New UVM Policies and
Procedures Affecting Grants:
Advance Accounts, Cost Transfer,
and Residual Balance
Sponsored Projects Training Program
December 8th, 2011
Beverly Blakeney, Ruth Farrell, Michael Meunier
Welcome
 An
introduction to the presenters
and the topics.
 Time line and next steps for
implementation of these policies
and procedures.
Sponsored Projects Training Program
Learning Objectives
Increase awareness of upcoming
changes in cost transfer policy and two
new, separate procedures that will soon
be in place.
 Help participants understand new
operational practices that they will
have to plan for.

Sponsored Projects Training Program
Reminder – the Cost Principles
Allocable
 Allowable
 Reasonable
 Consistently charged

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Advance Account Procedure
a.k.a Guaranteed Funding
Advance Account – What?

Creation of a sponsored project chart
string before an award document is
received or accepted from the sponsor
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Advance Account – Why?
Need to start the work
 Allows PIs and Departments to record
and track expenditures in appropriate
chart string
 Reduces salary and non-salary cost
transfers
 Eliminates re-work for principal
investigators, department administrators,
and staff in central offices

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Evaluating Risk
Written confirmation from sponsor
 Sponsor’s history with UVM
 Negotiation risks

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What needs to be in place? –How?
Department or unit must assume risk
 Written confirmation from sponsor
 Proposal must be fully routed and
approved
 Regulatory requirements must be satisfied

◦ IACUC, IRB, IBC, COI
Competed request form
 Modified budget (optional)

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Limitations
Request 90-180 days
 Can limit dollar amount
 Any limitations of the sponsor

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Responsibilities
PI – initiating request, collecting required
documents, spending within the constraints of
AA
 Unit – submit request, assumes fiscal risks,
monitors, ensures expenses and encumbrances
conform to advance account duration
 VP or Dean of unit – assumes financial risk
 SPA – advise on potential risk, confirm all
regulatory approvals are obtained, approve AA
and establish chart string, provide training

Sponsored Projects Training Program
What happens next?
Award received and accepted
 SPA completes the set up process
 Billing can occur
 Or – no award is received charges need
to be moved

Sponsored Projects Training Program
Resources


Monthly report
PS Query
◦ UV_GM_FINDINGAWDTHRUREFAWD
◦ It can be run on an ad hoc basis, by department
number, award number, reference award number
or wide open using wildcards. The search fields
are not case sensitive.
◦ Can be used to locate an award if you only know
the sponsor's award number
◦ Can be run at any time to identify all advance
accounts by department or for the whole
university
Sponsored Projects Training Program
Questions?

.
Sponsored Projects Training Program
Cost Transfers Involving
Sponsored Agreements Policy
- Revision Update Michael Meunier
Cost Accounting Services (CAS)
1:30-2:30
Memorial Lounge
December 8, 2011
Cost Transfer Policy Topics

Policy Review Process

Cost Transfers at UVM

Key Policy Changes

Cost Transfer Form
Policy current status: Campus wide policy comments on this policy
are currently being considered.
Sponsored Projects Training Program
Cost Transfer Definition
A cost transfer is the assignment of an expense
to a sponsored agreement that was initially
recorded elsewhere in the University’s general
ledger.
◦
Removal of an expense from a sponsored agreement to a nonsponsored chart string will continue to require an explanation
and appropriate approvals.
Sponsored Projects Training Program
Cost Transfer Policy – Review Process

Profiled university cost transfer activity

Reviewed Grant Lifecycle Committee Report (August 2009)

Benchmarked other University policies/procedures

Analyzed key sponsor specific regulations
◦ HHS, NIH, NSF, Federal Formula grants

Reviewed external audit reports and recommendations

Solicited feedback from Academic Business Managers
Sponsored Projects Training Program
Cost Transfers at UVM
UVM has significantly more cost transfers,
particularly late cost transfers, than similar
Universities
• Allowability concerns (red flag to auditors)
• Inefficient use of University resources
• Fiscal management of sponsored agreements
Sponsored Projects Training Program
Cost Transfer Policy – Key Changes

Accountability statement

Minimizing cost transfers

Timeliness

Approvals

Unallowable Expense Transfer Authority
Sponsored Projects Training Program
Key Policy Changes - Accountability
All University personnel are expected to be aware of and
comply with this University policy and the principles and
requirements listed below.
Confirmed violations will result in disciplinary action. In
some instances, civil claims and criminal charges may also
result.
Sponsored Projects Training Program
Key Policy Changes – Minimizing Cost Transfers
• Charge only allowable expenses to sponsored
agreements
• Utilize advance accounts
• Minimize posting expenses to department suspense
• Quarterly meetings with PIs (Effort, Non-salary expenses)
• Submit timely and relevant salary distribution changes
• Reallocate PurCard expenses within University deadlines
Sponsored Projects Training Program
Key Policy Changes – Timeliness
1) Identifying errors in a timely manner
• Monthly verification of financial transactions (PMBR)
• Department Suspense Review
2) Timely Cost transfer Submissions
• < 90 days after original accounting date (GL)
• Salary transfers included (no more 30 day grace period)
• Department submission date is official submission date
Note: NIH only allows cost transfers within 90 days after the
error was discovered.
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Key Policy Changes – Justification / Documentation
Justification
• Detailed explanation
• Independent reviewer understanding
• Subject to audit (No email threads!)
Supporting Documentation
• Current Salary Distribution Form
• Original Additional Pay Voucher (APV)
• Project monthly budget report (non-salary xfers)
• List of business meal attendees
• Certified Effort Report w/ changes
Sponsored Projects Training Program
Key Policy Changes – Untimely Submissions
Untimely Cost Transfer Submission (> 90 days)
◦ Original General Ledger accounting date
◦ Cost transfer requests > 90 days after the error
is discovered is unallowable (NIH policy)
Additional Written Justification Required
◦ Lateness
◦ Extenuating circumstances
◦ Corrective action to prevent future occurrences
Sponsored Projects Training Program
Key Policy Changes – Required Approvals
Department Approval
• No one person has complete control over all aspects of the
cost transfer submission (Preparer, Approver)
Timely Cost Transfer Central Office
•
•
Cost Accounting Services (CAS)
Sponsored Project Administration (SPA)
(< 90 days)
Salary/Wages
Non-Payroll
Untimely Cost Transfer Request
(> 90 days)
• Principal Investigator signature is required
• Vice President signature is required
Sponsored Projects Training Program
Key Policy Changes – Transfer Authority of
Unallowable Expenses
Non-Payroll Expenses
• SPA has authority to transfer expenses to department general
fund account
Uncertified Payroll Charges
• CAS has authority to transfer non-certified payroll expenses to
the employee’s home department general fund chart string.
Note: Sponsored Projects Expense Transfer policy will be
eliminated.
Sponsored Projects Training Program
Cost Transfer Procedure & Form
Required for all cost transfer submissions
•
•
•
•
Salary Distribution Changes
Additional Pay Vouchers
Wage Transfers
Non-Payroll cost transfers (email form to SPA)
Cost Transfer Procedure/Form
• Standard Form
• Salary Distribution Form
Sponsored Projects Training Program
Cost Transfer Forms
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Cost Transfer Policy Summary
- Key Changes 
Minimize cost transfers
(Advance accounts, Prospective payroll distribution changes, timely
PurCard transactions)

Timeliness
(< 90 days)
(Monthly PMBR review, Sufficient justification)

Untimely Cost Transfers ( > 90 days)
(Additional justification and approvals, Corrective action)

Cost transfer procedures/form
(Updated, standardized)
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Cost Transfer Policy Changes
- Questions/Feedback -
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Residual Balance Procedure
What is a residual balance?

Residual balance: For fixed-price
agreements only, this is the term for any
funds remaining after all charges have
been incurred to complete the project
and all project activities are complete.
Sponsored Projects Training Program
Current practice
Residual balances remain in sponsored
project restricted chart string.
 Project end-date is recorded as
“indefinite.”
 P.I. continues to expend funds for
additional research.

Sponsored Projects Training Program
Current practice issues



Doesn't recognize the unrestricted nature
of these funds.
Cost considerations, such as required
effort and sponsor allowable costs are no
longer applicable.
If federal, remains on Schedule of Federal
Awards and subject to audit.
Sponsored Projects Training Program
New procedure for residual balances

Residual balances remaining at the
conclusion of sponsored project funded
by a fixed price agreement, less
appropriate Facilities and Administrative
(F&A) costs, will be transferred to an
unrestricted chart-string for the Principal
Investigator’s use.
Sponsored Projects Training Program
Conditions for transferring residual
balances to department accounts
All
deliverables have been received and
accepted by the sponsor.
All costs for the project have been posted
to the project’s chart-string.
All payments for the project have been
received from the sponsor.
Sponsored Projects Training Program
Conditions for transferring residual
balances to department accounts
 The
residual balance must be more than
$200 direct.
 If the residual direct cost balance is greater
than 20% of the direct costs awarded, an
explanation detailing why the actual direct
costs were substantially less than anticipated
is required.
 If the residual direct cost balance is more
than $5,000, the intended use must be
described.
Sponsored Projects Training Program
Process
SPA staff will follow the standard award
closeout procedures for all awards within 90
days of end-date.
 For balances greater than $200, SPA will contact
the Principal Investigator and academic unit
administrator for a residual funds chart-string
request form.
 Once all conditions have been met, SPA will
transfer direct funds to unrestricted account.

Sponsored Projects Training Program
Re-Cap
Direct cost residual funds on fixed-price
agreements will be transferred to unrestricted
chart string for PI use.
 Certain conditions have to be in place for this
to occur (project complete, all expenses posted,
large balances analyzed).
 SPA will request the completion of a request
form during close-out if funds remain.

Sponsored Projects Training Program
?
Questions??
Sponsored Projects Training Program