Why Nonprofits Need To Know About NICRA!

Send us Fan MailIn this Nonprofit Power Week episode, Hatsy Cutshall from Your Part-Time Controller (YPTC) talks about NICRA, which stands for Negotiated Indirect Cost Rate Agreement, in the context of nonprofit organizations. Here are the key points you will want to pay attention to as you watch this valuable conversation: NICRA stands for Negotiated Indirect Cost Rate Agreement. It is a federal U.S. concept related to helping nonprofits document their indirect costs and how they are allocated. Indirect costs are crucial for organizations to understand because they help determine which programs are covering their costs and which are not, as it’s essential to know if additional resources are needed to cover shortfalls. Costs associated with running programs can vary depending on the geographic location. It's important to involve finance and accounting departments, and the Board, from the beginning, especially when applying for federal funding. Often, departments within organizations fail to include indirect costs in their budgets, which can lead to financial challenges later. You can negotiate with government agencies when it comes to indirect cost rates. Agencies have program officers or grants officers who are willing to help and answer questions. They prefer organizations to reach out directly for clarification rather than making incorrect assumptions. Building relationships with agency representatives is crucial. Start developing a rapport with them as soon as you receive funding, as these relationships can make the negotiation process smoother. NICRA is not a one-time effort. Organizations must regularly review and update their rates to ensure they reflect their current financial situations and program needs, and this conversation emphasizes the value of open communication with agency representatives and the benefits of building relationships throughout the nonprofit sector. Watch on video: https://bit.ly/3PktF5LFind us Live daily on YouTube!Find us  Live daily on LinkedIn!Find us Live daily on X: @Nonprofit_ShowOur national co-hosts and amazing guests discuss management, money and missions of nonprofits!  12:30pm ET   11:30am CT  10:30am MT  9:30am PTSend us your ideas for Show Guests or Topics: [email protected] us on the web:The Nonprofit Show