Why Is a Budget Important?
- Sponsor will expect to see how you plan to spend what you request from them.
- Sponsor usually requests an itemized budget and budget narrative/justification.
- Budget narrative/justification justifies the costs and shows how costs have been calculated.
- Reminder: there may be some changes in actual post-award spending; some of these may require prior approval.
- Budget demonstrates you truly understand the scope of work to be undertaken.
- Should be a financial blueprint of the project:
Budget should support all activities in the project narrative/timeline, and vice versa.
Someone reading only your budget should be able to tell what your project is about without then having to also read the project narrative.
Begin drafting budget as you design project/draft proposal.
Always keep in mind: All costs must be: Allowable, Allocable, and Reasonable (2 CFR (Code of Federal Regulations), Section 200, or “Uniform Guidance”)
- Allowable: Must not be prohibited by: Sponsored agreement, the institution’s policies, Federal Cost Principles (2 CFR §200.400, “Uniform Guidance”)
- Allocable: Costs must be incurred solely to support or advance the work of a specific sponsored research award—and only during the project period.
- Reasonable: Costs must be able to withstand public scrutiny, i.e., those not involved in project would agree it is reasonable and appropriate.