Notes to SEFA
The accompanying schedule of expenditures of federal awards (the schedule) is prepared in accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). The purpose of the schedule is to present information relating to expenditures of the Smithsonian Institution (Smithsonian) under programs of the federal government for the year ended September 30, 2025. The schedule presents only a selected portion of the operations of Smithsonian, and is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the Smithsonian. The schedule does not include expenditures funded by the Smithsonian’s federal appropriation, which is not subject to the Uniform Guidance.
The accompanying schedule of expenditures of federal awards is prepared using the accrual method of accounting. Such expenditures are recognized as incurred using the cost accounting principles contained in the Uniform Guidance. Under the guidance, certain types of expenditures are not allowable or are limited as to reimbursement. Expenditures include costs that can be identified with specific projects (e.g., salaries and fringe benefits, travel, and materials) plus allocations of the applicable indirect costs (e.g., grant and contract administration, general administration, operating overhead, material burden, and engineering services). Negative amounts on the schedule of expenditures of federal awards, if any, represents adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.
The indirect cost rates applied are negotiated percentages of direct expenses. The indirect cost rate allocation bases exclude capital expenditures and other items. Indirect cost rates applied to awards for the year ended September 30, 2025 were negotiated with the cognizant agency, the National Aeronautics and Space Administration. Because the Smithsonian has received a negotiated indirect cost rate, it is not eligible for and has not elected to use the de minimus indirect cost rate under the Uniform Guidance.