COST SHARE MANUAL

Version 1, March, 2014

Introduction ....................................................................................................................................................2
Objective.........................................................................................................................................................2
Scope ..............................................................................................................................................................2
...........................................................3
What Is Cost Share? ........................................................................................................................................3
Table 1. Cost Share Criteria .......................................................................................................................3
Cost Share Is a Contractual Commitment ......................................................................................................4
Sources of Cost Share .....................................................................................................................................5
Sources of Cash Cost Share ............................................................................................................................5
Sources of In-Kind Cost Share .........................................................................................................................5
What Is Not Cost Share...................................................................................................................................6
Leveraging vs. Cost Share ...............................................................................................................................7
........................................................................................7
Table 2. Cost Share in the Program Life Cycle ..........................................................................................7
Pre-Proposal Decisions ...................................................................................................................................8
Proposal Development and Cost Share Strategy............................................................................................8
Cost Share Budget and Budget Narrative .......................................................................................................9
Project Work Plan ...........................................................................................................................................9
Cost Share Tracking ......................................................................................................................................10
Cost Share Documentation and Valuation ...................................................................................................10
Table 3. Cost Share Documentation and Valuation ................................................................................12
Roles and Responsibilities ............................................................................................................................15
Recording Cost Share....................................................................................................................................15
Retaining Cost Share Documentation ..........................................................................................................16
Reporting Cost Share ....................................................................................................................................16
Renegotiating With the Donor .....................................................................................................................16
Cost Share Regulations .................................................................................................................................17
Appendix A: Cost Share vs. Leveraging ...........................................................................................................20
Appendix B: Cost Share Planning Worksheet .................................................................................................21
Appendix C. Cost Share Certification ..............................................................................................................22
Appendix D: Cost Share Report .......................................................................................................................24
Appendix E: Glossary of Cost Share Terms .....................................................................................................26

Cost share refers to the resources a recipient contributes to the total cost of an agreement. Cost
share becomes a condition of an award when it is part of the approved award budget.
Counterparts growing portfolio includes a large commitment in cost sharing. Counterpart has used
its presence in country and its relationships with local organizations to mobilize additional financial
resources to meet its cost share obligations.
This document will guide and provide critical tools to enable the Projects and program teams to
meet cost share requirements.

The objective of this document is to provide guidance to Counterparts Project Directors, Chiefs of
Party (COPs), New Business Development (NBD), program management, Finance, and Grants,
Contracts & Compliance (GC&C) teams regarding cost share. In this document, you will learn:
1. The definition and most common sources of cost share
2. How to manage, document and determine the value of cost share
3. Who is responsible for managing, documenting and determining the value of cost share
You will also learn why following the eight steps below will make it easier for you to meet your cost
share commitment.

1. Record cost share when it happens!

2. Dont delay securing cost share obligations until the end of the project.
3. Do include cost share activities in the projects work plan.
4. During the proposal phase, develop a cost share strategy that is conservative and
realistic.
5. Ensure there is language in any sub-award agreement that explicitly states cost share,
reporting and supporting documentation requirements, and details allowable cost
share (2 CFR 215.2) and other relevant cost share information.
6. Seek AO/AOR approval if you will acquire cost share from sources that are not
outlined in your projects budget or agreement.
7. Ensure cost share complies with U.S. government standards, requirements, and cost
principles for allowability.
8. If in doubt, ask! GC&C and Finance are available and willing to answer your
questions.

HQ and Field Program teams and New Business Development teams should use this document as
a resource to establish a clear and realistic cost share strategy, ensure partners and sub-grantees
understand their cost share commitments, and to incorporate cost share in the proposal budget
and budget narrative.

HQ and Field Program teams should use the guidelines as a resource for managing and reporting
cost share commitments. It does not replace our agreements and contractual requirements, donor
rules and regulations, and cost principles.
This document shall be revised and updated periodically to reflect changes in rules, regulations
and cost principles as well as changes in Counterpart processes.

Cost share is the portion of project or program costs not borne by the U.S. federal government1
and refers to the resources a recipient contributes to the total cost of an agreement. Cost share
increases the coverage and effectiveness of the U.S. federal governments limited budget; and
sharing in project costs provides a sense of ownership and partnership in meeting project costs. It
underscores Counterparts mission to build the capacity of our local partners, and it can expand the
reach of a program and help achieve program objectives. Although not always required by donors,
it is often requested to demonstrate the involvement and commitment of the prime recipient, subgrantees, beneficiaries and other parties in program ownership and sustainability. Due to financial
implications, cost share considerations begin at the pre-proposal (capture) stage and must be
considered in the bid decision. Cost share sections of the proposal must be carefully planned,
presented with sufficient details in the budget and the budget narrative. Once incorporated into an
award, cost share becomes a contractual obligation.

Only contributions that meet all of the following criteria can be accepted as cost share:

Table 1. Cost Share Criteria

1. Verifiable from Counterpart's records
2. Not included as contributions for any other U.S. federally assisted project or program
3. Necessary and reasonable for proper and efficient accomplishment of project or program
objectives
4. Allowable under the applicable cost principles
5. Not paid by the U.S. federal government under another award, except where authorized
by federal statute to be used for cost sharing or matching
6. Provided for in the approved agreement budget. For USAID awards, if cost share is
claimed from sub-recipients, that fact must be clear in the project proposal and budget, or
the Agreement Officer must provide written approval during implementation
7. Conform to other applicable provisions in 22 CFR 226.23.
8. Cost share funds and/or in-kind contributions must to be expended and/or contributed
within the award effective dates

See 2 CFR 215.2

It is important to note that cost share cannot come from U.S. federal sources regardless of the
purchaser. If an item was originally purchased with U.S. government (USG) funds that designation
never expires regardless of how many times ownership changes. According to the cost principles
that apply to Counterpart2, to be allowable under an award, costs can be counted only once. A cost
must not be included for any other U.S. federally financed program in any period. For example, a
grantee that receives a non-USG award and uses it as cost share or match for a USG-funded
program through another firm cannot use the same award as cost share for a Counterpart
program. Likewise, if it uses the award as cost share for one Counterpart award, it cannot use it
again for another Counterpart award.

U.S. federal donors view cost share as an important element of their relationship with the recipient.
If USAID makes a determination to require cost sharing in a competitive award, it is stated in the
announcement and is included in the cost effectiveness evaluation criterion. When Counterpart
signs an award with the U.S. federal government that includes cost share, the organization is
contractually obligated to provide the cost share and must do so in order to remain compliant with
the terms and conditions of the agreement. This is true even if the entire cost share is projected to
come from third-party sources, such as sub-grantees.
As a result of the contractual commitment of cost share, the following implications must be
considered:

Our donor will monitor cost sharing performance

o

The Agreement Officers Representative (AOR) is responsible for monitoring our

financial reports that must include cost share reporting to ensure that we are making
progress toward meeting the required cost sharing

If we are not making adequate progress, the AOR must bring this to the attention of
the Agreement Officer (AO), who must then initiate discussions to resolve the issue

Failure to meet cost share requirements may impose a financial burden on

Counterpart
o

If Counterpart fails to meet its cost share obligations, the Agreement Officer has the
authority to:

Cost share is subject to audit

o

Auditors will review Counterparts records to see if we are following our own cost
share procedures and to verify that the cost share is in compliance with the primary
donors regulations. They will also seek to determine the following:

Reduce the amount of incremental funding in the following funding period

Reduce the amount of the agreement by the difference between the
expended amount and what we agreed to provide as cost share
Request that we refund the difference in cost share obligation that was not
met if the award has expired or been terminated

See 2 CFR 230

The propriety of proposed or completed transactions

Whether all transactions have been recorded
Whether all transactions have been adequately documented
Whether they have been reasonably and accurately valued
Whether transactions are accurately recorded in the accounts and in the
statements drawn from the accounts

Disallowed cost share expenses can result in the refunding of donor money and/or
reduction in funding for the project!

Cost share performance problems may hurt our reputation

o

Failure to meet cost share requirements may affect Counterparts performance

references and may undermine our chances of getting future funding from the U.S.
federal government

The U.S. federal government accepts cash and in-kind contributions as cost share. Both cash and
in-kind contributions must meet the criteria listed in Table 1 in order to be acceptable.
Cash cost share means that Counterpart uses non-U.S. federal funds to contribute to the cost
share requirements of the award. Unless approved by the CEO, Counterpart does not provide cash
contributions as cost share from Counterparts own private funds.
In-kind contributions3 are non-cash contributions of goods and/or services to a project or program
that were originally procured by a third party with non-U.S. federal funds and will be used in
support of the project or program activities.
Counterpart can obtain cash and in-kind cost share from various sources.

Existing projects funded by non-U.S. federal sources. Expenses incurred for activities
already funded by any non-USG donor can be eligible as cost share on a USG-funded
project if they meet the criteria listed in Table 1 and were incorporated into the projects
scope of work or cost share strategy. Expenses can be considered as cost share from the
start date of the USG project; expenses incurred prior to this date or after the end date of
the USG project cannot count as cost share. Projects obtaining nonfederal
donations/funding to augment or expand their scope will have indirect costs applied to them
and will be tracked with a separate project number.

New funds from non-U.S. federal sources. New funds may be obtained from non-USG
donors that are willing to fund a portion of a project that appeals to their funding interests.
For example, if we have a youth empowerment project in Tajikistan, a private donor might
make a donation to Counterpart to pay for a portion of the small grants for local youth
organizations. Or another non-US donor, like DFID, may want to co-fund the Project. These
funds, once expensed, would be a source of cost share. Please consult GC&C if you have
questions on how indirect costs would be applied in this case.

In-kind contributions come from third-party sources and can include any goods and/or services
procured with non-federal resources that support the program or project objectives. Because we
rely on third parties to provide in-kind cost share, greater care must be taken to quantify and
document the allowability of in-kind cost share. All in-kind cost share must be properly valued
and documented. Refer to Table 3 for detailed guidance.

Contributions by our local partners or sub-grantees. Counterpart can use eligible cost
share provided by our sub-grantees to meet the cost share requirements with the U.S.
federal government. One notable exception is sub-grantee goods/services that they
acquired with USG funding, which cannot be counted as cost share.

2 CFR 215 calls them third-party in-kind contributions

Volunteer time. Volunteer services furnished by professional and technical personnel,

consultants, and other skilled and unskilled labor may be counted as cost share or
matching if the service is an integral and necessary part of the approved project or
program. For example, consultants can agree to donate time to provide free training
services or technical assistance to our local partners. Volunteer services have to be defined
in the consultants scope of work and be pre-approved by the appropriate signatory within
Counterpart. Acceptable language could include consultant agrees to work 7 days at
$500/day and volunteer 5 additional days. The value of the volunteer time must be
equivalent to the current fair market value for comparable worth. For example, if a doctor
decides to volunteer his time to a project as a driver, his time should be valued at that of a
local in-country driver.

Donated goods or inputs in support of program activities. Donated goods can be used
to support program activities or be distributed to beneficiaries as part of the program.
Examples of these are supplies, training materials, computers, medical supplies, etc.

Use of facilities, equipment or supplies. If a third party allows Counterpart to use

facilities, equipment or non-expendable supplies towards program or project activities, the
value of their use may be counted as cost share. For example, if the local government
allows us to use its training center, we can use the value of the use of the center as cost
share. In this case, the cost share is the value of using the training center for one day. If an
organization allows Counterpart to use a vehicle to support project activities, we can report
as cost share the value of using the vehicle for a given period. (However, claiming the full
cost of purchasing the vehicle is not acceptable.) See Table 3 for documentation
requirements.

Unallowable costs. Costs have to be allowable in order to be eligible as cost share4.

Counterpart follows the OMB A-122 Cost Principles (Cost Principles for Non-Profit
Organizations) to determine which costs are allowable or unallowable. For example, the
procurement of alcoholic beverages or military equipment, which is unallowable costs,
cannot be used as cost share. It is important to note, however, that source/origin/nationality
restrictions do not apply to cost share, and restricted goods can acceptable cost share so
long as they are considered an allowable cost in accordance with our cost principles.

Trade discounts. Discounts are not allowable as cost share in U.S.-funded awards
because according to the cost principles that apply to Counterpart, purchase discounts shall
be credited to the U.S. federal government. For example, if Counterpart uses project funds
to purchase 10 computers and the vendor offers a 10 percent discount, this cost reduction
should be credited to the U.S. federal government and cannot be considered cost share.
However, if the vendor donates one computer (as an in-kind contribution), the fair market
value of that computer (if needed and used for the project) is allowable as cost share.

Costs from another USG-funded activity. A common misapplication of cost share occurs
when a project previously funded by USG sources ends and the residual assets are
proposed as cost share in another USG-funded project. An example of a residual asset
would be supplies such as printing paper, pens, pencils, etc., that were bought during a
project and not completely used by its end. The same principle applies to sub-grantees;
special attention must be devoted to ensuring that Counterpart sub-grantees do not,
unknowingly, propose any building, equipment or other resources as cost share if the
acquisition of those items was initially funded by USG sources. The prohibition is USG-

See 2 CFR 215.23

wide, e.g., we cannot use commodities donated by USDA as cost share for a project funded
by USAID.

Leveraging represents all of the non-USG resources that are expected to be applied to a program.
A portion of these resources may meet the cost share eligibility criteria listed in Table 1 and as a
result can be considered cost share. Therefore, cost share meets the definition of leveraging, but
not all leveraging is cost share. Leveraging can include resources that third parties (not the
recipient organization or sub-recipients) bring to the program, or actions that contribute to the
program objectives. Third parties may include the host government, private foundations,
businesses and individuals. Resource leveraging may include services, property or anything of
value that can be measured in some form that permits evaluation of the contributions impact on
achieving desired program results.
Leverage is not a budgetary requirement in an agreement and must not be included in the budget.
Moreover, a statement should be included in the bid indicating that the proposed leverage is not
cost sharing and will not be documented as such. If the USG allows for the option (e.g., cost share
is suggested but not required), it is preferable that Counterpart propose leveraging instead of cost
share, if we want to offer anything at all. If, for strategic reasons, Counterpart wants to offer cost
share, this decision should be made at the early bid decision stage and approved by the Executive
Team.
Cost share is binding and auditable under an award agreement; leverage is not. As a result, the
accountability for leveraging is less stringent. Since leveraging is not financially recorded in or
reported from the financial system, the process for tracking leveraging is much simpler. The project
field office should regularly compile descriptive information about the leveraging activities and their
estimated or approximate value. Before these leveraging activities and their estimated value are
reported to the donor in programmatic reports, the information should be reviewed by the relevant
HQ Program Manager. Ideally, this should be done on a monthly basis. At minimum, it should
occur quarterly, before the quarterly report is submitted.
Please see Appendix A for examples of cost share vs. leveraging.

Meeting cost share requirements is crucial to demonstrate ownership and build our already strong
reputation. Responsibility for meeting cost share commitments resides with Counterparts Program
Staff. The Finance and GC&C teams are available to provide their expertise and guidance to
ensure that cost share is correctly recorded in the financial management system, reported to the
donors and Counterpart is compliant with all of the relevant regulations.
Cost share is an integral part of our proposals and agreements, and we must identify cost share
and manage it from project inception until closeout. The following table presents the project life
cycle with regard to cost share.

Table 2. Cost Share in the Program Life Cycle

Project Stage
Pre-proposal decisions
(Capture)
Proposal development & cost
share strategy

Cost Share Action

Bid decision: if cost share is required, know how much we can
propose and where it will come from.
Use Cost Share Planning Worksheet to develop cost share
strategy. Communicate with partners and sub-grantees and cost

Cost share budget & budget

narrative
Project work plan

Cost share tracking

Cost share documentation &
valuation

Booking cost share

Renegotiating with the donor

share requirements that we want to flow down to them.

Include cost share but not leverage in the budget. Clearly explain
type, source, expected value and how it will be documented.
Ensure project activities and results affected by cost share are
included.
Monitor cost share on pipeline reports and grant trackers. Be
prepared to take action if needed and communicate with/monitor
sub-grantees regularly to ensure they are regularly reporting and
meeting their cost share obligations.
Use Cost Share Documentation & Valuation table. For in-kind cost
share, use fair-market value and be consistent.
Follow sequence of steps in the Booking Cost Share section of
these Guidelines to ensure timely, regular and efficient review and
booking.
If circumstances change and the project will not meet its cost share
commitment, begin negotiations with the donor as soon as
possible to reduce the cost share requirement. Do not wait until the
end of the Project!

As we would have only very preliminary information at this stage, in order to make a reasonable
decision, we have to be able to answer, at a minimum, the following questions:
Is the donor requiring cost share?
How much cost share can we responsibly propose?
What are the potential cost share sources?
If cost share is not a required component, then we should present any contributions on behalf of
Counterpart as leveraging.
If, for strategic reasons, Counterpart wishes to include otherwise unrequired cost share in a
proposal, Executive Team approval is required.

Our proposal should describe Counterparts response to cost share requirements, including types
of cost share we can realistically offer.
During the proposal development stage, we start to develop our cost share strategy by using the
Cost Share Planning Worksheet (see Appendix B) to list the sources of cost share and the
estimated amounts. This sheet is not intended to be an exact prediction, but rather a good exercise
to help program designers estimate and have a solid understanding of the commitment they are
making on Counterparts behalf.
It is important to be clear with partners and sub-grantees from the very beginning if they will have a
cost share requirement and how they intend to meet it. This should be a two-way discussion, and
the proposal should not include a target that our partners and subrecipients/subgrantees did not
agree to beforehand or that we believe they cannot achieve. Evidence of commitment to providing
cost share should be explicitly demonstrated in sub-grantees budgets and budget narratives. If we
will be expecting cost share from subs that are yet to be determined, the cost share requirement
must be included in the RFA issued as part of the competitive bidding process that we would
conduct to select sub-grantees

In all cases, the cost share commitment should be both conservative and realistic. We should also
understand the degree of control that Counterpart has over the sources of cost share. Letters of
Support from third parties or our partner(s) stating their commitment to cash or in-kind contributions
should be included in our proposal to demonstrate their commitment to meeting the programs cost
share requirement.
The cost share strategy is an integral input to the cost proposal and the worksheet should be
attached to the cost proposal for the Green Teams budget review. The Cost Share Planning
Worksheet along with the budget and budget narrative will serve as important references for
program teams as they implement the project.

In our proposed budget, we will have to define (at a minimum) the following:

Types of cost share

Sources of cost share
Amounts (and valuation, including methodology, in the case of in-kind contributions)
Justification: how the proposed cost share will support the proposed program
objectives, scope of work and activities

The Cost Share Planning Worksheet has to be incorporated into the budget, using the cost share
column in the budget template. Each cost share line has to be clear and show what activity will be
supported by cost share, the type of cost share (cash or in-kind) and the total amount. Note that
leverage is not a budgetary requirement and must not be included in the budget.
The cost share narrative has to be concise and clear for several reasons. We want to convey a
clear idea to our donor of what resources we propose to contribute to the project and demonstrate
to the maximum extent possible that our cost sharing plan is realistic.
The budget narrative must:
Make the distinction between cash cost share and in-kind contributions
Express the total value as a percentage of the overall budget
Explain how cost share was estimated listing the proposed sources, activities (uses
of the resources) and total amounts
Clearly state how Counterpart will be able to document each source of cost share
If the proposal includes leverage in addition to cost share, leverage and cost share should be
described in separate paragraphs. The paragraph about leverage has to detail the nature of
leveraging, estimated amount, method used to estimate value, and parties from which such
leveraging is to be accessed. The paragraph on leveraging in the proposal should also clearly state
that Counterpart will not track leveraging efforts in its financial reports but rather describe in
program reports the level of leveraging accessed and how it enhanced the program being
implemented by Counterpart.

After a prime award is made and at the initial work plan stage, the project team will have time to
follow up with the entities that proposed to provide contributions to the project, confirm and
formalize their commitment and the timeframe for those contributions. The project team will update
the Cost Share Planning Worksheet, forecast cost share contributions for the period and identify
and plan to fill any gaps in cost share. In preparing project work plans, Program Managers and
Program Officers are advised to ensure that project activities and results affected by the cost share
budget are also included in the work plan in order to alert parties responsible for generating the

cost share input that such input (cash or in-kind) is expected for program implementation as stated
in the work plan.
The annual work plan and semiannual reports are also good opportunities to report unexpected
changes in cost share conditions that are relevant to the project, and also to propose adjustments
to our cost sharing strategy and/or amount. During the life of a project, we have the opportunity to
open dialogue with our donor and, if needed, request a budget modification.

Cost share tracking is as important as tracking the expenditure of donor funds for project purposes.
An important tool in tracking and monitoring cost share status is the Monthly Financial (Pipeline)
Report that shows actual and budgeted amounts. Program Managers and COPs should regularly
review the budget line item showing cost share and follow up with their Program leadership and
GC&C if they have questions or concerns about not meeting the cost share commitment. Cost
share shortfalls and issues related to obtaining and reviewing documentation are also discussed at
monthly project financial review meetings.
Given that a large percentage of cost share comes from sub-grantees, tracking and monitoring
cost share status also involves an emphasis on proper communication with, training and
monitoring of sub-grantees throughout the life of the project. If cost share is part of a sub-grant
agreement, Counterpart project staff should:
Inform sub-grantees at the beginning of their award about what does and does not
constitute allowable cost share
Monitor sub-grantees for compliance on cost share issues at least quarterly
Document sub-grantee cost share records
Record cost share on a timely basis as it is accumulated
Ensure all cost share is received and documented before the final payment is disbursed

High-quality and well organized cost share documentation helps projects meet cost share
commitments and reduces the risk of audit disallowances. Documentation is considered to be high
quality when the following guidelines are met:

Documentation should come from a reliable source (e.g., directly from the contributor or
vendor)
Documentation should include detailed information on value (valuation unit, number of
units, rates, etc.) and when the good or service was delivered
Cost share documentation should be collected and reviewed on a regular basis by
Counterpart project staff monitoring subgrantees. In addition, on a semi-annual basis, onsite annual audits of subgrantee cost share reporting should be conducted during a
monitoring site visit. Such verification includes tracing the amount reported by the subgrantee as cost share to sub-grantee accounting records and supporting documents on a
sample basis.

Most cost share falls into one of five categories:

Cash donations or grants

Labor donated employee time or volunteer labor
Equipment and supplies new or existing
Space one time or occasional use of venue space or regularly used office or meeting
space
Travel including airfare, ground transportation and per diem

The valuation of cash donations or grants is straightforward. The valuation of in-kind cost share
rests on two key principles: fair-market value and consistency.

Fair-market value should always be the reference point for determining complete cost share
value. Always consider what the price for the cost share contribution would be if purchased
on the open market. In other words, what would it cost if it weren't free? The cost share
value should always be based on an amount very close to the fair market value of the
contribution in the project setting. Determining fair-market value may require one or more
third-party quotes and/or a vendor verification of value (receipt or invoice). For relatively
smaller amounts of in-kind cost share, a Certification of value is acceptable. (See Table 3).

A second key principle of cost share valuation is consistency. The method used for valuing
the cost share contribution must be consistent with the method used by the donor in
computing value of a like item using its own policies and practices. When it is necessary to
use an exchange rate, use a rate calculated on a date as close as possible to the date
when the expense was incurred.

Some types of cost share require a higher standard of documentation and/or a more rigorous
valuation methodology as the value of the cost share increases. The following table describes each
of the five categories of cost share and the documentation required for each. It also provides the
valuation unit for each kind of category of cost share.
The Cost Share Certification (Appendix C) should be completed for any paid Employee donated
time and any Volunteer time that is being reported as an in-kind contribution. The Certification is in
Excel and contains two tabs, 1) Cost Share Certification; and 2) Donated Time List. Both forms
should be completed in accordance with the instructions and Table 3 below.

Table 3. Cost Share Documentation and Valuation

Cash
Donation
Cash Donation from a third
party (non-USG)

Required Documentation

Valuation
Unit

Letter or agreement from the Donor

Proof of receipt (check from donor or Counterpart bank statement

showing funds received)

Verification of final value through a financial report showing amounts

actually expended on project costs.

Grant
Grant from Non-USG
Donor

Letter or agreement from the Donor

Proof of receipt (check from donor, Counterpart bank statement

showing funds received)

Verification of final value through a financial report showing amounts

expended on project costs.

Labor
Donated non-CPI
Employee Time
Non-CPI regular
employees' time financed
by another source as a
donation to the program.

Required Documentation

Valuation
Unit

Employees timesheet showing hours worked on project funded by

another source

/employee
per year

Pay-Stub

A dated Certification signed by employee and their employer confirming

time donated and source of funding of donated time (who funded the
employees salary for the donated time)

Volunteers
Time devoted by persons
who offer to freely donate
their time to activities that
benefit the Project.
Volunteers are not paid
and they are not
employees of CPI or the
Grantee implementing the
project.

$0-$1000

Proof of occurrence/verification of donated time by beneficiary

Confirmation of time donated by Volunteer
Confirmation of time donated and fair market value by CPI or Grantee
implementing the project
By Completing and signing:
A dated certification stating the name of the volunteer(s), the work
performed, the amount of time worked, and the per hour fair market
value signed by the benefiting community representative, the
volunteer(s) and the CPI or Grantee implementing the project. The per
hour fair market value should be determined by CPI or the Grantee
implementing the project.

>$1000

Proof of occurrence/verification of donated time by beneficiary

Confirmation of time donated by Volunteer
Confirmation of time donated and fair market value by CPI or Grantee
implementing the project
Evidence/quote of similar services on the open market
By Completing and signing:
A dated certification stating the name of the volunteer(s), the work
performed, the amount of time worked, and the per hour fair market

/total
volunteer
costs
claimed

/total
volunteer
costs
claimed

value signed by the benefiting community representative, the

volunteer(s) and the CPI or Grantee implementing the project. The per
hour fair market value should be determined by CPI or the Grantee
implementing the project.

Equipment & Supplies

New
A cost spent to purchase or
lease fixed assets for the
purpose of project
implementation

Required Documentation
Any Value

Existing
A cost realized by the
organization for utilization
of existing fixed assets that
are needed for project
implementation

Verification of necessity (item and amount needed was included in the

approved budget and/or pre-approved by Counterpart)
Evidence of donation: A dated certification stating the Recipient name,
the number and description(s) of the donated item(s), the purpose of
the donated item(s), the actual value of the donated item(s), signed by
the Recipient and the Donating organization on the organizations
letterhead
New equipment/supply invoice showing the value OR vendor verification
of the value

Any Value

Verification of necessity (item and amount needed was included in the

approved budget and/or pre-approved by Counterpart)
Evidence of donation: A dated certification stating the Recipient name,
the number and description(s) of the donated item(s), the purpose of
the donated item(s), the fair market value of the donated item(s), signed
by the Recipient and the Donating organization on the organizations
letterhead
Evidence of fair market value by a third party (i.e., vendor)

Valuation
Unit
/Individual
Item

/item per
year

Space
One-time
Venue space used to host
an organized event that
directly impacts the project

Required Documentation
$0-1,000

Verification of necessity (item and amount needed was included in the

approved budget and/or pre-approved by Counterpart)
Evidence of donation: A dated certification stating the Recipient name,
description(s) of the donated space(s), the purpose and timeframe, the
fair market value of the donated space, signed by the Recipient and the
Donating organization on the organizations letterhead
>$1,001

Verification of necessity (item and amount needed was included in the

approved budget and/or pre-approved by Counterpart)
Evidence of donation: A dated certification stating the Recipient name,
description(s) of the donated space(s), the purpose and timeframe, the
fair market value of the donated space, signed by the Recipient and the
Donating organization on the organizations letterhead

Valuation
Unit
/space and
timeframe

/event

Evidence of fair market value by a third party for the rental of space (i.e.,
vendor)

Ongoing
Office or meeting space
used regularly throughout
the grant to support
program activities

Travel
Airfare
Airplane transportation
plus per diem and other
travel related costs, when
applicable, necessary to
conduct program activities

Required Documentation

Valuation
Unit

Verification of necessity (included in the approved budget and/or preapproved by Counterpart)

A dated certification from the donating organization stating the specific
donation (plane ticket, per diem, etc.), travelers name, dates and
purpose of the travel, the actual cost(s) of the travel, source of funding
for the travel, signed by the traveler and the donating organization on
the organizations letterhead
A copy of the travelers travel expense report showing all donated travel
costs with receipts and evidence that travel did not come from USG
funding

/trip

Verification of necessity (included in the approved budget and/or preapproved by Counterpart)

A dated certification from the donating organization stating the specific
donation (plane ticket, per diem, etc.), travelers name, dates and
purpose of the travel, the actual cost(s) of the travel, source of funding
for the travel, signed by the traveler and the donating organization on
the organizations letterhead
A copy of the travelers travel expense report showing all donated travel
costs with receipts and evidence that travel did not come from USG
funding
Donating organizations travel policy to verify rates being used (which is
either the rates established by their own travel policy, actual amounts or
the State Department rates)

/day

Verification of necessity (included in the approved budget and/or preapproved by Counterpart)

A copy of the travelers travel expense report showing the donated
travel costs with receipts and evidence that travel did not come from
USG funding
If personal vehicle, evidence of usage amount (mileage traveled) and

/year

Ground Transportation
Transportation costs
necessary to conduct
program activities

/space and
timeframe

Per Diem
Per diem expenses
necessary to conduct
program activities

Any Value
Verification of necessity (item and amount needed was included in the
approved budget and/or pre-approved by Counterpart)
Evidence of donation: A dated certification stating the Recipient name,
description(s) of the donated space(s), the purpose and timeframe, the
fair market value of the donated space, signed by the Recipient and the
Donating organization on the organizations letterhead
Evidence of fair market value by a third party for the rental of space (i.e.,
vendor)

organizations policy on mileage reimbursement (or must comply with

Federal Travel Regulations policy on mileage reimbursement)
A dated certification from the donating organization stating the specific
donation (plane ticket, per diem, etc.), travelers name, dates and
purpose of the travel, the actual cost(s) of the travel, source of funding
for the travel, signed by the traveler and the donating organization on
the organizations letterhead

Ensuring compliance with the Cost Share regulations and requirements is a shared duty across the
organization. However, the primary responsibility for ensuring Counterparts projects meet cost
share commitments rests with the Chiefs of Party (if no Chief of Party then the Project Director),
with the support of the team as well as the HQ Program Managers/Officers. The field-office
program/project staff is responsible for tracking, compiling the documentation and recording cost
share. The HQ program/project staff is responsible for reviewing the cost share documentation and
ensuring the accuracy and eligibility of the documentation before the cost share costs are booked
in the accounting system.
The GC&C Department supports program/project efforts by providing their expertise and advice on
the cost share regulations, providing guidance and eligibility determination upon request and
providing cost share training. The GC&C Department is available to lead cost share discussions
with the donor, specifically on requesting cost share reductions.
The HQ Finance Officer for the Project is responsible for uploading and posting cost share to the
accounting system and preparing the financial reports to the donor that include cost share
information.

The following sequence of steps will help ensure efficient, tracking, booking and reporting of cost
share:
1.

Designated field employee(s) track(s) cash and in-kind cost share as it is accumulated and
ensure(s) required documentation is collected and reviewed regularly and in a timely
manner for completeness and accuracy. The GC&C Team is consulted when there are any
questions.

2. Designated field employee(s) complete(s) and sign(s) the Cost Share Report (Appendix D)
and send(s) the complete cost share package (with back up documentation) to the Chief of
Party (or Project Director if no Chief of Party) for review and signature approval.
3. The Chief of Party (or Project Director if no Chief of Party) should review the
documentation, particularly the in-kind cost share valuation, to ensure accuracy and
completeness, and provides signature approval.
4. Designated field employee forwards the completed and approved Cost Share Report with
the complete cost share package to the HQ Program Director for review.
5. The HQ Program Director or designee reviews the documentation, confirms the cost share
benefit to the program, that the cost share is in accordance with the approved Work Plan
and budget and that the cost share claimed and back up documentation meets the eligibility
criteria. Any questions and/or corrections are handled and resolved between the HQ

Program Director, or designee, and the field office. The GC&C Team is consulted on
eligibility questions.
6. Once reviewed and approved, the HQ Program Director, or designee, signs the Cost Share
Report and forwards the package to the HQ Finance Officer.
7. The HQ Finance Officer reviews and may select a sample of entries from the Cost Share
Report to spot check the documentation.
8. The HQ Finance Officer signs the Cost Share Report and requests by email that the field
enter cost share information into their local QuickBooks, copying the HQ Program Director,
or designee.
9. The responsible field employee enters the cost share amounts in QuickBooks.
10. QuickBooks reports are sent to the HQ Finance Officer for uploading, posting, reporting and
retention.

Once the cost share has been booked in the field office, the cost share documentation must be
maintained in the field files. For in-country audits, the field office set will be the file of record.
The set of documentation sent to HQ will be maintained in the HQ finance files. For HQ audits or
other purposes, the scanned set of documents will be the file of record.

It is important that Counterpart record cost share on a timely basis as it is accumulated, to comply
with reporting requirements and to demonstrate the project is making adequate progress toward its
cost share commitment. USAID monitors recipient cost share reporting and expects recipients to
report cost share on the same schedule as their financial reporting.
All effort must be made to follow up, document and record cost share transactions in the
accounting records in the period the cost share transactions occurred. Therefore, field offices are
expected to submit and report to HQ cost share on a monthly basis, provided there is cost share to
report and record
If additional time is needed to obtain documentation for cost share activities that occurred in one
fiscal year, those costs can be booked in the next fiscal year provided there is sufficient
documentation. Please consult with your HQ Finance Officer or the Field Finance Director for
guidance under such circumstances.
In addition, there are other practical considerations to take into account in order to avoid delay in
monitoring and recording of cost share transactions. It may be difficult or impossible to gather
proper documentation toward the end of a project, as staff time will be devoted to numerous other
close-out activities. Also, if sub-grantee agreements have closed, Counterpart has little contractual
recourse in motivating sub-grantees to provide cost share documentation.

In general, Counterpart prefers to take a conservative approach to how much cost share it commits
to generating on any of its projects. Sometimes external factors can interfere with Counterparts
ability to generate the cost share specified in its award. This can include anything from the closing
of a key partner to political and economic instability in a program country or a programmatic
redirection by the donor. Counterpart should try to renegotiate its cost share requirement with the
donor to lower its commitment. This should only be undertaken in coordination with the VP,

Programs, the CFO and the Sr. Director of GC&C. Any renegotiation should be done as soon as
the determination is made and well before the end of the projects period of performance.
Any cost share renegotiation must be made in writing to the Agreement Officers Representative
(AOR) and the Agreement Officer (AO). Only the AO can authorize a cost share adjustment, unless
that determination is delegated by the AO to the AOR. The determination must be provided by the
AO or designee in writing.
Also if the donor reduces or increases the proposed amount of the award, the committed cost
share may need to be adjusted accordingly. Any adjustment to cost share should be correctly
stated in the award. Technically, Counterparts cost share is automatically reduced if the estimated
amount of funding is reduced. However, this should be confirmed in writing with the AO.

These are the regulations referenced in our USAID funded awards for your reference and use as a
management tool:

I. 22 CFR Part 226 - ADMINISTRATION OF ASSISTANCE AWARDS TO U.S. NONGOVERNMENTAL ORGANIZATIONS

226.23 Cost sharing or matching.
(a) All contributions, including cash and third party in-kind, shall be accepted as part of the
recipient's cost sharing or matching when such contributions meet all of the following criteria.
(1) Are verifiable from the recipient's records.
(2) Are not included as contributions for any other federally-assisted project or program.
(3) Are necessary and reasonable for proper and efficient accomplishment of project or program
objectives.
(4) Are allowable under the applicable cost principles.
(5) Are not paid by the Federal Government under another award, except where authorized by
Federal statute to be used for cost sharing or matching.
(6) Are provided for in the approved budget.
(7) Conform to other provisions of this part, as applicable.
(b) Unrecovered indirect costs may be included as part of cost sharing or matching.
(c) Values for recipient contributions of services and property shall be established in accordance
with the applicable cost principles. If USAID authorizes recipients to donate buildings or land for
construction/facilities acquisition projects or long-term use, the value of the donated property for
cost sharing or matching shall be the lesser of:
(1) The certified value of the remaining life of the property recorded in the recipient's
accounting records at the time of donation, or
(2) The current fair market value. However, when there is sufficient justification, the USAID
Agreement Officer may approve the use of the current fair market value of the donated
property, even if it exceeds the certified value at the time of donation to the project.
(d) Volunteer services furnished by professional and technical personnel, consultants, and other
skilled and unskilled labor may be counted as cost sharing or matching if the service is an integral
and necessary part of an approved project or program. Rates for volunteer services shall be
consistent with those paid for similar work in the recipient's organizations. In those instances in
which the required skills are not found in the recipient organization, rates shall be consistent with
those paid for similar work in the labor market in which the recipient competes for the kind of

services involved. In either case, paid fringe benefits that are reasonable, allowable, and allocable
may be included in the valuation.
(e) When an employer other than the recipient furnishes the services of an employee, these
services shall be valued at the employee's regular rate of pay (plus an amount of fringe benefits
that are reasonable, allowable, and allocable, but exclusive of overhead costs), provided these
services are in the same skill for which the employee is normally paid.
(f) Donated supplies may include such items as expendable equipment, office supplies, laboratory
supplies or workshop and classroom supplies. Value assessed to donated supplies included in the
cost sharing or matching share shall be reasonable and shall not exceed the fair market value of
the property at the time of the donation.
(g) The method used for determining cost sharing or matching for donated equipment, buildings
and land for which title passes to the recipient may differ according to the purpose of the award, if:
(1) If the purpose of the award is to assist the recipient in the acquisition of equipment,
buildings or land, the total value of the donated property may be claimed as cost sharing or
matching, or
(2) If the purpose of the award is to support activities that require the use of equipment,
buildings or land, normally only depreciation or use charges for equipment and buildings
may be made. However, the full value of equipment or other capital assets and fair rental
charges for land may be allowed, provided that the USAID Agreement Officer has approved
the charges.
(h) The value of donated property shall be determined in accordance with the usual accounting
policies of the recipient, with the following qualifications.
(1) The value of donated land and buildings shall not exceed its fair market value at the
time of donation to the recipient as established by an independent appraiser (e.g., certified
real property appraiser or General Services Administration representative) and certified by
a responsible official of the recipient.
(2) The value of donated equipment shall not exceed the fair market value of equipment of
the same age and condition at the time of donation.
(3) The value of donated space shall not exceed the fair rental value of comparable space
as established by an independent appraisal of comparable space and facilities in a
privately-owned building in the same locality.
(4) The value of loaned equipment shall not exceed its fair rental value.
(i) The following requirements pertain to the recipient's supporting records for in-kind contributions
from third parties.
(1) Volunteer services shall be documented and, to the extent feasible, supported by the same
methods used by the recipient for its own employees,
(2) The basis for determining the valuation for personal services, material, equipment, buildings
and land shall be documented.

II. REQUIRED AS APPLICABLE STANDARD PROVISIONS FOR U.S.

NONGOVERNMENTALORGANIZATIONS
RAA9. COST SHARING (MATCHING) (FEBRUARY 2012)
APPLICABILITY: This provision, along with 22 CFR 226, is applicable when the recipient
has agreed or is required to cost share or provide a matching share.

a. If at the end of any funding period, the recipient has expended an amount of non-Federal funds
less than the agreed upon amount or percentage of total expenditures, the Agreement Officer may
apply the difference to reduce the amount of USAID incremental funding in the following funding
period. If the award has expired or has been terminated, the Agreement Officer may require the
recipient to refund the difference to USAID.
b. The source and nationality requirements and the restricted goods provision established in the
Standard Provision entitled "USAID Eligibility Rules for Goods and Services" do not apply to cost
sharing (matching) expenditures.

END

Appendix A: Cost Share vs. Leveraging

Example

Criteria

1. The host government

has decided to adopt
Counterparts civic
education handbook for its
secondary school
curriculum but does not
give direct funds to the
Counterpart program that
produced it.

Cost Share contributions (must meet all criteria)

2. In designing a USAIDsupported civic education

program for Country X,
Counterpart was able to
secure funding from the
host government to
develop and distribute a
civic education handbook
to be added to its
secondary school
curriculum.

Are verifiable from Counterpart's records

Are not included as contributions for any other
federally assisted project or program
Are necessary and reasonable for proper and
efficient accomplishment of project or program
objectives
Are allowable under the applicable cost
principles
Are not paid by the U.S. federal government
under another award
Are provided for in the approved budget
Conform to other applicable provisions in
2CFR215.23

Leveraging (must meet one or more of the criteria)

Non-USAID resource applied to the program

Resources that third parties bring to the program,
or to actions that contribute to the program
objectives, without necessarily providing them to
the recipient (or sub-recipients)
May include services, property, or anything of
value that can be measured in some form that
permits evaluation of the contributions impact on
achieving desired results.

Cost share
or
Leveraging?
1. Leveraging
but not Cost
Share

2. Cost Share
(and also
Leveraging)

Appendix B: Cost Share Planning Worksheet

(The Excel file of this form can be found on the GC&C Intranet page under Form)
Cash Cost Share
Source
Include only one source per
row. Name the entity that will
make/has made the
contribution.

Description

Supporting documentation

Amount

Describe expenditure line item

and/or inputs that will be procured
with these funds. Quantify the
number of units and unit cost.

See Table 3

Cash

In-Kind Cost Share

Source
Include only one
source per row. Name
the entity that will
make/has made the
contribution.

Description
Provide a brief
description of the inkind item(s) provided.
Quantify the number
of units.

Application
Specify component
and activity where
the in-kind item is
used for project
purposes.

Valuation (inkind)

Supporting
Documentation

Amount

See Table 3

Value of
In-Kind

Method used
to determine
value.

Leverage

Source
Include only one
source per row.
Name the entity
that will make/has
made the
contribution.

Description

Provide a brief
description of the
leveraging activity.

Application

Specify component and

activity that is being
affected or enhanced by
leveraged activity.

Supporting
Documentation

Information on
leveraged activity
with estimated or
approximate value

Estimated Amount

Leverage

Appendix C. Cost Share Certification

Counterpart International Cost Share Donated Time Certification
Date:
Reporting Period of Cost Share:
(Month(s)/Year)
Project Name:

Project Number:

Country Name:
Type of Donated Time (check appropriate type(s)):
Paid Employee Donated Time:

Volunteer Time:

Specify Source of Non-US Government Funds used for Paid Employee Donated Time:
Description of Activity/Event:

Donated Time

Employee/
Volunteer

Example: Jane Doe

Currency Type:
Time Donated
3.3

Rate per Unit (in

local currency)
190

Value of Donated
Time
627.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00

Exchange Rate:

19

TOTAL AMOUNT:

$0.00

By signing below, I certify that 1) all cost share is part of the approved Cost Share Plan; 2) all cost share documentation has been reviewed
and is in compliance with the cost share eligibility, documentation and valuation requirements; 3) all above stated cost share amounts can
be verified through our organization's records; 4) have not been included as cost share for any other US Government-funded
program/award; and 5) have not been funded/paid by any US Government source of funding either directly or indirectly through another
prime organization.
Date:

Prepared and Requested by:

Enter name and title

Date:

Field COP/PD Review/Certification:

Enter COP/PD Name and title

Date:

HQ Program Review/Certification:
Enter HQ Program Name and title

Date:

Finance Entry Only: HQ Finance Officer:

Enter HQ Program Name and title

PROJECT NAME:
PROJECT NUMBER:
ACTIVITY/EVENT:
DATE OF ACTIVITY/EVENT:
INDIVIDUAL(S) DONATING TIME:
Type (E/V) Printed Name of Individual
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

Ex. Jane Doe

Brief Description of Donated Time

Painted School

Time Donated (Hours and

Minutes)
3.30 hours

Individual's Signature Certifying Time Donated

Signature

Appendix D: Cost Share Report

Counterpart International, Inc.

Cost Share Report

Field Office:
Project Name and Number:
Reporting Period:

Enter Name
Enter Name and Number
Enter Month and Year or Date Range

NOTE: Please scan and attach supporting documentation as required per Cost Share Manual Guidelines
Attachment #

Cash

Value (Specify Local

Currency)

Description

2
3
4
5
Subtotal Cash

Attachment #

Labor

Value (Specify Local

Currency)

Description

0.00

Subtotal Labor

Attachment #

Equipment/Supplies

Value (Specify Local

Currency)

Description

0.00

Subtotal Equipment

Attachment #

Space

Value (Specify Local

Currency)

Description

0.00

Subtotal Space

Attachment #

RATE:

Travel

Value (Specify Local

Currency)

Description

ENTER EXCHANGE RATE HERE

Subtotal Travel

0.00

TOTAL CLAIM LOCAL CURRENCY:

TOTAL CLAIM US DOLLAR:

0.00
#VALUE!

Certification
By signing below, I certify that 1) all cost share is part of the approved Cost Share Plan; 2) all cost share documentation has been reviewed and is in compliance with the
cost share eligibility, documentation and valuation requirements; 3) all above stated cost share amounts can be verified through our organization's records; 4) have not
been included as cost share for any other US Government-funded program/award; and 5) have not been funded/paid by any US Government source of funding either
directly or indirectly through another prime organization.
Requested by:
Type Name Here, Title
Field COP/PD Review/Certification:

Date

Appendix E: Glossary of Cost Share Terms

Allowable refers to costs that are:

Verifiable from records

Necessary and reasonable (toward accomplishing the objectives of the program award)
Included in the budget approved by the donor
Conform to other applicable administrative requirements (e.g., Counterparts policies and
procedures)
Not counted as cost share on more than one USG-funded activity (for federally funded
programs)
Allowable under the applicable cost principles (for federally funded programs)
Not paid by the USG (for federally funded programs)

Amendment: An authorized modification to an approved application or award.

Award: Counterparts signed agreement (i.e., the prime award) with the main donor.
Cost share: The resources that Counterpart contributes, from nonfederal sources, to the total cost
of an award. Cost share is subject to the requirements of 22 CFR 226.23. (Cost share may also be
referred to as matching funds.)
Donor: The source providing the funding for the program/activity
Disallowed costs: Any charges to the approved grant that the donor has determined to be beyond
the scope of the purpose of a grant, excessive, or otherwise unallowable. Grantees receiving an A133 audit, or its equivalent, may have their costs questioned by auditors. The Grant Officer (either
from the awarding agency or the Prime Recipient, in the case of a sub-grant) must review the A133 audit report and make a determination whether to allow or disallow the cost.
Fair-market value: An estimate of what a knowledgeable, willing and unpressured buyer would
pay for the good or service in a specific marketplace.
Geographic code: a three-digit number that for USAID administrative purposes identifies
geographic entities such as countries, territories, regions and subregions.
Leveraging: Leveraging represents all of the non-USG resources that are expected to be applied
to a program. Cost share is a subset of leveraging.
Mandatory cost share: Cost share that is a written requirement in your agreement by the donor.
Nationality: SON (Source/Origin/Nationality) restrictions require suppliers of commodities to be
either an individual who is a citizen or lawfully admitted permanent resident of a country in the
authorized geographic code or a corporation organized under the laws and with a place of
business in a country in the authorized geographic code. Suppliers of service need to be
individuals who are citizens and have a place of business in a country in the authorized geographic
code; privately held companies owned by a citizen of a country within the geographic code and
having its principal place of business there; or corporations or partnerships that are more than 50
percent owned by citizens of a country within the geographic code. SON does not apply to cost
share.
Origin: A USAID term that refers to the country where a commodity is produced or where the
manufacturing, processing or major/substantial assembling of components takes place.

Reasonable: Being within the bounds of common sense; not excessive or extreme. A cost is
reasonable if, in its nature or amount, it does not exceed that which would be incurred by a prudent
person under the circumstances prevailing at the time the decision was made to incur the costs.
Restricted goods: Goods that shall not be procured without the prior approval of the USAID
Agreement Officer. They include:

Agricultural commodities;
Motor vehicles;
Pharmaceuticals;
Pesticides;
Used equipment;
USG-owned excess property;
Fertilizer.

Prior approval will be deemed to have been met when: (i) the item is of U.S. source/origin; (ii) the
item has been identified and incorporated in the program description or schedule of the award
(initial or revisions), or amendments to the award; and (iii) the costs related to the item are
incorporated in the approved budget of the award. Where the item has not been incorporated into
the award as described above, a separate written authorization from the Agreement Officer must
be provided before the item is procured. The same prior approval must be received for restricted
goods to count as cost share.
Source: A USAID term that refers to the country from which a commodity is shipped to the
cooperating country or the cooperating country itself if the commodity is located there at the time of
the purchase.
Third parties: Entities other than Counterpart. These may be partner organizations, beneficiary
organizations (NGOs, universities, media outlets, etc.), or any organization or individual that is
providing support (cash, goods or services) toward the program.
Verifiable: Able to be proven or confirmed by an outside party.