Step 5 - Award and Project Management

A. Getting StartedStep 5
B. Financial Management
C. Personnel Issues
D. Treatment of Facilities & Administrative Costs
E. Cost Sharing or Matching
F. Program Income
G. Time and Effort Reporting
H. Project Residual Funds
I. Cost Transfers
J. No-Cost Extensions

A. Getting Started

As soon as possible after notification that a proposal has been approved for funding, the Grants Accountants will create accounts for the award and schedule a meeting with the Principal Investigator(s) to review appropriate regulations and receive budget information for the new award.

  • The Principal Investigator’s most important responsibility is to pursue and complete the research, training, or public service described by the funded proposal within the specified time frame. The award document will outline the rules and guidelines that govern the project and specify the required technical and financial reporting. The Principal Investigator(s) must understand the award agreement and execute the work under these guidelines. The PI is also responsible for the programmatic direction of the research project and for initial authorization of all expenditures charged to the award budget. The Principal Investigator is ultimately responsible for making prudent use of the award by ensuring that expenditures are appropriate and directly relate to the budget and intent of the award and comply with applicable University, state, federal, and agency regulations.

    Before an externally funded research project is undertaken at Kennesaw State University, the Principal Investigator(s) and Co-Principal Investigator(s) must familiarize themselves with and agree to comply with all applicable policies on issues governing the conditions of the award including:

    Intellectual honesty, conflict of interest, and conflict of commitment policies apply to all projects and are covered in detail by Kennesaw State University’s Faculty Handbook Section 7. Regulations governing other issues should be consulted as necessary.

  • The Office of Research has the primary responsibility for providing the Principal Investigator(s) with financial information necessary to manage a sponsored project effectively and to ensure that the project complies with the financial terms of the agreement. The following list covers many of the activities included in that responsibility:

    • Issue invoices to funders
    • Prepare financial reports for the awarding agencies
    • Set up budgets and assign grants numbers
    • Refer the PI(s) to other University offices, as needed
    • Remain current on federal, state, and University policies related to grants
    • Train project directors and staff in research administration regulations and procedures
    • Serve as a liaison with auditors on financial matters
    • Implement approved budget revisions
    • Make all requests for no-cost extensions
    • Review and approve transactions
    • Initiate draw downs for sponsored programs accounts
    • Provide reports for project directors

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B. Financial Management

The Kennesaw State University Research and Service Foundation is the official recipient of grant and contract awards from government agencies and other sponsors and is required to comply with numerous rules and regulations. The Federal Office of Management and Budget establishes broad policies governing grant and contract financial administration. Every government agency that awards grants and contracts (e.g., the National Institutes of Health and the National Science Foundation) has its own regulations for administering grants and contracts as do most non-governmental sponsors.

Although the Office of Research grants managers or departmental or administrative personnel may assist the PI in carrying out administrative activities related to the grant or contract, the PI must provide guidance and oversight. The Principal Investigator best understands the scope of the project, the effort committed to it by faculty and staff, and the relationship of that project to other projects with which resources may be shared. Therefore, project directors are ultimately responsible for all direct costs that are charged to their grant. In this usage, direct costs are expenses that can be identified specifically with a particular sponsored project or expenses that can be assigned to a project with a high degree of certainty. Deans, directors, and department heads have a corollary responsibility for assuring that all sponsored programs conducted within their units conform to the applicable guidelines.

  • In order for costs to be allowable, all agencies require that they be reasonable, allocable, consistently treated, and permitted according to the terms of the award. When dealing with multiple grants or contracts, neither the availability of funds nor a project’s expiration date allows discretion in which project may be charged for a particular expense. All expenditures, whether for personnel, equipment, supplies, or other categories must be properly allocated to the grant or contract benefiting from the expense. The project’s director, not the project’s sponsor, is responsible for ensuring that expenses budgeted and/or charged to an award are allowable. Definitions of expense allowability are established by the University, the sponsor’s policies, the project’s Notice of Contract or Grant Award, and by federal policy. In general, to be allowable, costs must meet the following tests.

    Expenses must be reasonable:

    • Necessary for performance of the sponsored agreement
    • Understood as what a prudent person would do

    Expenses must be allocable:

    • The expense must benefit the grant directly
    • The expense must be necessary to the operation of the grant
    • The expense must be assignable to the grant
    • If the expense benefits more than one sponsored project, the expense should be allocated to the different projects in proportion to the benefits received by each

    Expense treatment should be consistent:

    • With policies applied to other federal and non-federal funds of the University
    • In treatment in like circumstances regardless of the funding source

    The expenditures must conform to any limitations or exclusions established by the University or in the sponsored agreement as to types or amounts of cost items. Any expense that does not meet all of these criteria cannot be charged to the externally sponsored project.

  • Most federal and non-federal sponsoring agencies issue policy guidelines defining acceptable expenses for their programs. Despite a great deal of commonality in content, variations in policy make it impractical to maintain a policy compendium. Individual agency or organization directives must be consulted for authoritative guidance; however, the following items are almost universally treated as unallowable expenses:

    • advertising (recruitment of study subjects may be allowed)
    • alcoholic beverages (unless the subject of the research project)
    • alumni activities
    • commencement and convocation expenses
    • entertainment expenses
    • personal uses of goods and services

    Project directors are ultimately responsible for tracking expenditures to prevent disallowable costs and overdrafts. If unallowable costs are erroneously charged to a sponsored project, the project director must notify an accounts manager immediately. If the issue is not resolved, the PI’s home department will be charged with disallowed expenditures and overdrafts.

  • Allowable costs of less than $5,000 can be paid with a University Procurement Card.

    • Responsibilities – The project director is responsible for verifying that all procurement card purchases charged to his or her grant are in compliance with the award or contract. Additionally, the project director is responsible for following the procurement card policies of the Office of Fiscal Services.

    Repeated violations of these policies will result in the revocation of procurement card privileges.

    • Invalid or Unauthorized Expenditures – Project directors are responsible for all charges booked to their project with procurements cards regardless of who holds the card. If invalid or unauthorized purchases are charged to a grant using a procurement card, the project director’s college or department budget will absorb the expense. Charges that cannot be paid by the college or department (i.e., expenses cannot be paid with state funds) will be the responsibility of the project director. The Office of Fiscal Services will create a receivables account in the project director’s name to collect funds that cannot be absorbed by the Director’s home department of college.
  • Requisitions for goods and services are created through eProcurement (ePro), a module in PeopleSoft Financials for University System of Georgia institutions. ePro requisitions must be approved by the project director. This approval certifies that the cost is allowable and solely allocable to the grant. ePro requests must include an itemized receipt or invoice. Consult the ePro Reference Materials for answers to many questions.
  • The Office of Research and the Office of Fiscal Services are responsible for establishing and maintaining accountability for equipment acquired under grants, contracts, and subcontracts for sponsored programs in accordance with sponsoring agency directives and University policy. The acquisition cost threshold for what is considered non-expendable equipment may vary among sponsors. Most federal sponsors use the definition contained in OMB, 2 CFR, i.e., an acquisition cost of $5,000 or more per unit or the institution’s definition, whichever is lower. The threshold amount at Kennesaw State University is $5,000. If your project includes funds for equipment, please contact your grants manager for assistance in obtaining quotations (bids) from vendors and placing orders. Office of Procurement oversees KSU’s purchasing policies. Questions about these policies or equipment purchased on a federally sponsored award should be directed to the Office of Research.

    • Receiving Requirements – The Principal Investigator is responsible for assuring that equipment received is as ordered and in good condition. Any discrepancies or damage should be immediately reported to the Procurement Department.
    • Maintenance – Responsibility for maintaining physical control of all equipment acquired under an award and safeguarding it against loss, damage, or unauthorized use rests with the Principal Investigator. Subcontractors or sub-grantees are also responsible for compliance with equipment policies and requirements as described in sub-award documents.
    • Equipment Transfers – Equipment owned by the federal government or other sponsors is subject to transfer to another institution when approved and directed by the sponsor agency. A request for transfer of such property can originate with a researcher transferring to another institution and requiring the equipment in the pursuit of continuing research or with the sponsor agency itself. A transfer originated by a faculty member requires the advance approval of the appropriate department head, dean, Vice President for Research, and, in some instances, the federal or sponsor agency. Agency- originated disposition or transfer instructions do not require such approval. However, if agency-directed or contemplated transfers are likely to impair continuing research or training projects at the University, such considerations should be brought to the attention of the agency promptly through the Office of Research in an attempt to dissuade the agency from making the transfer. Much of the property acquired on research or training awards becomes University (State of Georgia) property upon acquisition or by subsequent vesting of title. Disposition or transfer of such property is subject to University and state policies.
  • As budgeted in the project’s award, travel expenses are allowable if they are in direct support of the project. All travel reimbursements, both to University and non-University employees, are subject to state and University travel policies except when more restrictive policies and limitations may be imposed by a specific award. Federal travel regulations apply when required by federal awards. For more information refer to the section on Travel in Step 2 (under Budget Elements).
  • Costs of professional and consultant services rendered by persons who possess a special skill and who are not officers or employees of the University System of Georgia are allowable.

    • Hiring – The Office of Research and the Office of the Vice President for Operations are the only units on campus authorized to execute an agreement with consultants when sponsored funds are to be used. Requests to hire a consultant require the Consultant or Contractor Form (Sponsored Funds Only). Requests must be approved by the Office of Research prior to a consultant commencing work on a project.
    • Named Consultants – If a consultant is not specifically named in a grant and the agreement is $5,000 or greater, but a description of work is stated in the grant, then a Sole Source Form must be completed by the project director and submitted with the Office of Research Consultant or Contractor Form and a resume.
    • Payment – To initiate payment of a consultant/contractor, project directors should consult with their grants manager for assistance.
  • Lecture and performance agreements are used when a guest lecturer speaks during a class, workshop, seminar, etc. Requests to hire a lecturer should be made using the Lecture/Performance Agreement Form and Instructions. Requests to hire a lecturer must be fully approved prior to providing any service. Active Kennesaw State University employees cannot be paid as a lecturer.
  • If your grant has an amount budgeted for on-campus photocopying, the project director should contact Copy/Print Services at KSU to request a copy code be created for charges to the grant. The project director must provide the grant name and grant speed chart number for the code to be established. At the close of the grant award, the project director is responsible for notifying Print Copy Services to terminate the charge code. If this code is used beyond the grant end date, the copy charges will default to the project director’s home department.
  • Most awards are cost-reimbursable. However, under some circumstances, a fixed-price contract may be negotiated. In those cases where an agreement is a fixed-price contract (generally research institutes and centers), provisions must be made by the Principal Investigator and/or department or center having primary responsibility for the project to cover any overdrafts or excess expenses.
  • Post-Award changes to project budgets require prior approval. Requests for changes are made with the Office of Research’s Administrative Action Request Form.
  • All grant expenditures must be posted or encumbered on Kennesaw State University’s financial ledgers prior to the grant end date.

    • Last Month of Award – During the last 30 days of the award Project Managers should notify their grant accountant of any purchases (procurement card, ePro requisitions, travel, etc.) incurred. Notification should be provided immediately to assure that the expenses are posted to KSU’s ledgers prior to the award end date. In general, supplies and materials purchased for the project should be consumed by the award’s end date. Residual inventories of supplies valued at more than $5,000 are subject to specific requirements for their handling.
    • Grant-Specific Deadline(s) – You must reference the individual grant/contract for grant- specific deadlines set by funding agencies (i.e., narrative reporting, etc.). The Office of Research is responsible for all fiscal reporting. Please contact the Office of Research if you have any questions about these deadlines.

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C. Personnel Issues

  • The following sections provide a brief overview of the process and rules for hiring both students and non-student employees. Please contact your Grants Manager or the KSU Human Resources office for additional information and assistance.

  • Salaries and wages are allowable as a direct cost to the extent that they are reasonable and conform to established University salary and wage policy.

    General Policy – All personnel involved in a sponsored project effort, whether faculty, professional staff, clerical staff, or students (research assistants), must be paid in accordance with University and state guidelines. Budgeted amounts contained in a proposal do not in any way supersede University policies. The salary and wage categories and job or position classifications on sponsored projects must be congruent with those established for other employees of the University. Salary rates and increments are, therefore, subject to the regulations applied to all other University employees of the same classification. Exceptions may result in audit disallowances.

    Summer and Maymester Payroll – Summer and Maymester pay is subject to requirements different from those during the remainder of the academic year.

    1. The project director is responsible for ensuring his/her department chair submits to Academic Affairs the faculty names, amounts, and grant account for those that are budgeted to be paid Maymester and Summer payroll from externally funded grants and contracts.
    2. Maymester payroll is charged to the current fiscal year (ending June 30). Maymester payroll is paid for work completed during the month of May, not June.
    3. If work is done during the summer months (June and July), faculty should be paid through summer payroll, which posts in the next fiscal year (which begins July 1). Thus, the grant end date should carry into the next fiscal year in order to support the processing of summer payroll through the award.
    4. In addition, a Time and Effort report is required as backup documentation for any Maymester or summer payroll charged to federal sponsored awards.
    5. For specific Kennesaw State University submission deadlines for faculty payroll, please contact the Office of Academic Affairs. For KSU Maymester or summer payroll check dates, please contact the Office of Payroll Services.
  • Personnel paid from a sponsored program account receive the same leave benefits as personnel paid from other University funds. Staff and fiscal year appointees are encouraged to utilize accrued vacation before the program’s termination date. If the contract or grant does not have sufficient funds to pay the accrued vacation, it is the responsibility of the employing department to provide the necessary funding. The project director must ensure that these employees accurately report their vacation time prior to the project’s expiration.
  • A training stipend is an allowance granted to an individual to assist with his or her living expenses during a period of training (e.g., while attending a workshop or conference). Training stipends are not considered compensation for the services expected of an employee. Payment to KSU faculty or staff for work on a grant or contract is paid as salary, not as a stipend.
  • A training stipend is an allowance granted to an individual to assist with his or her living expenses during a period of training (e.g., while attending a workshop or conference). Training stipends are not considered compensation for the services expected of an employee. Payment to KSU faculty or staff for work on a grant or contract is paid as salary, not as a stipend.
  • The Board of Regent Reduction in Force (RIF) Policy applies to the following contingencies:

    • Grant expiration, budget reduction, and/or funding changes;
      i.e. grant funding is scheduled to expire and will no longer be available to support the salaries for the position
    • Programmatic changes that result in the elimination of or decrease in services;
      i.e. enrollment in a program is low and can no longer support the salaries for the positions servicing the program
    • Reorganization that results in a shifting of responsibilities or elimination of certain tasks altogether;
    • Business process changes that redistribute work so that a position is no longer required; and
    • Other organizational changes that might prompt an adjustment to staffing needs.

    Note that the RIF Policy specifically prohibits its use to address employee performance issues.

    The hiring manager is responsible for notifying the KSU Human Resources office at least 90 days before funding for a position is scheduled to end. This timeline applies even when there is the potential for the funding to be extended. If funding is continued, the Reduction in Force Policy process can be halted.

    The KSU Human Resources office will assist the hiring manager in following the guidelines of the RIF policy, including appropriate notification to the employee in writing. Adhering to this policy limits the amount of liability the University could face during the separation process.

  • Salaries and fringe benefits of administrative and clerical staff may be charged as direct costs if a project requires the services of administrative and clerical staff beyond the normal level provided by departmental administrators paid from a department account. The total cost of these services may be budgeted, charged, and reported as a direct cost to a sponsored project when all of the following conditions apply.

    • The specific type and nature of the services are not provided by the departmental administration account.
    • The services are required by the project’s scope.
    • The cost can be accurately identified to the project.
    • The approved project budget narrative clearly describes the need for the service. For example, charging administrative and clerical salaries and fringe benefits as a direct charge to a sponsored project may be permissible for projects requiring:
      • Extensive data accumulation, statistical analysis and entry, database management, surveying, tabulation, cataloging, or literature review.
      • The preparation and production of manuals and large reports or books. (This does not include routine progress and technical reports.)
      • Extensive travel and meeting arrangements for a large number of participants, such as conferences and seminars.
      • The management of a project at locations geographically inaccessible to normal departmental administrative services, such as research field-sites remote from campus.
      • Special research security services at a level not normally provided by campus security.
      • Large, complex programs (such as general clinical research centers, primate centers, environmental research centers, engineering research centers, and other federally sponsored projects) that entail assembling and managing teams of investigators from a number of institutions or units. National Institutes of Health R01 Grants do not qualify as complex programs.

    These examples are not an exhaustive list, nor do they imply that direct charging of administrative or clerical salaries would always be appropriate for the situations illustrated in the examples. Furthermore, separate projects cannot be grouped together to meet any of the criteria listed above. The project director must support and justify in the proposal all direct costs to be charged to a sponsored award and are, therefore, strongly advised to discuss such costs with the Office of Research staff.

  • If a grant supports release time, the project director is responsible for notifying their Department Head to schedule the release time in accordance with the approved grant budget. The project director should give the appropriate PeopleSoft Payroll Combo Code (found on the Grant Overview Sheet) to his/her Department Head along with the amount to be charged during the semester.

    The following rules govern course releases and reassignments:

    • The project director(s) is responsible for notifying their Department Head to schedule release time during Fall or Spring Semester. The cost of the reassignment is charged to the appropriate grant or contract during the semester in which the course release is taken.
    • The Business Manager(s) is responsible for working with the appropriate person(s) within their college and the Academic Fiscal Affairs Officer in Academic Affairs to process any budget amendments to redirect the funds for the college.
    • A Time-and-Effort Report will be required as backup documentation for any course releases and/or redirects charged to federally sponsored awards.

    Summer Semester is handled differently than Fall and Spring.  The project director(s) should let their Department Head know that they are to be paid from a grant during Summer Semester.  This planning usually occurs early during Spring Semester. It is the project director's responsibility to verify that anyone who is to be paid from his/her grant during the Summer Semester is on the Summer Payroll List. Questions about summer pay should be directed to Department Heads or Academic Affairs Fiscal Affairs Officer.

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D. Treatment of Facilities and Administrative (Indirect) Costs

  • Indirects/Facilities and Administrative (F&A) costs earned on awards are shared between the Kennesaw State University Research and Service Foundation (KSURSF) and KSU. Indirects retained by KSURSF are used to defray audit, banking, and other administrative costs it incurs, and are also used to support research and intellectual property development.

    Each award is tied to the Principal Investigator's (PI's) department. University indirects are distributed as follows:

    • 50% - Dean of responsible college (the PI's home college) to share with department(s) and investigator(s)
    • 30% - Office of the Vice President for Operations
    • 20% - Office of the Vice President for Research
  • The Office of Research transfers earned indirects to the respective dean’s indirects account upon payment to the University by KSURSF. Business Managers receive email notification indicating that the indirects journal has been posted. Business Managers may, upon approval of the Dean, transfer funds from the Dean’s indirects account to an indirects account established under a department within the college; funds cannot be transferred to a regular state departmental account.

  • When faculty/staff from more than one college collaborate on a proposal, the question, “Who gets the indirects?” often arises. The distribution of the PI college share of indirects is decided by the project investigators and their deans, not the Office of Research. Although projects often have multiple investigators, only one is named the PI and is the contact for the Office of Research and the sponsor. The collaborating investigators decide who will serve as the PI.

    Where more than one college is involved, it is advisable to have a written plan signed by the respective investigators and deans, and possibly also the department chairs and college business managers. This should be done at the proposal stage.

    Once indirects are earned, the Office of Research will post them as listed above. The college business manager will be responsible for transferring the agreed-upon amount(s) to the collaborating college(s)/unit(s).

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E. Cost Sharing or Matching

  • Once a sponsor accepts a proposal containing cost sharing, it is considered binding upon the University and the University accepts the same fiduciary responsibilities in expending these funds as for the funds from the sponsoring agency. Written approval from the sponsor is required to change the matching or cost sharing commitment. The Principal Investigator is responsible for ensuring that any cost sharing commitments are met and that all necessary documentation is provided to the Office of Research. Cost sharing or matching expenditures incurred or services rendered must occur during the period of the award and are subject to the same sponsor guidelines and regulations.

    If, at the time of award, the sponsor’s level of support is less than the University’s originally proposed budget, any original matching commitments offered by the University or external entities on behalf of KSU should be reconsidered for possible reduction or elimination from the award in consultation with the Office of Research. If conditions arise that make it impossible to satisfy the matching requirements, the Principal Investigator should inform the Office of Research immediately. The Office of Research is responsible for renegotiating any reduction in the level of matching required by the sponsor. The Principal Investigator is responsible for eliminating any matching shortfall requirements.

    NOTE: A signed cost sharing commitment form must be on file prior to the expenditure of any project funds.

  • The Office of Management and Budget (OMB) Circular A-110 definitions of cost sharing and matching contributions require that they meet all of the following criteria:

    • Are verifiable from the records of the Principal Investigator.
    • Are not being included as contributions for any other federally assisted project or program.
    • Are necessary and reasonable for proper and efficient accomplishment of project or program objectives.
    • Are allowable under the applicable cost principles.
    • Are not paid by the federal government under another award, except where authorized by federal statute to be used for cost sharing or matching.
    • Are provided for in the approved budget when required by the federal awarding agency.
    • Unrecovered indirect costs may be used as cost sharing or matching only with the prior approval of the federal-awarding agency.
  • To assist the Principal Investigator in capturing the cost sharing information in accordance with University requirements, the Office of Research will provide guidance.

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F. Program Income

  • Program income is the gross revenue earned from activities for which the direct costs have been charged to a grant (or sub-grant) or counted as a direct cost toward meeting a cost sharing or matching requirement of a grant.

  • In addition to other possible sources, program income includes:

    • Fees for services such as laboratory drug testing or conference fees
    • Proceeds from sale of equipment or supplies purchased or constructed with grant funds if title does not vest in the grantee
    • Usage or rental fees charged for use of facilities or equipment such as computer use charges
    • Funds generated by the sale of commodities such as sale of tissue cultures, cell lines, or research animals
    • Third party patient reimbursements for hospitals or other medical services where such reimbursement occurs because of the grant supported activity
    • Patent or copyright royalties
  • The Office of Research should be contacted at the time it is recognized program income will be generated. The Office of Research will assist in establishing the proper method of accounting for the income. Because program income has the same accountability requirements as federal grant funds, the Office of Research will select a mechanism that will account for program income in accordance with federal requirements. Program income, in accordance with specific agency requirements, will be reported to the sponsoring agency on financial reports that are prepared periodically.

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G. Time and Effort Reporting

Kennesaw State University uses an after-the-fact system of documenting time and effort charged to federal grants and contracts. The University’s payroll distribution system meets the United States Office of Management and Budget (OMB) standards. OMB, 2CFR, Part 200.430, paragraph (i) states that charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed.

Grant Accounting prepares and distributes effort certification reports via email to the PI for salaries and wages charged to federally sponsored grants and contracts either as a direct charge or as a cost shared commitment. These reports are based on payroll records. KSU distributes effort reports per semester.  

The recipient of an effort report should certify his/her own effort report unless the employee is no longer available to certify.  In this event, the Principal Investigator, or person with direct knowledge of the employee’s workload, must certify the report.  Grant Accounting accepts original signatures returned via campus mail and scanned reports via email. 

For questions regarding time and effort reporting, please contact Grant Accounting at

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H. Project Residual Funds

  • A residual balance is unobligated money remaining in a fixed-price sponsored project after closeout. Cost reimbursement grants and contracts cannot have residual balances. Projects that have a balance after the period of performance has ended may be permitted to carry that balance forward if allowed by the sponsor under the specific terms of the project.

  • Before KSURSF can close out an award, the project director must confirm in writing that all deliverables have been met, all activities have been completed, all program reports have been submitted to the funding agency, and all project-related expenses have posted to the account.

    If there is a residual balance at closeout, after ensuring that the appropriate F&A rate or management fee has been applied, KSURSF will transfer the residual funds to a KSURSF department or center operating account. These accounts do not lapse. Funds in these accounts must be used to support KSURSF’s mission.

  • If the award was made to the University (not the KSU Research and Service Foundation) the project director has the time remaining in the current fiscal year and one additional fiscal year to spend the residual funds. The Office of Research will notify the project director when one fiscal year remains in which to expend the residual balance. Any funds remaining in the account at the end of the period will be transferred to the project director’s home department budget and will become lapsable at fiscal year-end. Grant accounts with a residual balance of less than $100 will automatically be transferred to the departmental account at project closeout.

    Residual funds must be used for a purpose that is related to the project or to enhance programs to which the project is tied within the director’s home college. Residual funds may be used to support the project director’s professional development or for the professional development of other faculty members in the director’s home college. The State of Georgia’s rules and regulations apply to the use of residual funds.

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I. Cost Transfers

  • A cost transfer occurs when costs are moved from a non-sponsored project account to a sponsored project or from a sponsored project to any other account. Cost transfers receive careful scrutiny by sponsors, especially federal government contracting officers and auditors, and are exceptional activities that should not occur frequently.

  • The following accounting activities are not defined as cost transfers.

    • Initial Transfers -- Initial transfers of charges for supplies or services from an inventory account, cost center, or other similar operations in accordance with established accounting procedures.
    • Corrections of Processing Errors -- Corrections of processing errors that occur within the Business Services accounting systems such that when the correction is made, the accounting records are in agreement with the documentation that authorized the change.
  • Cost transfers required to correct errors or to achieve proper, consistent, and equitable distribution of costs to sponsored-projects are allowed, provided adequate justification for the change is furnished and necessary approvals that certify the accuracy of the charges are received. Corrections must be made promptly after the error is discovered. A cost transfer made within 30 days after the posting date of the transaction requiring a transfer will be considered timely. In other exceptional instances, cost transfers may be required after the 30-day period. The transfer must be supported by a written explanation of how and why the error occurred and a certification of the correctness of the accounting change. An explanation that merely states that the transfer was made “to correct error” or "to transfer to correct project" is not sufficient. The Office of Research will approve or disapprove the request for a cost transfer when all requested documentation and justifications have been provided.
  • Cost transfers of personal service expenses (salary or fringe distribution changes) requests require adequate supporting statements that clearly indicate that the costs being moved to a project are directly related to the project scope and allowable by the project budget and have been incurred in a timely manner to benefit project activities. In addition, a Time and Effort report will be required as back-up documentation prior to any personal services reallocations for federal awards. Justification must always consist of more than simple statement such as “to correct an error” or “posted to the project number.” While such statements may be correct, justification must be considered adequate to convince a sponsor or auditor of the accuracy of the charge to the sponsored project. The Office of Research approves the cost transfer as to accuracy of the accounting, the proper authorization, and the adequacy of the documentation.
  • Costs may not be shifted between accounts or from one budget period to the next solely to cover cost overruns. Cost transfers based on funding considerations are prohibited (i.e., cost transfers cannot be done to expend remaining funds). The intentional “parking” of charges on a restricted grant or contract pending transfer to another grant or contract account upon its funding is unallowable. Parking of charges for any reason is considered a misuse of grant funds.

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J. No-Cost Extensions

Should you be unable to complete your project by the end date, you may be allowed to request a no-cost extension. Extensions are not appropriate when the sole purpose is to spend down remaining funds. Most federal agencies allow the institution to have a one-year no-cost extension. For other agencies, prior approval is required from the funder.

Requests for a no-cost extension must be sent to the Office of Research at least 30 days prior to the project end date using the Office of Research’s Administrative Action Request Form.

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