Using Subcontract Object Codes

Given that one of the main purposes of the chart of accounts is to enable the University to easily budget, capture, sort, and report financial data in the appropriate categories, both for internal financial management, three object codes are available for charging subcontract expenses at Harvard.

Which object codes are used depends on the sponsor’s terms and conditions. Per the University’s rate agreement with the Department of Health and Human Services, indirect costs are charged on the first $25,000 of each subcontract in a federal proposal. However, some non-federal sponsors, like the Gates Foundation, allow us to charge indirect costs on more than the first $25,000.

Object code When to use it
8190 For the first $25,000 of subcontract expenses that takes overhead
8191 Used for subcontract expenses that exceeds the threshold for assessing overhead
8192 For expenses over $25,000 that takes overhead

Example 1 (can only charge overhead on first $25,000, as with a federal award):
We have an award funded by the National Institutes of Health in which we issue a subcontract to MIT in the amount of $100,000. The award is fully spent. The first $25,000 in expenses should be charged to 8190 while $75,000 should be charged to 8191.

Example 2 (can charge overhead on first $100,000, as with the Gates Foundation):
We have an award funded by the Gates Foundation in which we issue a subcontract to MIT in the amount of $150,000. The award is fully spent. The first $25,000 in expenses should be charged to 8190 while $75,000 should be charged to 8192 to bring to a total of $100,000. The remaining $50,000 should be charged to 8191.