[Code of Federal Regulations]

[Title 32, Volume 1]

[Revised as of July 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 32CFR37.625]



[Page 239]

 

                       TITLE 32--NATIONAL DEFENSE

 

              CHAPTER I--OFFICE OF THE SECRETARY OF DEFENSE

 

PART 37_TECHNOLOGY INVESTMENT AGREEMENTS--Table of Contents

 

 Subpart F_Award Terms Affecting Participants' Financial, Property, and 

                           Purchasing Systems

 

Sec.  37.625  What cost principles or standards do I require for 

for-profit participants?



    (a) So as not to require any firm to needlessly change its cost-

accounting system, your expenditure-based TIAs are to apply the 

Government cost principles in 48 CFR parts 31 and 231 to for-profit 

participants that currently perform under expenditure-based Federal 

procurement contracts or assistance awards (other than TIAs) and 

therefore have existing systems for identifying allowable costs under 

those principles. If there are programmatic or business reasons to do 

otherwise, you may grant an exception from this requirement and use 

alternative standards as long as the alternative satisfies the 

conditions described in paragraph (b) of this section; if you do so, you 

must document the reasons in your award file.

    (b) For other for-profit participants, you may establish alternative 

standards in the agreement as long as that alternative provides, as a 

minimum, that Federal funds and funds counted as recipients' cost 

sharing will be used only for costs that:

    (1) A reasonable and prudent person would incur in carrying out the 

research project contemplated by the agreement. Generally, elements of 

cost that appropriately are charged are those identified with research 

and development activities under the Generally Accepted Accounting 

Principles (see Statement of Financial Accounting Standards Number 2, 

``Accounting for Research and Development Costs,'' October 1974 \1\). 

Moreover, costs must be allocated to DoD and other projects in 

accordance with the relative benefits the projects receive. Costs 

charged to DoD projects must be given consistent treatment with costs 

allocated to the participants' other research and development activities 

(e.g., activities supported by the participants themselves or by non-

Federal sponsors).

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    \1\ Copies may be obtained from the Financial Accounting Standards 

Board (FASB), 401 Merritt 7, P.O. Box 5116, Norwalk, CT 06856-5116. 

Information about ordering also may be found at the Internet site http:/

/www.fasb.org or by telephoning the FASB at (800) 748-0659.

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    (2) Are consistent with the purposes stated in the governing 

Congressional authorizations and appropriations. You are responsible for 

ensuring that provisions in the award document address any requirements 

that result from authorizations and appropriations.