INDIRECT COST PLAN
ADMINISTRATIVE SERVICES RATE – INDIRECT COST PLAN 2011
AVACON, INC. (FEIN: 27-2428600)
A. INTRODUCTION
AvaCon, Inc. is a 501(c)(3) public charity nonprofit corporation located in Rehoboth, MA, USA. AvaCon, Inc. (“AvaCon”) administers a variety of programs funded by charitable donations, ticket sales to events, and other institutions. These programs include conventions and meetings to promote educational and scientific inquiry into the growth, enhancement, and development of the metaverse, virtual worlds, augmented reality, and 3D immersive and virtual spaces. AvaCon’s fiscal year ends on December 31.
B. COST ALLOCATION METHODOLOGY
This indirect cost rate plan is based on AvaCon’s actual costs for its fiscal year beginning January 1, 2011 and ending December 31, 2011.
C. DIRECT COSTS
Direct costs are costs that can be identified specifically with a project and therefore are charged to that project. The accounting system records these costs as they are incurred. Further distribution is not required.
D. INDIRECT COSTS
Indirect costs are costs incurred for common or joint objectives and therefore cannot be readily and specifically identified with a particular project or activity. Indirect costs are charged to all programs and grants.
E. COST POOL AND BASE FOR DISTRIBUTION
At this time, AvaCon does not have any salaried staff and does not offer any fringe benefits. Each category of non-salary expenditures has been analyzed based on the fact, and the Elements of Cost explains the allocation between the Direct and Administrative Services (Indirect) Costs.
F. SUPPORTING FINANCIAL STATEMENTS
ATTACHMENT A – AVACON 2011 IRS Form 990 Public Inspection Copy
Unallowable and Excluded Costs: The following costs have been excluded from the allocation process: capital expenses over $5,000, entertainment, fines, penalties, food costs, and any other non-allowable expenses.
G. DESCRIPTION OF ACCOUNTING SYSTEM
AvaCon uses a cash basis system of accounting. Revenues are recorded when they are received, which may be before or after they are earned. Expenses are recorded when they are paid, which may be before or after they are incurred. Financial statements reflect revenues and expenses based on when transactions were entered rather than when revenues were earned or expenses incurred.
We have not made any significant changes (1) to our accounting system, or (2) to the definition or to the accounting treatment of any expense category (e.g. a change in building/equipment costing methodology, capitalization level, or a change in charging an expense from direct to indirect or vice versa).
H. INDIRECT SALARIES
At this time, AvaCon does not have any salaried staff.
I. FRINGE BENEFITS
At this time, AvaCon does not offer any fringe benefits.
J. NON-SALARY COSTS
Non-salary costs include expenses incurred for common or joint objectives which cannot be readily and specifically identified with a particular project or activity. These include costs unrelated to any specific project, including annual filing fees, professional services costs, general office supplies and postage, insurance and liability coverage, and other administrative costs.
K. COMPUTATION OF BASE COSTS
AvaCon uses the Simplified Method for calculating the indirect rate, by classifying the total cost for the base period as either a direct or indirect cost, and dividing the total allowable indirect costs by the total base cost.
L. RATE
AvaCon’s Administrative rate was calculated on the following basis (ATTACHMENT B):
| Cost Category | Amount |
| Direct Costs | $43,678.37 |
| Indirect Costs | $3,586.31 |
| Unallowable Costs | $574.73 |
| Indirect Costs / Total Allowable Costs | 8% |
M. ORGANIZATIONAL CHART
See ATTACHMENT C.
N. NON-PROFIT STATUS VERIFICATION
Attached you will find our IRS Letter granting non-profit status (ATTACHMENT D).
