Stewardship and Compliance
for Stanford PIs



Some of the information summarized on this page is derived from the Office of Management and Budget web site.

The Office of Management and Budget (OMB) is one of the agencies of the Executive Branch of the U.S. Government. OMB's predominant mission is to assist the President in overseeing the preparation of the Federal budget and to supervise its administration in Executive Branch agencies. OMB evaluates the effectiveness of agency programs, policies, and procedures, assesses competing funding demands among agencies, and sets funding priorities.

Working cooperatively with Federal agencies and non-Federal parties, OMB establishes government-wide grants management policies and guidelines through circulars and common rules. These policies are adopted by each grantmaking agency and inserted into their Federal regulations.

One of the OMB Circulars, designated A-21, is titled Principles for Determining Costs Applicable to Grants, Contracts, and Other Agreements with Educational Institutions. The cost principles in A-21 provide the general accounting "rules" for colleges and universities. These principles define those costs that are allowable and allocable to the Federal Government.

Other OMB Circulars which are frequently referenced in the administration of sponsored projects at academic institutions are:

  • OMB Circular A-110
    Grants and Agreements with Institutions of Higher Education, Hospitals and other Non-Profit Organizations
    This Circular sets forth standards for the pre-award and post-award administration of grants to and agreements with institutions of higher education. It includes provisions related to property, procurement standards, reports and records, among others.
  • OMB Circular A-133
    Audits of Institutions of Higher Education and Other Non-Profit Institions
    This Circular sets forth standards for obtaining consistency and uniformity among Federal agencies for the audit of non-profit organizations expending Federal awards. A-133 requires a single, annual compliance audit of educational institutions receiving federal funding.

The provisions of these circulars are applicable to all federal agencies which award federal dollars. Stanford has translated these cost principles into its University policies relating to financial aspects of sponsored projects administration.

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