| Effective Date: 7/1/05 |
| Office of Origin: Budget and Resource Management |
I. Purpose
Committed cost sharing represents a binding commitment by the University to a sponsor and, as such, is subject to audit under federal and other sponsor regulations. To avoid financial liability as a result of audit disallowance, it is the responsibility of the principal investigator (PI) to incur expenditures in accordance with applicable regulations and policies:
A. The cost principles contained in Office of Management and Budget (OMB) Circular No. A-21, Cost Principles for Educational Institutions;
C. The standards contained in OMB Circular No. A-110 – Uniform Administrative Requirements for Grants and Agreements With Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations;
D. The terms and conditions of each extramural award (including sponsor policies); and
E. Any other applicable University policies.
Cost Sharing: The federal government defines cost sharing as the portion of project costs not borne by the sponsor. There are two types of cost sharing: committed and uncommitted. If cost sharing is specified and quantified in the proposal narrative, budget, or budget justification, the University is committed even when not required by the sponsor. Costs incurred by the University to fulfill cost sharing pledges or commitments must coincide with the budget period of the sponsored award.
Committed Cost Sharing: a contribution of effort or other costs, which are quantified in the proposal narrative, budget, budget justification, or in the award document. Committed cost sharing may be either mandatory or voluntary.
Effort Reporting: the time and effort certification by a person recorded on a Personnel Activity Report (PAR) that is designed to substantiate effort directly charged and/or committed to federally sponsored projects as required by Office of Management and Budget (OMB) Circular No. A-21, Cost Principles for Educational Institutions. The requirements for effort reporting are stated in Campus Administrative Policy 300-20.
Mandatory Cost Sharing: sponsor required participation in the costs from other sources and a commitment by the University to meet this requirement. This requirement may specify either a minimum fixed percentage of other funds or a level of other participation that has been negotiated between the University and the sponsor.
Primary Department: the department that submits a research proposal and that is responsible for the administration of a sponsored activity.
Secondary Department: a department that has made a cost sharing commitment to a primary department in the form of faculty, staff or other personnel time and expense or nonpayroll expense.
Uncommitted Cost Sharing: faculty- or senior researcher- donated time above that which is agreed to as part of the award. Voluntary uncommitted cost sharing does not require documentation or reporting and is excluded from the effort reporting requirement.
Voluntary Committed Cost Sharing: quantified effort that is neither required nor paid for by the project sponsor but which is committed to a sponsored project. Voluntary committed cost sharing may occur in three ways:
1. Resources identified and quantified in the proposal narrative, budget, or budget justification but not required by the sponsor. A common example of voluntary committed cost sharing is quantification by a faculty member of a percentage of effort that exceeds the corresponding request for funding.
2. Change by a PI of the source funding for effort on an award to substitute other funds for the sponsored award fund. The original amount of committed effort remains the same, but the PI has voluntarily substituted another fund source.
3. Compliance by a PI with policies requiring minimum effort on a sponsored award, without charging that effort to the award.
A. The University allows mandatory cost sharing if it is a condition of the award.
B. The University allows but does not encourage voluntary committed cost sharing.
C. The University allows voluntary uncommitted cost sharing.
D. Departments and PIs must identify the source(s) (i.e. account and fund) of funds for committed cost sharing, both mandatory and voluntary, at the time of the submission of the application to the sponsor, and must confirm this information at the time they accept the award.
IV. Responsibilities for committed cost sharing
A. Primary Department
1. PI is responsible for:
a. Developing proposals in conformance with university and federal laws, policies, and regulations;
b. directing expenditures in conformance with university policies and guidelines;
c. identification of mandatory and voluntary cost sharing commitments within proposals;
d. providing required information for the cost sharing report; and
e. obtaining written assurance for cost sharing commitments from outside departments or agencies.
2. Department Business Manager/Research Administrator is responsible for:
a. Reviewing proposals and determining the account and fund sources to support cost sharing commitments;
b. obtaining demonstrable commitments of cost sharing and approval from appropriate sources to use the funds identified to support cost sharing commitments, including those from secondary departments;
c. completing, and revising as necessary, a budget reflecting the cost sharing commitment agreed to in the award;
d. monitoring post-award fulfillment of cost sharing commitments, including the certification of cost shared effort, and of expenditures to applicable fund sources during the budget period of the sponsored award;
e. maintaining documentation to substantiate cost sharing expenditures;
f. reporting and certifying actual cost sharing expenditures (including effort) to the Controller’s Office, Extramural Funds, in accordance with procedures; and
g. providing documentation demonstrating that funds from any source committed as cost sharing to an award have not been committed more than once.
B. Secondary Department
1. Faculty and staff agreeing to committed Cost Sharing are responsible for:
a. Specifying level of commitment to a proposal to Primary Department PI;
b. informing secondary department research administrator and business administrator; and
c. identifying account and fund that will be used to pay for commitment if the proposal is funded.
2. Department Business Manager/Research Administrator is responsible for:
a. Confirming in writing Secondary Department support of commitment of time and/or expenditures for proposal to Primary Department;
b. providing one or more account/fund(s) to the Primary Department for any cost sharing commitment;
c. ensuring that cost sharing commitment is fulfilled if award is made;
d. maintaining documentation to substantiate cost sharing expenditures; and
e. providing documentation demonstrating that funds from any source committed as cost sharing to an award have not been committed more than once.
C. Office of Sponsored Research is responsible for:
1. Providing guidance to departments on identification of committed cost sharing and recording of committed cost sharing before submission of the proposal to the sponsor; and
2. ensuring identification of an approved account and fund for cost sharing before the proposal is submitted to the sponsor.
D. Controller’s Office, Extramural Funds is responsible for:
1. Confirming an approved cost sharing account and fund information at the time of an award;
2. assigning a cost sharing program code for departments to assign to each cost sharing transaction;
3. reporting actual cost sharing expenditures to sponsors as required based on information provided by departments; and
4. ensuring that allowable contributions are evaluated and documented in accordance with federal and University regulations and policies.
E. Budget and Resource Management Office is responsible for:
1. Policy determination and review for conformance with requirements of federal Facilities and Administration Rate Proposals; and
2. interpretation of federal costing regulations and UCSF Costing Policy Guidelines.
VI. References