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Indirect Cost Agreement Template for England and Wales

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Key Requirements PROMPT example:

Indirect Cost Agreement

"I need an Indirect Cost Agreement between our research institution and a government funding body, incorporating specific provisions for research grants and quarterly reporting requirements, with the agreement to commence from March 2025."

Document background
The Indirect Cost Agreement serves as a critical framework for organizations needing to establish clear, mutually agreed terms for the treatment of overhead and indirect costs. This document, governed by English and Welsh law, is particularly vital for projects involving government funding, research grants, or complex service arrangements where indirect cost recovery is significant. The agreement provides detailed methodologies for cost calculation, allocation bases, and recovery mechanisms, while ensuring compliance with relevant accounting standards and regulatory requirements. It includes specific provisions for audit rights, reporting obligations, and dispute resolution procedures.
Suggested Sections

1. Parties: Identification and details of the contracting parties

2. Background: Context and purpose of the agreement

3. Definitions: Key terms used throughout the agreement

4. Indirect Cost Calculation Method: Detailed methodology for calculating indirect costs

5. Cost Categories: Specification of included and excluded cost categories

6. Payment Terms: Terms and timing of payments

7. Audit Rights: Rights and procedures for auditing cost calculations

8. Term and Termination: Duration and termination provisions

Optional Sections

1. Public Sector Compliance: Required provisions when agreement involves public sector entities

2. Research Grant Provisions: Specific provisions for research funding and associated requirements

3. International Considerations: Provisions for international cost allocation and cross-border activities

Suggested Schedules

1. Schedule 1 - Cost Allocation Methodology: Detailed breakdown of cost allocation calculations and formulas

2. Schedule 2 - Rate Cards: Agreed rates for different cost categories and their application

3. Schedule 3 - Reporting Templates: Standard formats for cost reporting and documentation

4. Schedule 4 - Audit Procedures: Detailed procedures for conducting audits and compliance reviews

5. Schedule 5 - Change Control Procedure: Process for implementing changes to rates or methodology during the agreement term

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions






































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Relevant Industries
Relevant Teams
Relevant Roles
Industries

Contract Law Act and Common Law: Fundamental principles of contract formation and enforcement under English common law system, including consideration, offer and acceptance

Unfair Contract Terms Act 1977: Legislation regulating unfair terms in contracts, particularly in relation to limitation of liability and reasonableness

Unfair Terms in Consumer Contracts Regulations 1999: Regulations protecting consumers from unfair terms in standard form contracts, if applicable to the agreement

Companies Act 2006: Primary legislation governing company operations in the UK, including financial reporting requirements and statutory obligations

UK GAAP and IFRS: Accounting standards and principles that govern financial reporting and cost allocation methodologies

Corporation Tax Act 2009: Legislation governing the tax treatment of indirect costs and their allocation in business operations

Public Contracts Regulations 2015: Regulations governing public procurement and contracting, relevant if any party is a public sector entity

UK Subsidy Control Regime: Post-Brexit regulations replacing EU State Aid rules, governing public sector support to businesses

UK GDPR and Data Protection Act 2018: Data protection legislation governing the processing and protection of personal data in contractual relationships

Research Council Terms: Specific requirements and conditions set by UK Research Councils for research-related funding and costs

Arbitration Act 1996: Legislative framework for arbitration proceedings in England and Wales, relevant for dispute resolution clauses

Civil Procedure Rules: Rules governing civil litigation in England and Wales, important for dispute resolution provisions

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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