Unreasonable Costs Charged to USAID - Office of Management and Budget Circular A-122

Office of Management and Budget Circular A-122 states that, to be allowable under an award, costs must be reasonable for the performance of the award. A cost is reasonable if, in its nature or amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the costs.

General Recommendations

  • Establish procedures and criteria for determining the reasonableness of costs charged by implementing partners.

Source: AUDIT REPORT NO. F-306-11-003-P JUNE 19, 2011 

The recommendations are derived from audit reports of the Office of the Inspector General. The source refers to the audit report, which is available on this site as part of the Audit Database Project: an educational tool for compliance with USAID regulations.  Please see the disclaimer of this site before using recommendations.

Tags: Financial Management and Budgets

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