Fiscal Office Management of Grant/Contract
Establishing Grant/Contract Account Number
Personnel Compensation from Grant/Contract
Time and Effort Reporting, see Policies&Compliance
Cost Sharing
Purchase Requisitions
Invoice Vouchers
Travel Expense Vouchers
Travel Using Federal Funds
What are F&A costs?
Financial Accounting on Grants and Contracts
OMB Circulars
Cost Principles of Educational Institutions (OMB A-21)
Allowable and Unallowable Costs
Cost Transfers
Pre-Award Costs
Financial Reporting to Funding Agencies
The principal investigator/project director of a grant usually serves as fiscal officer of the project. The principal investigator/project director must be familiar with institutional procedures and the granting agency requirements applicable to the specific grant. Responsibility for the expenditure of grants and contract funds rests with the fiscal officer. Over or improper expenditures of funds could result in embarrassment to the fiscal officer and the University. The Office of Research and Projects Fiscal Management works closely with the principal investigator/project director regarding expenditure of grant or contract funds.
The Office of the Research and Projects arranges for a new account and assumes responsibility for the administration of sponsored grant funds and assists the principal investigator in assuring that grant funds are expended in accordance with State, Federal and other regulations. ORP reports on the financial status of the account to the funding agency and copies are forwarded to the principal investigator/project director.
The principal investigator/project director has primary responsibility for the performance of the research/project in accordance with the proposal submitted. Because all factors affecting the project cannot be anticipated, changes in project procedures or objectives may be necessary. The requirements for reporting or obtaining approval for changes are usually specified in grants, contract documents, or other administrative information provided by the sponsoring agencies. Requests for changes in either the proposed project or budget must be approved in advanced by the Office of Research and Projects.
Most funding agencies require the submission of regular narrative/performance reports in addition to the regular financial reports during and/or after the completion of a project. The principal investigator/project director has the responsibility of completing the narrative/performance reports and for filing them prior to the agency’s deadline. A copy of each report must be sent to the Office of Research and Projects prior to its submission to the agency.
Please Note: All AIS forms referred to below can be found on the
Administrative Information Systems Form Page.
A grant/contract 6-ledger account is established when an award has been fully executed between the funding agency and the university. ORP will secure the appropriate 6-ledger account number from the Administrative Accounting Office and an AIS Request for Chart of Accounts/Accounting Flex field Values form will be generated and forwarded to the fiscal officer of the grant/contract account for signature. The dean and/or director of the fiscal officer’s unit must also sign the request form. A new fiscal officer will also be required to sign a Fiscal Officer Attestation Form. By signing the attestation form, the fiscal officer certifies that he/she will be responsible for fiscal and financial matters with regard to the account being established and any subsequent accounts that may be established under his/her name in the future. The fiscal officer is also assuring the university that he/she will comply with all policies, procedures and regulations of the university, State of Illinois and the funding agency. The required attestation form is to be signed and submitted once. The Forms are maintained on file by SIUE’s administrative financial units, and any subsequent new accounts established will only require that a Request for Chart of Accounts/Accounting Flex field Values be completed.
The signed Request for Chart of Accounts/Accounting Flex field Values should be returned to ORP. Approval signatures of the Director for ORP and the Provost/Vice Chancellor for Academic Affairs are also secured and the form is forwarded to Administrative Accounting for account establishment and activation.
From the date that ORP receives the signed request form back from the fiscal officer, it will normally take seven (7) to ten (10) working days for the account to be activated in the Financial Accounting System. You will not receive an official notice that the account is activated from either Administrative Accounting or ORP, but please feel free to call us if you need to check on the status of the activation of your account
Please Note: All employment forms referred to below can be found
on the SIUE Human Resources web site
The grant/contract fiscal officer is responsible for hiring personnel for the funded project. The following University forms are utilized for personnel who are to receive compensation from a sponsored grant/contract:
Application for Appointment
Change of Assignment, Title or Conditions of Assignment
Assistantship Appointments
Summer Appointments
Request for Civil Service Personnel
Request for Change of Status for Civil Service Personnel
If any personnel, other than student wages, are approved on a grant or contract, the following administrative procedures apply:
1. If a full-time employee of the University will be fully or partially assigned to the project, a Change of Assignment form must be completed.
2. If a new faculty, staff or civil service position is created, the proper hiring procedures and paperwork must be completed.
a. Professional personnel should be hired on a faculty/staff term appointment . Salaries to be paid from the grant/contract must be in line with current University Salary Schedules.
b. Secretarial and clerical personnel should be hired as Civil Service employees through the SIUE Office of Human Resources. Once informed about the specific help needed, the Office of Human Resources will send available applicants for interviews with the principal investigator/project director. When a suitable applicant has been found, the principal investigator/project director informs the human resources officer, who then completes the hiring procedure.
3. Graduate/Research Assistants. The qualifications for hiring and retaining graduate assistants should conform to the current requirements of the Graduate School. Conditions of appointments of students to assistantships in restricted (i.e., other than state appropriated accounts) accounts and in cooperative research units should conform to all other students in this category. Graduate students employed by non-state funds receive tuition waivers from the University. The papers for such appointments are first processed in the department and then routed through the offices of the appropriate academic dean, the Graduate School, the Office of Research and Projects, and the
4. Student Workers. All student workers must be hired through the Student Employment Office. Qualified applicants will be sent to the principal investigator/project director for interviews. When the desired student is found, the Student Employment Office must be notified and they will require the selected student worker to complete any necessary forms in the Student Employment Office. The completed forms are taken to the fiscal officer of the grant/project for signature and returned to the Student Employment Office for processing. The principal investigator/project director is responsible for insuring that timecards for students hired on their grant/contract are completed accurately and submitted on time every two weeks.
Upon completing any of the employment forms for faculty and professional staff hired or to be compensated by a grant or contract, the following is required:
The percentage (FTE) and dollar amount of compensation are recorded and should follow your approved budget outline. Faculty should seek assistance for facilitating this process from their school or college dean’s office.
These “employment” forms must be signed and dated by the employee and fiscal officer. The dean and/or department chair must also sign. The completed form(s) must be forwarded to the Office of Research & Projects with any accompanying documentation. The data is recorded by ORP and then forwarded to the Office of the Provost/Vice Chancellor for Academic Affairs for review and approval. The Office of the Provost/Vice Chancellor for Academic Affairs will then forward the information/paperwork to the personnel and payroll departments for further processing.
Federal grants and awards allow for a maximum of 100% effort. Therefore, if you are charging more than one federally sponsored grant (or any grant from which the sponsoring agency is utilizing federal funds) for one employee’s salary, the total percentage charged to all federal grants from which the individual is compensated cannot exceed 100%. This means that overload compensation cannot be charged to federally sponsored grants, contracts and subcontracts.
The Office of Human Resources payroll department will generate and forward to you payroll certifications on a monthly or semi-monthly basis. These reports reflect the payroll period, percent of compensation, total gross salary and applicable fringe benefits for each employee paid via the grant/contract and for which the grant/contract will be charged. These reports should be verified and signed by the fiscal officer and returned to the payroll department. Any discrepancies should be reported to the payroll department.
If there are any civil service employees who will receive compensation from a grant, the Change of Civil Service Status form must be utilized. The compensation to these employees who are paid hourly will be reflected on a Labor Distribution Report, which you will receive on a bi-weekly basis.
Please note that verification must be made that salary payments charged to grants/contracts are based on actual efforts. For hourly non-exempt/employees, actual effort is documented through use of time sheets and the Labor Distribution Report. For exempt employees, actual effort is documented through payroll certification reports.
All of the above mentioned forms can be secured from the Office of Human Resources web site. Federal and state tax withholding forms that are required for the Application for Appointment can be secured from the Payroll Offiice.
Posting of Graduate Assistantships positions are handled through the Office of Graduate Studies and Research. Please contact Cindy Fulton at extension 3164 with any questions you may have.
Cost Sharing means that SIUE and/or a third party is contributing support to your project. Cost sharing is usually on grants and not on contracts. The Grant/Contract Acceptance Routing Form has two columns under the heading Proposed Budget. The first column records the sponsor (funding agency) share of the cost of the project. The second column records the SIUE share of the cost of the project. The Grant/Contract Acceptance Routing form also records the sources of the cost share dollars (School or Department) and cost share account number.
Cost Sharing has three categories as outlined by the following Office of Management and Budget Circular which govern regulatory compliance of grants and contracts at institutions of higher education:
1. Mandatory Cost Share - The amount required by the sponsoring agency. This cost sharing is proposed by the grantee and is reflected in the award document or approved budget from the granting agency. Documentation to support cost share is required. The cost share is reportable to the funding agency and is subject to audit.
2. Voluntary Committed Cost Share - The amount proposed by the grantee, but not required via terms and conditions of the awarding agency. Once cost share has been proposed, it is considered committed and is auditable. Documentation to support cost share level is required. While this type of cost share is treated the same as mandatory cost share, reporting it to the funding agency is optional.
3. Voluntary Cost Share - Any over expenditures of a sponsored program for which the costs cannot be charged directly to the sponsor are considered voluntary cost share. The costs can be identified with relative ease as being associated with the program. These over expenditures are charged against unrestricted accounts and are tracked via "cost transfer" documents.
Please note that the National Science Foundation has a mandatory cost share of at least 1% of the total direct costs of a grant. NSF may require greater cost share, but if not stipulated in the award document, an institution must match at least 1% of the total award amount. (See NSF Grant Policy Guidelines).
When a proposal is submitted to a funding agency and university cost sharing has been committed to the project, fiscal officers must be aware that the level of cost sharing committed in the proposal must be met at the time the grant has been awarded. Regardless of whether cost sharing is required/mandatory or voluntary, if the proposal that was awarded for funding reflects cost share in the budget, proposal narrative and proposal routing and award acceptance form, then the level of cost sharing must be met. There are various methods of cost sharing, these are:
1. Salaries and Benefits
2. Equipment
3. University Non-Salary Expenses E.g. Tuition Waivers
4. Cash Match
5. Voluntary and/or In-Kind Services/Contributions
6. Unrecovered F&A (indirect costs)*
* Unrecovered F&A costs maybe utilized as cost share when the federally negotiated Facilities and Administration (indirect cost) rate is either not covered (paid) by the granting institution.
Under the Office of Management and Budget Circular A-21 and Cost Accounting Standards (CAS), any cost sharing is subject to audit and is reportable to the funding agency. Fiscal officers are required to submit a signed certification of university cost share or a memorandum to the Office of Research and Projects prepared not more frequently than quarterly.
The Cost Share Certification will identify and document the source of funds, transaction dates, brief description, dollar amount, account name and account number actually charged for the cost sharing. The dean or department heads from which the cost share dollars are being derived must also sign the certification. Cost Share Certification forms 
may be obtained from ORP.
Cost sharing of time and effort must be recorded through quarterly activity reports submitted to the Office of Institutional Research (see Effort Reporting). Percentage of effort, grant account number and grant title must be recorded in the appropriate areas on the activity report.
Always maintain documentation of cost share. Documentation includes copies of payroll certifications and personnel activity reports; invoice vouchers and accompanying documentation; internal charge records (fast copy, p-card purchases, post office charges, etc.) Remember Cost Sharing is subject to audit. Auditors will ask for documentation so make sure you maintain adequate records and that you do prepare certifications.
Purchasing Procedures:
Purchase of equipment and other current expenses (O.C.E.) are handled with purchase requisitions. The standard requisition is filled out by the principal investigator/project director and sent to the Office of Research and Projects, where it is reviewed and if approved, signed. It is then sent to the Purchasing Department, where a Purchase Order is prepared and sent to the vendor. On receipt of the item or service requested, an Invoice Voucher is prepared and submitted to Accounts Payable and payment is made from the proper grant/contract account.
Requisitions are also used to request payment over some length of time for contractual services. Such applications must be made in advance of such services and usually cover payments extended over several months or a year. Consultant’s services require a completed Consultant Agreement Form and a Independent Contractor Analysis Form to be attached to the requisition. Payment is ordinarily made on a regular basis (e.g. monthly, although payments need not be the same amount) upon receipt by Accounts Payable of an invoice from the vendor. Regular requisition forms are used in application, however, this type of requisition should clearly identify that the services are for a consultant, the period of performance: from_________to________, total payment amount not to exceed $_________. The source vendor should be listed on the form with their FEIN (federal employment identification number) or Social Security Number.
Confirming Requisitions are not allowable. Confirming requisitions are defined as payments after the fact, e.g. payments for services already rendered or for items already received. Only the Purchasing Officer and his/her assistants are authorized to commit the University for goods and services, when and as directed by their administrative supervisors. Commitments by any other member of faculty and staff are not legally binding on the University and may result in personal liability for the debt that is created.
All requisitions require that the grant account number and name be recorded in the appropriate fields provided. Only one source of supply may be used per requisition.
Based on the purchase requisition and issuance of a purchase order, payments for goods received and services rendered are made through the use of an invoice voucher. During the course of standard purchase this form is prepared by Accounts Payable. However, on various occasions the standard procedure can be bypassed and an invoice voucher (see AP Invoice Distribution) can be typed for direct payment to the vendor.
Invoice vouchers and purchase requisitions must be forwarded to the ORP office. ORP reviews the vouchers and requisitions. Those requiring additional approvals will be forwarded to the appropriate office prior to being sent to purchasing and accounts payable for processing. Please make sure that all vouchers and requisitions clearly have the name and account number of the grant in the appropriate area and are signed and dated by the fiscal officer.
According to the Travel Regulations issued by the Accounts Payable Office, “Only those incurred expenses relative to the transaction of official University business will be reimbursed, subject to applicable statutes, regulations, specific terms or restrictions in relation to externally sponsored grants and contracts, availability of funds, reasonableness, and prudence. All travel of any individual subject to these travel regulations shall be authorized and approved by the appropriate administrative officer prior to the beginning of the travel.”
Preparation and Submission of the Travel Expense Voucher
Preparation: Travel Expense Vouchers are to be used to request reimbursement for the following expenses related to travel:
- automobile mileage
- meals or per diem
- telephone calls
- tipping (portage)
- transportation and related costs
- lodging (if not directly billed to the University)
- registration fees less than $50.00 in amount
No requests for reimbursement should be made for expenses that are billed directly to the University. However, these items must be itemized on the Travel Expense Voucher and noted as “billed directly to the University – not included in amount to be reimbursed.” In all cases, receipts are required to be submitted with the voucher for any transportation, lodging, or miscellaneous expense that individually exceed $10.00. Additionally, in direct billing cases, copies of the billing must also be attached to the voucher.
If a registration fee is charged, a receipt or descriptive material with detail must be submitted highlighting what expenses are included. Meal expenses included in a registration fee will be deducted from the per diem allowance.
* The electronic forms listed above are available at www.siue.edu/AIS
Submission - The Travel Expense Voucher should be submitted within 10 days from the date of travel, or at the end of the month in which the travel occurred. All vouchers require Fiscal Officer signature and traveler signature before submitting the voucher to the Office of Research and for further processing. A case in which the Fiscal Officer is the traveler, additional departmental approval is needed before submission. Late travel vouchers require approval by the Office of the Provost.
Once ORP receives the Travel Expense Voucher, the dollar amount requested along with the purpose of travel are compared to the terms of the grant or contract for allowability. As long as the travel is within the guidelines of the granting agency and budgeted dollars remain, ORP will sign the voucher for propriety approval and forward the voucher to Accounts Payable for disbursement.
To assure that federal funds are expended to the benefit of American companies, recipients and sub recipients of federal grants and contract must utilize U.S. flag carriers to transport personnel and property when these costs are directly charged to the grant or contract. This is inclusive of travel to, from, between or within a country other than the United States, even if the cost of a foreign flag carrier is less and/or more convenient. The exception to this rule is if a U.S. carrier does not serve the point of origin, interchange or destination. In such cases, a foreign flag carrier may be utilized only to the nearest interchange point on a usually traveled route to connect with a U.S. flag carrier and/or if a U.S. flag carrier involuntarily reroutes a traveler via a foreign flag carrier and there is no availability of a U.S. carrier. Other exceptions, in general, may include travel to and from the United States, travel between points outside the U.S. and short distance travel whereby travel hours would be extended anywhere from 3 to 24 hours and/or would eliminate two or more aircraft changes while en route. Additionally, first class air fare is unallowable.
Vouchers and requisitions sent directly to purchasing and accounts payable will be re-routed to ORP for approval and may delay the turnaround time for processing.
The F&A (indirect ) costs of a project are those costs not readily identified with the project itself, but are incurred by the University, such as administrative expenses, utilities and library costs. The F&A cost rate is a ratio between the total indirect expenses and some direct cost bases, presently that base is Modified Total Direct Costs (MTDC).
The Office of Research and Projects Fiscal Management is required to negotiate for the University with the U.S. Department of Health and Human Services a pre-determined rate for each fiscal year that is binding upon all other Federal agencies and is recognized by most other funding agencies. In general, full recovery of F&A costs is provided on all federally sponsored research grants and on all National Science Foundation training grants. Public Service/Instructional and Training grants from other federal agencies may not allow full recovery and may be limited by a pre-determined rate based on total direct costs (TDC) or MTDC. Often times that rate is 8%.
AIS (Administrative Information System) Reports
Versus
FAS (Financial Accounting System) Reports
The implementation of AIS (Oracle Financials) has changed many of the business processes at SIUE. Currently all ledger accounts have been converted to the AIS system including Ledger 6 accounts (Grants and Contracts). These AIS ledger accounts use BP (Budget Purpose) numbers that start with the number 7 along with a string of other numbers that define the function and fund of the account. The report currently generated by AIS to fiscal officers is called the Funds Available Report. As fiscal officer of a grant, through the AIS system, you will be able to secure AIS Funds Available Report during the performance of your grant. When your new account is established you will receive a budget purpose number and a Ledger 6-account number. Ledger 6-account numbers can only be used for P-card transactions and payroll forms and transactions. Do not use the 6-ledger numbers assigned to your grant or contract for processing any and all of the following forms:
1. Invoice Vouchers
2. Travel Vouchers
3. Purchase Requisitions
Because of the AIS, the only form and process that has significantly changed for grants is the establishment of a new grant account. Once this form is generated and the Administrative Accounting office establishes the account, the BP number assigned will be reflected on the form. Your 6-ledger account number will be noted on the top right hand corner of the form. Please use and reference the 6-ledger account number for the processing of requests and any account inquiries related to payroll, internal billing charges and p-card charges/transactions.
A-21 Cost Principles for Educational Institutions
A-110 Uniform Administrative Requirements for Grants & Other Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations
A-133 Audits of States, Local Governments, and Non-Profit Organizations
Fiscal officers should be aware of treatment of costs as they apply to externally sponsored programs. The following information should be considered for all costs associated with the grant/contract.
BASIC CONSIDERATIONS
This is a brief outline of basic consideration for the treatment of costs for grants and contracts as reflected in the Office of Management and Budget Circular A-21. Please be aware that external auditors closely follow the guidance of the OMB Circulars.
1. Basic Consideration (Section C)
A. Cost charged to external grants and contracts must be REASONABLE
1. The nature and the amount reflect the action that a prudent person would have taken under the circumstances prevailing at the time of the decision to incur the cost.
a. Is the cost generally recognized as necessary for the performance of the grant activities?
b. Was the individual acting with good intentions and judgement considering their responsibilities to the University, the State and Federal government, and public at large?
c. Were actions taken with respect to the incurrence of the cost consistent with established institutional policies applicable to the entire institution including sponsored agreements/grants/contracts?
B. Cost charged to external grants and contracts must be ALLOCABLE
1. A cost is allocable if it is incurred solely to advance the work under the sponsored agreement/grant/contract.
2. A cost is allocable if it benefits both the sponsored agreement/grant/contract and other work at the university provided that a reasonable allocation method is used. Exception Provision: If equipment is specifically authorized under a sponsored project, then the full amount is assignable to the sponsored project regardless of the use that may be subsequently made.
3. Any costs allocable to activities sponsored by Industry (private sector), foreign governments or other sponsors may not be shifted to federally sponsored agreements.
4. Any costs allocable to a particular sponsored project may not be shifted to other sponsored projects in order to meet deficiencies caused by overruns or other financial considerations, to avoid restrictions imposed by law or by terms of the sponsored project, or for other reasons of convenience.
C. Cost charged to external grants and contracts must be CONSISTENT
1. Like costs must be treated the same in like circumstances.
D. Cost charged to external grants and contracts may have LIMITATIONS ON ALLOWANCE OF COSTS
1. Sponsored projects are often subject to statutory ceilings on the allowance of costs. When expenditures exceed the limit, the excess may not be recoverable under other sponsored projects.
OR WHAT YOU CAN OR CANNOT CHARGE TO YOUR GRANT
Allowable costs are costs that are eligible for reimbursement by the sponsoring agency. Allowable costs also have to be permissible by the university and permitted by the terms and conditions of the sponsoring agency. Unallowable costs are those costs that are not eligible for reimbursement by the sponsoring agency.
Costs must meet certain criteria to be considered allowable for reimbursement by a sponsoring agency. The Office of Management and Budget Circular A-21 states that costs should be (1) Reasonable; (2) Allocable and (3) Consistently treated. The costs charged to a sponsored project must also be allowable by the university via its policies and administrative procedures and by the sponsoring agency.
The following is a list of direct costs and activities that are allowable for reimbursement for sponsored agreements.
1. Advertising and Public Relations: if directly related to and necessary for the performance of the project;
2. Communications: local and long distance service and postage;
3. Personnel Compensation; must be reasonable and properly accounted for;
4. Equipment and other capital expenditures;
5. Insurance and Indemnification: those costs required for the sponsored agreement;
6. Labor Relations: employee publications;
7. Maintenance, Upkeep and Repair;
8. Materials/Supplies;
9. Memberships, subscriptions and professional activities; business or technical related;
10. Professional services: Consulting;
11. Reconversion costs: Restoration of facilities;
12. Recruitment costs: must be reasonable;
13. Rental of building and equipment: must be necessary for program operation;
14. Royalties and other costs for patents: unless patent is invalid or has expired;
15. Sabbatical leave costs; must follow university policy;
16. Severance pay;
17. Specialized Service Facilities: computer centers, etc.
18. Taxes: allowable only if university has to pay;
19. Transportation Costs: freight, postage, etc.;
20. Travel Costs: must be lowest commercial airfare;
21. Termination Costs Applicable to Sponsored Agreement: cost of unexpired leases; subcontract claims, etc.)
The following is a list of activities and costs that are unallowable for reimbursement for sponsored agreements.
1. Organized fund raising;
2. Lobbying;
3. Commencement and convocation;
4. General public relations and alumni activities;
5. Student Activities;
6. Advertising: not directly related to sponsored project;
7. Alcoholic Beverages;
8. Entertainment;
9. Fines and Penalties;
10. Memorabilia and promotional materials; allowable only if used for employee morale;
11. Moving costs if employee resigns within twelve (12) months;
12. First class travel costs;
13. Certain recruitment costs;
14. Cash donations to other parties;
15. Interest (some exceptions may apply);
16. Membership in social, dining and country clubs;
17. Communication costs associated with line charges;
18. Housing and personal living expenses;
19. Pre-agreement costs: unallowable unless pre-approved;
20. Scholarships and student aid;
21. Managing Investments Solely to Enhance Income;
22. Prosecuting Claims Against the Federal Government;
The nature and source of the award may stipulate other activities or costs that are unallowable.
POST AWARD REQUIREMENTS
During the performance of the sponsored project, it may be necessary to transfer costs to the grant from another source. Costs may be reassigned to a grant from another source if the transfer is to correct an error, the charge benefits more than one sponsored project and can be distributed based on the benefits received and, the sponsored project involved in the transfers are closely related.
Cost transfers are not permitted to reduce overruns from one sponsored project to another and cannot be made between unrelated grant/contract projects. Transfers cannot be made from restricted accounts with unexpended allocations to unrestricted accounts; and if the charges are unallowable by the terms and conditions of the receiving sponsored project. Most importantly, transfers are not allowable for mere convenience.
To request a transfer of costs, please notify ORP and we will forward you a Request for Transfer/Correction Form. Written justification and/or documentation supporting the transfer request should be attached to the form and returned to Research and Projects Fiscal Management. Transfers should be made in a timely manner following the original charge and will only be approved by ORP if they are processed within four months of the original posting charges.
Transfers that are unallowable and heavily scrutinized by auditors are:
1. Transfers of expenditures between two or more unrelated grant accounts;
2. Transfers of expenditures from a 2-ledger account to a grant account;
3. Transfer of expenditures to a grant account, which eliminates an overdraft in a ledger 2 or 4 account.
Steps to prevent the need for cost transfers on grant accounts:
1. Spend the grant budget first. If department funds are anticipated to cover a portion of the project (i.e. cost sharing), charge all expenditures to the grant account first. Use departmental funds only when the grant has been fully expended.
2. Directly charge all expenditures. Any expenditure, which relates to the grant project, should be charged directly to the grant account.
For example, OIT phone charges should be directly hitting the grant account instead of being transferred from a 4-ledger account.
Start accumulating project expenditures in a grant account as soon as possible. If expenditures are incurred prior to the award execution, ask for a pre-award account to be established.
Pre-award Costs are costs incurred prior to the start date of the grant/contract project as stated in the award notification. Pre-award costs must be “necessary and for the economical benefit” of the project. Pre-award costs must also be allowable under the terms and conditions of the award.
Pre-award costs may or may not be allowed on grants. Please refer to the “Special Terms and Conditions” in your grant application package, or give our office a call and we will look up the particular terms from your awarding agency. If there is no mention made in the terms and conditions for the grant, we will assume that prior agency approval will be required in order for pre-award costs to be allowable. Please be aware that all agency approval requests must be generated from the Office of Research and Projects. Should this action be required, please notify us and we will prepare the correspondence to the funding agency to seek this approval on your behalf.
Requesting a Pre-Award Account (Rush Procedure)
This step is advisable only if you have received written notification from the granting agency that your proposal has been awarded and/or you have received an award notification prior to the performance start date and the agency will allow pre-award costs. It will also be necessary for you to identify an unrestricted (4-ledger) account number to which costs can be transferred should, for some reason, the award not materialize.
TYPES OF PREAWARD COSTS AND PROCEDURES
Generally, if allowed, pre-award costs are expended within 90 (ninety) days prior to official award start date. These costs must be approved prior to actual spending. Pre-award costs must be documented in accordance with normal university policies.
a. When requesting a pre-award account number, please specify, in writing, that pre-award costs are expected to be incurred. Include approximate amount of expense, the cost categories (i.e. – supplies, equipment, etc.) and why pre-award costs are necessary for the project.
b. The Office of Research & Projects will review and notify the agency within 10 days of receipt of the request for pre-award cost approval.
Pre-award costs prior to 90 (ninety) days of the official award start date must be approved by the funding agency in writing prior to the incurrence of the costs. The Project Director/Principal Investigator should write a memorandum requesting approval to the Office of Research and Projects. The Office of Research and Projects will prepare a formal letter to the agency. We may require co-signature of the Project Director/Principal Investigator. The memorandum to ORP should include the following:
a. Approximate costs
b. Categories of costs
c. Earliest date of expected pre-award costs
d. Why pre-award costs are necessary (how they will benefit the project)
POTENTIAL IMPACT ON GRANTS
Pre-award costs may affect the begin and end date on grants from certain agencies. When pre-award costs are incurred, the new start date may become the date the earliest pre-award cost was incurred. When a project is less than 5 (years), there is no impact on the grant, however when the project is five years, the end date will be determined as five years after the earliest pre-award cost was incurred.
ORP prepares, monthly, quarterly and annual reporting on as required your grant and/or contract. When establishing the new account and setting up your grant records, ORP maintains a schedule on the due dates of your financial reports.
Copies of all financial reports submitted to funding agencies by ORP are copied to the fiscal officer of the grant.