overheads to be included in a budget. If so, overheads should be charged. For example, ACIAR is an ACG scheme but will normally allow 13% overheads.

NOTE: Overheads should always be charged on contract and commercial research and consultancy services to ensure full cost recovery.

How are the overheads distributed

One third of a project's overheads are returned to your School. Schools differ as to their policies on how those funds are used or distributed. The remaining two thirds are kept centrally, to cover general University overhead costs.

Can overheads be waived

Except for the automatic exclusions noted above for some specific types of research grants, approval for the waiver or reduction of overheads can only be given by the Deputy-Vice-Chancellor (Research & Innovation) on contracts up to $500,000 or by the Director Research Services for contracts up to $50,000.

Applicants are advised to contact the Research Office prior to submitting a proposal to a funding body if they are not clear if overheads should or should not be included, or if a waiver can be sought.

Formal approval of a waiver of overheads, other than for the automatic exclusions listed above, must be obtained from the appropriate delegate and be appended to the Application Cover Sheet when lodging a grant application.

Can the overhead rate be reduced

In some cases grant or tender guidelines may state a maximum overhead that can be applied for. For example ACIAR only allows 13% overheads to be included in proposals. Where the guidelines stipulate a limit on overheads you abide by this. When submitting the Application Cover Sheet to the Research Office you will have ticked the box “[ ] Excluded by Grant Rules” under the question do “Administrative Overheads apply to this project?”

There are many variables at work with negotiations either for "research" or "consultancies". Contracts for "research" or "consultancies" consist of detailed provisions some of which are negotiable. For example if the researcher is able to freely publish then this would be of benefit and therefore a lower (15%) rate might be charged. If on the other hand, the contracting organisation wishes to keep the data to itself (thereby depriving the researcher of the ability to publish or develop the material) then this must be a consultancy with the consequent higher rate of overheads to be charged.

I have a project that a client has agreed to fund that has been costed and written on a consultancy basis. How are overheads apportioned from the total amount.

As the project scope was costed and written on a consultancy basis this means that overheads/oncosts are included in the total project cost. JCU levies the GST exclusive total by 20% to cover overheads. The remainder is what is left to pay salary + oncosts and consumables for the project.

Where the total price is a lump sum (there is no budgetary breakdown) - and it is not unusual with consultancies for a client to offer a lump sum - the price will be treated as if it is for salaries only, i.e. overheads will be levied at 20% of the total sum.

What are oncosts

On-costs are the additional direct costs of employing a person on a research project. These include Leave Loading, Employer Superannuation Contribution, Payroll Tax, Work cover, Long Service and Annual Leave Provision, district allowance. The total of these can amount to over 29% of the direct salary costs (wages based on time spent on project and salary scale). An average rate of 29% is suggested for calculating on costs in grant applications and tender submissions. Note ARC only allow for 28% on costs to be included. For actual on costs for different position types please refer to the on cost information provided by Human Resources.

What happens to the income from consultancies and contract Research

Where the University is satisfied that all direct costs and infrastructure costs have been met and that all conditions of contract are satisfied; then subject to the approval and at the discretion of an Authorised Person, and subject to the conditions applying to distribution of income as set out in (a) to (e) below, the balance of any project income remaining may be distributed:

  1. to the general services fund of the School concerned or to another fund nominated by the Head of School; or

  2. to project staff as a payment into a general services fund for the staff concerned to support research and related activities such as travel or conferences; or

  3. to appropriate project staff as ex-gratia salary payments with normal payroll deductions applying; or

  4. partly to each of the purposes referred to in (i), (ii) and (iii) above.

  1. When the distribution is made in accordance with (i) and (ii) above, some or all salary costs relating to project staff need not be reimbursed from project income so long as the salary is paid from alternative funding sources within the School eg. operating funds. The University believes that the greatest benefit is delivered to the University if the payment is used to support research-related activities. To act as an incentive for this to occur, Schools are given the option of choosing not to recoup all, or part of, the salary costs associated with project staff provided that the salary costs have been covered by other funding sources within the School. Under these circumstances, some or all of the project income derived from the salary component of the budget can be directed to the staff member’s general services fund. This arrangement is designed to be an incentive for staff to undertake Consultancies or Contract Research and to use income earned to support other research-related activities.

  2. When the distribution is made in accordance with (iii) above, all salary (including salary oncosts) directly related to project staff must be recouped by the School from the project income prior to any ex gratia payments being made.

  3. Income credited to a School account must only be used for work-related activities.

  4. Any equipment purchased using the distributed income remains the property of the University.

  5. Authorised Persons may not authorise any ex gratia salary payments to themselves but must seek authorisation from a higher authority.

Note: Authorised Person means as per the Delegations Policy.

When will an account be opened for my project

The FABS - Grants Finance Section will only process account requests when:

  • The contract has been appropriately signed by both parties;

  • An application cover sheet has been completed and processed through Research Services;

  • Ethics approvals have been granted, where necessary; and

  • Approval to open the account has been given by Research Services.

Who is responsible for issuing invoices for research grants and contract research and consultancy services

As long as an account has been created as per the above process, all invoicing will be carried out by JCU’s Financial and Business Services – Grants Finance Section. Just always remember at the earliest opportunity to give the following to Research Services:

  • Approval letter from the granting body and contract (within this it will outline timing and installments for invoice payment i.e. on signing, upon completion or upon delivery of report etc)

  • ACS

  • The proposal provided to the funding body – which might include a budget for the proposal.

The information is entered into a database at the Research Office, checked for ethics approval and if all okay the file is given to Grants Finance with approval to open the account and do the invoicing. If all information is provided then the longest this should take is a week.

How do I know when an account has been opened

FABS - Grants Finance will notify the researcher and finance officer in the school of the account number by email. You can start using the account straight away, even if the invoice hasn’t been processed.

What is FTE

A Full Time Equivalent (FTE) is the equivalent of one person working full time or two people each working half time. FTE does not mean number of employees.

How do I calculate FTE

Assuming you work 7.25hrs/day as per the JCU Union Collective Agreement 2006 (Full-time general Employees) and 260 days of the year, this equates to 1885hrs per year. Based on this information, if you were to spend 13 days on a project this would equate to 0.05FTE (13/260). A simple FT E ca l culator is available.

I would like to include a post graduate student as a research assistant in the grant budget however I am not sure what rate to pay

The level of pay is something that you have to be prepared to pay. Some research assistants may be on HEWL 4 and 5 for example. It will depend on what the person is required to do. For research assistants employed over a longer time period you will need to account for yearly incremental steps until they reach the top of the HEWL level. You can discuss these requirements with Human Resources. You may also want to check classification descriptors for various positions on the Hum a n Resources site as well.

I was under the impression that we could not charge overheads on research grants from funding bodies on the Australian Competitive Grants list which ACIAR is on

Overheads can be included in an Australian Competitive Grant budget if the scheme rules allow us to. ACIAR allows up to 13% to be added to the project costs, to cover indirect costs.

Does the Research Office remove the overheads from a projects budget

No. Grants Finance will remove overheads. 2/3rd will be kept centrally (to cover insurance etc) and 1/3rd will be transferred back to your relevant School (to cover School indirect costs).