To calculate the indirect cost rate, the system looks at the total YTD indirect costs and calculates a ratio of those costs against the organizations YTD indirect cost base. For example, if at a given month the total YTD indirect costs were 75,100 and the total base for distribution was 420,050, that ratio would be 75,100/420,050 or .1788. (An example of an Indirect Cost base would be total direct charged salaries, allocated leave and fringe benefits.)
That ratio would then be applied to the base on all receiving elements. So if an element has a base amount of 94,000 the indirect cost amount charged to that element would be 94,000 x .1788 or 16,807. The allocated indirect cost amount will appear on line item 59700 Indirect Costs. This is a control account in the GMS software and cannot be changed.