In planning or refining a project budget, the first recommended step is to estimate the direct costs for each activity within the project schedule. Once resource cost totals are in place for each activity, the costs can be aggregated to produce the overall totals for each cost category of a project. Cost categories may include: salaries and wages; equipment; travel; dissemination; and material/consumables.
In identifying cost estimates for a project, it is important to remember that not all project costs are directly attributable to project activities. This refers to the indirect costs that may have to be included in the project cost totals. Indirect costs can include building use, equipment depreciation, building/equipment maintenance, insurance, research administration, financial administration, and human resources administration. Please see Memorial University’s ‘Indirect Costs on Externally Funded Research’ policy for more information regarding its applicability to your research proposal. It is also important to understand a funding sponsor’s policy for eligible project costs. Please follow-up with the funding sponsor and your Faculty Grant Facilitator to determine if project costs are eligible.
Furthermore, a research project may have In-kind contributions that contributes to the overall cost of a project. In-Kind contributions represents the provision of goods or services to a project by one of its stakeholders, valued in monetary terms. This may include goods, use of services and facilities, professional services or expertise in the form of staff time, provision of or access to equipment, or special materials. Because a monetary value can be associated with these contributions, they can be identified as In-Kind expenses and thus included in the Total Cost of a project.
Finally, once the project budget has been planned, it is important to identify planned sources of funding (project financing). Clearing identifying sources of project financing will ensure adequate project funding is available to complete the planned project scope, and will aid in the financial monitoring of the project.