Full economic costing

An outline of Full Economic Costing.

What is Full Economic Costing?

The University of Edinburgh uses the full Economic Cost (fEC) approach to prepare research project budgets for external funding applications.

The approach is based on Transparent Approach to Costing (TRAC) methodology, and has been mandatory for all Research Council applications and other Government departments since 2005.

The underlying principle of this methodology is to establish the true cost of a research project, and to use this to correctly inform the amount requested from funders.

TRAC website

Why is it important?

For many major non-commercial funders, including UKRI, the EC, and charities, pricing is prescribed to the University. The University measures the financial viability of a research project by how much of the cost is recovered from the funder and the contribution by the funder to overheads. Projects not reaching minimum fEC recovery and contribution to overheads levels require approval. For funding from industry, commerce, and public corporations, recovery and contribution to overheads require approval if less than 100%.

Categories of costs

Under fEC, there are three categories of costs:

Directly Incurred (DI)

Directly Incurred costs are project-specific (i.e. they arise as a direct consequence of the project taking place), actual, and must be auditable at the project level (e.g. supported by supplier invoices).

Directly Allocated (DA)

Directly Allocated costs are not project-specific (i.e. they are incurred whether or not the project takes place), and are estimated at project level e.g. investigator time, infrastructure technician time (where not DI), and Estates costs.


Indirect costs represent the costs of central and distributed services shared by other activities that are not project-specific e.g. Library services, Human Resources, and IT. They are calculated automatically.


View project costings and budget categories information


Information about the rules when applying for equipment in UKRI grants