# 2 C.F.R. § 200.403 (2026): Factors affecting allowability of costs

> Federal · Regulations · In force

URL: https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_403

## Section

- **Citation:** 2 C.F.R. § 200.403 (2026)
- **Heading:** Factors affecting allowability of costs
- **Jurisdiction:** Federal
- **Kind:** Regulations
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** Title 2 CFR: Federal Financial Assistance / Chapter II: OFFICE OF MANAGEMENT AND BUDGET GUIDANCE / Part 200: UNIFORM ADMINISTRATIVE REQUIREMENTS, COST PRINCIPLES, AND AUDIT REQUIREMENTS FOR FEDERAL AWARDS / Subpart E: Cost Principles / § 200.403: § 200.403   Factors affecting allowability of costs.

## Text

Except where otherwise authorized by statute, costs must meet the following criteria to be allowable under Federal awards:
(a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles.
(b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items.
(c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the recipient or subrecipient.
(d) Be accorded consistent treatment. For example, a cost must not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost.
(e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for State and local governments and Indian Tribes only, as otherwise provided for in this part.
(f) Not be included as a cost or used to meet cost sharing requirements of any other federally-financed program in either the current or a prior period. See § 200.306(b).
(g) Be adequately documented. See §§ 200.300 through 200.309.
(h) Administrative closeout costs may be incurred until the due date of the final report(s). If incurred, these costs must be liquidated prior to the due date of the final report(s) and charged to the final budget period of the award unless otherwise specified by the Federal agency. All other costs must be incurred during the approved budget period. At its discretion, the Federal agency is authorized to waive prior written approvals to carry forward unobligated balances to subsequent budget periods. See § 200.308(g)(3).

## Nearby sections

- [2 C.F.R. § 200.400 (2026) § 200.400   Policy guide.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_400.md)
- [2 C.F.R. § 200.401 (2026) § 200.401   Application.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_401.md)
- [2 C.F.R. § 200.402 (2026) § 200.402   Composition of costs.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_402.md)
- [2 C.F.R. § 200.403 (2026) § 200.403   Factors affecting allowability of costs.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_403.md)
- [2 C.F.R. § 200.404 (2026) § 200.404   Reasonable costs.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_404.md)
- [2 C.F.R. § 200.405 (2026) § 200.405   Allocable costs.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_405.md)
- [2 C.F.R. § 200.406 (2026) § 200.406   Applicable credits.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_406.md)
- [2 C.F.R. § 200.407 (2026) § 200.407   Prior written approval (prior approval).](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_407.md)
- [2 C.F.R. § 200.408 (2026) § 200.408   Limitation on allowance of costs.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_408.md)
- [2 C.F.R. § 200.409 (2026) § 200.409   Special considerations.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_409.md)
- [2 C.F.R. § 200.410 (2026) § 200.410   Collection of unallowable costs.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_410.md)
- [2 C.F.R. § 200.411 (2026) § 200.411   Adjustment of previously negotiated indirect cost rates containing unallowable costs.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_411.md)
- [2 C.F.R. § 200.412 (2026) § 200.412   Classification of costs.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_412.md)
- [2 C.F.R. § 200.413 (2026) § 200.413   Direct costs.](https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_413.md)

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/CFR_T2_P200_S200_403. Check the current official text before relying on it. Not legal advice.