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AC 150/5100.10A Appendix 4 determination of allowability in each case should be based on the treatment of standards provided for similar or related items of cost. The allowability of the selected items of cost is subject to the general policies and principles stated in Part I of this Appendix. B. Allowable costs. 1. Accounting. The cost of establishing and maintaining accounting and other information systems required for the management of grant programs is allowable. This includes cost in- curred by central service agencies for these purposes. The cost of maintaining central accounting records required for overall State or local government purposes, such as appro- priation and fund accounts by the Treasurer-, Comptroller, or similar officials, is considered to be a general expense of government and is not allowable. 2. Advertising. Advertising media includes newspapers, magazines, radio and television programs, direct mail, trade papers, and the like. The advertising costs allowable are those which are solely for: a. Recruitment of personnel required for the grant program. b. Solicitation of bids for the procurement of goods and services required. c. Disposal of scrap or surplus materials acquired in the performance of the grant agreement. d. Other purposes specifically provided for in the grant agreement. 3. Advisory councils. Costs incurred by State advisory councils or committees estab- lished pursuant to Federal requirements to carry out grant programs are allowable. The cost of like organizations is allowable when provided for in the grant agreement. 4. Audit service. The cost of audits neces- sary for the administration and management of functions related to grant programs is allowable. 5. Bonding. Costs of premiums on bonds covering employees who handle grantee agency funds are allowable. Page 6 4/13/76 6. Budgeting. Costs incurred for the de- velopment, preparation, presentation; and exe- cution of budgets are allowable. Costs for services of a central budget office are generally not allowable since these are costs of general government. However, where employees of the central budget office actively participate in the grantee agency's budget process, the cost of identifiable services is allowable. 7. Building lease management. The admin- istrative cost for lease management which in- cludes review of lease proposals, maintenance of a list of available property for lease, and related activities is allowable. 8. Central stores. The cost of maintaining and operating a central stores organization for supplies, equipment, and materials used either directly or indirectly for grant programs is allowable. 9. Communications. Communication costs incurred for telephone calls or service, tele- graph, teletype service, wide area telephone service (WATS), centrex, telpak (tie lines), postage, messenger service and similar expenses are allowable. 10. Compensation for personal services. a. General. Compensation for personal services includes all remuneration, paid currently or accrued, for services rendered during the period of performance under the grant agreement, including but not neces- sarily limited to wages, salaries, and supple- mentary compensation and benefits (section B.13.). The costs of such compensation are allowable to the extent that total compensa- tion for individual employees: (1) is reason- able for the services rendered, (2) follows an appointment made in accordance with State or local government laws and rules and which meets Federal merit system or other requirements, where applicable; and (3) is determined and supported as provided in b. below. Compensation for employees engaged in Federally assisted activities will be considered reasonable to the extent that it is consistent with that paid for similar work in other activities of the State or local government. In cases where the kinds of • 46 • •