GEORGETOWN UNIVERSITY
FINANCIAL AFFAIRS MANUAL
Issuing Department Topic: Accounting for
Cost and Sponsored Clinical Trial Activity
Accounting
New (X)
Revised
Policy # FA 119-06
Supersedes Policy
100.01 POLICY: Accounting for Clinical Trial Activity
100.02 STATEMENT: Revenue earned from industry sponsored clinical trials will be based
upon the trial activity (i.e., set fees and patient milestones).
100.03 APPLICABILITY: The policy applies to all departments that have industry sponsored
(non-federal) clinical trials agreements (i.e., cost centers designated as Cashflow 2).
100.04 PURPOSE: The purpose of the policy is ensure that revenue from industry
sponsored clinical trials is properly recorded and to detail responsibilities
associated with accounting for such trials at the University.
100.05 ADMINISTRATION:
Budget Preparation
Trial Data
Financial Data
Posting of Revenue
Budget Monitoring
Clinical Trials Office (CTO) will coordinate with Principle
Investigators, the Medical Center Office of Sponsored
Research (MCOSP), the office of the Medical Center CFO,
and department administrators to establish a budget for the
clinical trials. Budgets will be based upon a reasonable
expectation of patient activity and the associated fixed and
variable costs. Anticipated surpluses can be budgeted to
account code 78442.
Trial Coordinators will provide department administration
with patient data.
Department administrators will convert patient data to
financial data based upon the clinical trial agreement.
Medical Center Finance Office will prepare a journal
voucher based upon the data received from the department
to post revenue and the associated receivable. Revenue
will be posted to account code 51214 and a receivable to
account code 02826.
The CSR for Industry Sponsored Trials (Cashflow 2) will
reflect both budgeted variances, revenue and expense
differences, and cash balance information to assist
Effective
Date
07/01/05
Collection of Receivables
Closeout of Award
100.6 DEFINITIONS
Clincial Trials:
Revenue:
Cash Collected:
Trial Data:
Financial Data:
departments and Medical Center Finance with monitoring
the financial aspects of the clinical trials.
All checks will be sent to the Sponsored Accounting Office
(SAO). Cash will be posted to the receivable account with
the assistance of the CTO. SAO will monitor collections
and will coordinate efforts with the CTO to receive cash
from delinquent sponsors.
At the expiration of the trials, SAO will confirm with the
department that the trial is ended. The department will
confirm that all costs have been appropriately charged.
Revenue and expenses will be balanced using account code
78442 (surplus transfer account). Surplus funds will be
transferred to the Medical Center Clinical Trial holding
account pending release to the department. All transfers
will be made to GD accounts and subject to all budgetary
constraints associated with GD’s.
The trials under this policy are industry sponsored (i.e, nonfederal) trials that sponsors pay the University based upon fix fees
for trial milestones. They are to be designated as Cashflow 2 in the
grant management system by MCOSP.
Revenue is recognized based upon terms of the clinical agreement
and not upon cash collected or expenses incurred.
Cash receipts collected from sponsored and posted against
receivable account.
Patient milestone information (i.e., Four patients have been given
treatment A).
Patient milestone data converted into the financial terms of the
agreement (i.e., agreement pays $1,000 per patient).
100.07 RESPONSIBILITIES:
Clinical Trial Office
Trial Coordinator
Clinical Department
Campus Finance Office
Sponsored Accounting
Budgeting, collection assistance.
Collection of patient data.
Conversion of patient data to financial data, budget
monitoring.
Preparation and posting of revenue voucher, receivable
balance monitoring, and budget monitoring.
Receipt and deposit of cash receipts, monitoring of
collections, closeout of cost center.
100.08 ENFORCEMENT: SAO and Internal Audit will work with senior management to
ensure that departments are in compliance with this policy.
100.09 RESOURCES: Office of Cost and Sponsored Accounting
100.10 APPROVAL: The Assistant Vice President, Administrative Services approves the
policy.
100.11 REVIEW CYCLE:
The policy is reviewed annually by the Director of Cost and
Sponsored Accounting with input from the directors of OSP
and MCOSP and campus CFOs.