Consumables on a UKRI Grant: Eligible Costs and the Audit Trail
A reagent bought on a research council grant is a directly incurred cost. That one classification decides what evidence must exist, when the order can be placed, and what an assurance review will ask to see.
When research materials are bought on a UKRI-funded grant, which cost category they fall into, what evidence a funding-assurance audit demands, and what commonly gets disallowed?
Consumables on a UKRI grant are directly incurred costs. UKRI says such costs are tracked against real spending, typically through invoices or timesheets, and it lists consumables among them [1]. Its terms define directly incurred costs as charged at the cash value actually spent and supported by an audit record [2]. A reagent order is therefore chargeable at what was actually paid, with the invoice behind it.
That one classification explains most of what follows: why an estimate is not enough, why the order has to fall inside the grant period, and why a finance office will ask for an invoice that names the project. This article describes the rules as they appear on UKRI's pages on 10 October 2026 and points to the documents that govern your own award.
The cost categories in one paragraph
UKRI funds research on a full economic costing basis, and its application guidance describes three groups. Directly incurred costs are tracked against real spending. Directly allocated costs are estimates, described as not directly auditable, and cover things like estimated staff time and research facilities. Indirect costs cover shared services such as finance and libraries and are entered as one total [1].
A consumable belongs in the first group. It is a specific purchase, from a specific supplier, at a specific price, and it can be traced to an invoice. That traceability is what makes it directly incurred rather than allocated.
Actual cost, actual invoice
UKRI's funding assurance page states that direct costs must be charged to awards on an actual cost basis rather than as a budgeted cost, and that an underlying audit trail must be maintained [3]. The page makes the point most strongly for staff time, but the principle applies to every directly incurred line.
For a consumable that means the amount charged to the grant is the amount on the supplier's invoice, not the figure in the original budget. If the price changed, the charge changes with it. If a line was budgeted generously and spent less, only the spend is charged.
What evidence to hold
UKRI's application guidance says that funded applicants must provide proof of their costs, and advises keeping receipts, invoices and contracts [1]. In practice the evidence for a reagent order is a short chain.
- The purchase order or requisition, showing the project code it was raised against.
- The supplier's invoice, in the institution's name, with the description, quantity and price.
- Proof the item was received, such as a goods-in record or delivery note with a date.
- Proof of payment, normally held in the finance system.
- The link between the purchase and the project's aims, if the finance office asks how the item was used.
The invoice is the document most often at issue. A card receipt or an order confirmation is not the same thing as an invoice, and the companion article on valid VAT invoices explains what a finance office needs. Most of the work is done by the purchase being raised correctly in the first place.
Timing: the grant period matters
UKRI's terms provide in RGC 4.2 that directly incurred and exceptions funds must not be used to meet the costs of an activity outside the grant period, with an exception in RGC 4.3 for the start. Expenditure may be incurred and charged to the grant from either the start date or the date the grant agreement was issued [2].
Two practical points follow. An order placed before the end date for materials that will be used after it is exposed: the cost relates to activity outside the period. And an order whose delivery or invoice falls after the end date may not be chargeable. Where an order is placed close to the end of a grant, ask the finance office how it will treat the date of order, delivery and invoice before committing.
What assurance reviews look at
UKRI's funding assurance programme focuses on the control environment at both pre-award and post-award stages and tests a sample of grants. Organisations may be asked for selected transaction lists [3]. Where weaknesses or ineligible expenditure are found, UKRI issues corrective actions [3].
The page does not define ineligible expenditure, and it does not list consumable-specific findings, so this article does not claim to know which reagent purchases have been disallowed. What it does say is that missing audit trails have been found. It reports gaps in the audit trail for directly incurred staff costs, and the same logic applies to any line [3].
UKRI's terms also entitle it to inspect any financial or other records and procedures associated with the grant, and require the institution to retain accounting information for the current financial year plus the subsequent six years [2]. Check the wording and the clause number in the version attached to your award.
Items near the equipment threshold
UKRI's application guidance lists equipment above £25,000 as a separate item and consumables and equipment up to £25,000 together [1]. The EPSRC page describes dedicated project equipment from £25,000 including VAT, and says equipment costing less than £10,000 including VAT is claimed under other costs, without saying which heading covers items between the two figures [4].
| Page | Figure shown | What it relates to |
|---|---|---|
| How to include costs in your application | £25,000 | Equipment listed as a separate item above this level; consumables and equipment up to it |
| EPSRC directly incurred costs | £25,000 including VAT | Dedicated project equipment from this level |
| EPSRC directly incurred costs | £10,000 including VAT | Equipment below this level claimed under other costs |
| Funding assurance programme | No figure | Actual-cost basis and audit trail apply to directly incurred costs |
The pages do not agree with each other on how small items are grouped, and they relate to different councils and dates. That is why the practical advice is to read the terms attached to the award, not a general summary.
A final habit is worth building. When a purchase is raised, record in one place what it is for, so that a reviewer reading the ledger two years later does not have to reconstruct the reasoning. A single line is enough: the item, the project aim it supports and the person who ordered it. UKRI advises keeping receipts, invoices and contracts as proof of costs, and a one-line purpose note makes those documents easier to interpret [1].
Who keeps the trail, and for how long
The grant holder is accountable to their institution, and the institution is accountable to UKRI. In practice the research finance office holds the ledger and the invoice, and the department holds the receipt and the link to the work. The best trail is one that does not rely on anyone remembering.
Record at purchase: the project code, the date of order, the date of receipt and the invoice number. Keep supplier documentation such as a certificate of analysis with the receipt, so that the purchase can be reconstructed from the file years later.
What to check next
Find the terms and conditions attached to your award and the council-specific guidance for your scheme. Read the clauses on costs charged outside the grant period, record retention and inspection. Then ask your research finance office how it handles orders close to the end date, and what it needs from a supplier's invoice.