Timekeeping for personnel charges on federally funded projects ensures compensation is

• A. Based on actual effort spent
• B. Based on department average
• C. To ensure compensation is reasonable, allocable, and properly allocated to the grant based on actual effort spent
• D. Not required

Answer: (C)

Timekeeping tied to actual effort ensures federal charges are accurate, fair, and compliant. When compensation is recorded based on the real work performed, the costs charged to a federally funded project are reasonable, allocable to the grant, and properly allocated in proportion to the effort actually spent on that project. This aligns with federal cost principles, which require that charges reflect the true level of effort and be assignable to the specific grant activity they support. A solid timekeeping system tracks who worked on the project and for how long, then applies those amounts to the grant in a way that mirrors that effort, preventing both overstatement and cross-subsidization.

That’s why this approach is the best fit: it ensures the compensation is based on actual effort spent and is properly allocated to the grant, satisfying requirements of reasonableness, allocability, and proper allocation.