How may program income be used?
Institutional Audit Report:
Submit Underwrite Request:
What: Occasionally an account in the sponsored project fund group will incur income from a source not connected to the sponsoring agency. Program income includes, but is not limited to, income from fees for services performed, the use or rental of real or personal property acquired under federally-funded projects, the sale of commodities or items fabricated under an award, license fees and royalties on patents and copyrights, and interest on loans made with award funds. NOTE: While other program income is reportable, income from license fees and royalties for copyrighted material, patents, patent applications, trademarks and inventions is not reportable.
Why: Tracking program income on federal and federal pass-through awards is required under the provisions of A-110, "Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals and Other non-Profit Organizations". Program income generated as a result of project activities is also subject to review by the Indiana State Board of Accounts in connection to the annual Indiana University A-133 audit and as required by Part 3, Section J of the A-133 Compliance Supplement.
How: If program income is anticipated at the time of proposal submission, the information must be included in the proposal. Generally, program income on federal awards may be used in one of three methods:
- Deducted from project expenditures to determine the net allowable federal share of costs
- Added to the project budget to further eligible project or program objectives
- Used to meet matching requirements.
Program income is reportable. Responding to the increased emphasis on this issue, IU issued Important Notice 00-6 (Program Income) to provide detailed information regarding the tracking of such income. In order to delineate program income accounts, such funds will be set up in the 55 account series, sharing the same last 5 digits as the main grant.
The federal awarding agency regulations or the terms and conditions of the award should be reviewed for any specific language regarding program income. Unless provided other by the awarding agency, recipients shall have no obligation to the Federal Government with respect to program income earned after the end of the project period.
- NIH: Treatment of program income will be stated in the Notice of Grant Award.