300-19 Expenditures of Extramural Funds

Effective Date: 1/1/92 (revised 7/15/08)

Office of Origin: Controller’s Office

 

I. Purpose

Expenditures of extramural funds are subject to audit by funding agencies. To avoid financial liability as a result of audit disallowance, it is the responsibility of the principal investigator to incur expenditures in accordance with applicable guidelines: (a) the cost principles contained in the Office of Management and Budget (OMB) Circular A-21, Cost Principles for Educational Institutions; (b) the terms and conditions of each extramural award; and (c) any other applicable University policies.

II. Definitions

Extramural funds: contracts and grants awarded through, and formally accepted by, the Office of Sponsored Research for research, instruction, training, or public services.

III. Policy

A.    Expenditures Under Extramural Funds

  1. The project principal investigator must incur expenditures within the period as outlined in the award document. Exceptions may be authorized only by the appropriate division of the Office of Sponsored Research or by the appropriate official of the funding agency.
  2. The project general ledgers should be reviewed regularly to ensure budgetary control and appropriate recording of expenditures.
  3. The expenditures incurred must be allowable in accordance with project terms and conditions and, when applicable, as defined by Office of Management and Budget (OMB) Circular A-21, Cost Principles for Educational Institutions.
  4. The project principal investigator must exercise caution so that the expenditures incurred are within the total authorized budget. In the event of cost overrun, the principal investigator is responsible for the transfer of such overrun out of the project.

B.    Transfer of Expenditures of Extramural Funds

  1. Initial care should be exercised to ensure that expenditures are charged to the correct account. However, if an error requiring correction occurs, a transfer of expenditures is necessary (see Administrative Policy 300-22, Cost Transfers).
  2. A cost transfer is required when the sole purpose is to clear an overdraft of the extramural funds.
  3. If an overdraft is not cleared by the principal investigator in a timely manner, the Controller’s Office may exercise its authority to transfer the over-expenditures to other funds.

    C.    Financial Reporting of Extramural Funds

  1. The principal investigator must ensure that all financial transactions are recorded properly and timely on the general ledgers so that financial reporting responsibility can be carried out by the Controller’s Office.
  2. The general ledger is the official record of project financial detail and shall be the basis for all financial reports.

IV. Responsibility

A.     Principal Investigator

The principal investigator is responsible for the fiscal management of the project. For operational purposes, the principle investigator may delegate financial management to his or her administrative staff.

 

B.     Controller’s Office

The Accounting & Reporting office is responsible for the set-up and close-out of contracts and grants, financial reporting, and collection and reimbursement of expenditures incurred.

V. Related Policies

VI. References