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Glenn Hegar  ·  Texas Comptroller of Public Accounts

Reporting Requirements for Annual Financial Reports of State Agencies and Universities

Pass-Through Activity

Special Conditions
Research and Development (R&D)

R&D means all research activities (both basic and applied) and all development activities performed by a non-federal entity.

Research is defined as a systematic study directed toward fuller scientific knowledge or understanding of the subject studied. The term also pertains to training individuals in research techniques when these activities use the same facilities as other research and development activities and are not included in the instruction function.

If agencies are educating the public, they do not report the associated expenses as R&D.

Development is the systematic use of knowledge and understanding gained from research directed toward the production of useful materials, devices, systems or methods — including design and development of prototypes and processes. (Uniform Guidance [2 CFR 200.87])

R&D is a cluster in SEFA. Unlike all other clusters, the R&D cluster is not defined by a listing of CFDA numbers. Agencies must manually select the R&D tag when entering records to SEFA.

A verification screen displays in the SEFA web application to certify that the agency is aware the CFDA on the SEFA record is “tagged” as R&D when it belongs to another cluster. Verification is required before the final SEFA certification is completed.

Please contact your financial reporting analyst for any questions related to the R&D cluster.

Glenn Hegar
Texas Comptroller of Public Accounts
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