How to Record SBIR Indirect Cost Recovery
Applying the negotiated indirect cost rates to direct labor on a Small Business Innovation Research (SBIR) grant to recognize indirect revenue.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Unbilled Accounts Receivable - SBIR | Debit | 12,500.00 | - |
| Indirect Revenue Recovery | Credit | - | 12,500.00 |
💡 Accountant's Note
SBIR grants allow for the recovery of indirect costs. This entry records the earned indirect revenue based on the application of overhead and G&A rates to the direct labor base.
Practitioner & Systems Framework
💻 ERP Architecture
Set up the SBIR project with a specific burdening schedule to reflect the grant-specific indirect rate caps if applicable.
⚠️ Audit Flags
Application of incorrect rates (e.g., commercial rates vs. government-negotiated rates).
📄 Required Documentation
Negotiated Indirect Cost Rate Agreement (NICRA) or the SBIR award budget page.
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