Postaward - General FAQs
- Why can't I manage my Sponsored funding in a bank account outside the University?
To avoid following the complex university and sponsor policies and being charged for indirect costs and administrative service fees, investigators face huge temptation to run research funds outside the University system.
One may think that opening a bank account in the name of the research program or running the research program through an affiliated organization are legitimate. But doing so would cause the following problems:
- Sponsored funds are awarded to the University. The University is thus held accountable for managing these funds. When research programs are run outside the University system, the University loses its ability to manage and monitor the use of these funds. Auditors will catch the University when such practice is found.
- Accepting sponsored funds is not without strings attached. Both Federal and non-Federal sponsors have rules or regulations to govern the use of sponsored funds. Managing these funds through the University system ensures that the rules and regulations are followed. Not being able to follow the rules and regulations jeopardizes the University’s ability to receive future research funding.
- The indirect cost potion of the sponsored funds is awarded to the University to cover the overhead costs incurred to house research at on or off campus locations. The University uses indirect cost reimbursed to pay for utilities, maintenance, capital asset depreciation, interest, library, and administration. Without the indirect cost support, labs will not be able to run and paychecks will have no one to process.
Because of the problems and risks it can create, managing sponsored funding outside the University is strictly disallowed by the University policy. If an investigator deposits funds outside the University or with an affiliated organization, he or she is in violation with the following policies:
- Not allowed to conduct sponsored research on the University property and use University facilities and personnel without a contract
- Checks made payable to any of the University entity may be deposited only in a University authorized account
- Must obtain prior approval of the University’s Assistant Vice President of Financial Services before establishing any banking relationship using the name or tax identification number of the University
- Depositing research funding with an affiliated organization must be approved by both the Research Office, with the concurrence of the affiliated organization. Terms of reimbursement, including overhead/indirect cost recovery, should still be consistent with the established University practices.
- Accounts for the benefit of University departments or faculty members should not be established with an affiliated organization without the prior written approval of the appropriate University vice president or dean of the college and the Provost.
- How do I Calculate Available Balance on a Sponsored Account?
Basic:
In FRS screen 9s, subtract Total Actual Expenditures from Total Budget. This gives you total balance available. For accounts with a 0% indirect cost rate, this is your available balance. However, for accounts with an indirect cost rate, the total costs balance needs to be further broken down into the actual direct costs available to spend, and the associated indirect costs that will be automatically charged to your account as you spend those direct costs.
To calculate your direct costs, total costs should be divided by 1 plus the indirect cost percentage. For instance, if the indirect cost rate is 50.5%, then divide total costs by 1.505. After arriving at your direct cost balance, you may then subtract valid personnel or operational encumbrances to further assess your balance.
Example 1 (assuming a 50.5% indirect rate):
Description |
Budget |
Actual |
Pers Svcs & ERE |
5,000.00 |
4,526.00 |
Operations |
3,000.00 |
2,219.00 |
Travel |
500.00 |
0.00 |
Indirect Costs |
4,295.50 |
3,406.23 |
Expenses |
12,792.50 |
10,151.23 |
1) Total Budget less Actual Expenses: 12,792.50 – 10,151.23 = 2,641.27 Total Costs available.
2) Total Costs divided by 1 + indirect rate percentage: 2,641.27 / 1.505 = 1,755.00 direct costs available to spend.
3) The associated indirect costs will be: 1,755.00 * .505 = 886.27.
4) Adding your direct costs to your indirect costs now brings you back to your Total Cost Available balance from step 1: 1,755.00 direct costs + 886.27 indirect costs = 2,641.27. After expending 1,755.00 of direct costs, FRS will automatically charged 886.27 indirect costs to your account, and your balance will be zero.
In assessing your direct cost balance, this calculation assumes you will be spending your available balance entirely on expenditures that bear indirect costs. If some of your planned expenses include indirect excluded charges, see the advanced calculation below.
Advanced:
The above calculation does not take into account expenditures that are exempt from indirect costs. Examples of these types of expenditures are Capital, Tuition Remission, and Patient Care. Different object codes are excluded depending on the type of awarded Indirect Cost Base, the full list can be viewed here: http://www.fso.arizona.edu/fso/deptman/5/502exp.html
Using the above example, let's assume that part of your planned future expenses includes 100.00 for object code 2111, graduate tuition remission, which does not get charged indirect costs on the standard MTDC Base 4. Since that 100.00 charge will not be assessed indirect charges at the 50.5% rate, you will have a higher balance of direct costs available to spend.
Example 2:
1) Total Budget less Actual Expenses: 12,792.50 – 10,151.23 = 2,641.27 Total Costs available.
2) Take your Total Costs and subtract your indirect charge exempt expenses: 2,641.27 – 100.00 = 2,541.27.
3) Take this subtotal and now divide by 1 plus your indirect rate percentage. 2,541.27 / 1.505 = 1,688.56.
4) Add the $100.00 to this amount and you have your direct costs available. 1,688.56 + 100.00 = 1,788.56. Notice that this direct cost amount available is higher than the available amount in Example 1. The ‘extra' 33.56 available amount is due to indirect cost savings from not having the tuition remission charged indirect costs. The 1,688.56 figure is your base that gets charged indirect costs, and the 100.00 is does not bear indirect costs.
Available Balance at the End of the Project
My grant ends in a month and I have $40,000 left. I don’t want to send the money back. What can I do?
The first clarification to be made is that the UA may not have all the "money", just the budget authority. Most cost-reimbursement sponsors reimburse (i.e., send checks or EFTs) the UA for actual expenditures incurred.
You have a few options, as follows:
1. Charge the Grant for any Remaining Allowable Costs You cannot charge expenditures for the sole purpose of utilizing an available balance. Federal regulations say you can spend your budget on "allowable" costs, i.e., costs that are reasonable, necessary to complete the project, charged in proportion to the benefit received (split funded accurately), and not otherwise prohibited. (A-21,C.2)
2. Request a No-Cost Extension If additional time is required to complete the technical requirements of an award, a No-Cost-Extension may be requested. All NCE requests must include the revised end-date requested, a technical justification for the extension (any departure from the original scope-of-work), and the unobligated balance at the time of the request.
For federal awards issued under the terms of the Federal Demonstration Partnership, the UA is authorized to internally approve a one-time no cost extension for up to 12 months (Grantee-Approved NCE). The PI must make the request in writing to SPS prior to the end date. Depending on the sponsor, you may need to make the request a certain number of days prior to the original end date. If a Grantee-Approved NCE has already been exercised, or is not allowed under the award conditions, a Sponsor-Approved NCE must be requested. The request must be made in writing by the PI, addressed to the grants officer, and countersigned by SPS. See related FAQ, How and when can I request a no cost-extension.
3. Closeout the Sponsored Account If a project is not expecting a continuation or NCE, proper closeout procedures must be initiated. Once final expenses have been reconciled and final concurrence is obtained from the PI, SPS will de-load any unobligated budget from the account, and send a refund to the sponsor, as required.
See related FAQ, Closeout of a Sponsored Project
- How do I transfer my grant to a new institution?
You have several options. The sponsor, however, makes the final determination and the PI should always contact the project’s program officer for advice prior to initiating any of the following options:
1. Request a Grant Transfer to the New Institution
A grant transfer to the new institution may be proposed for the remainder of the previously approved project period. Each sponsor has different procedures for moving an award from one institution to another. The NSF requires grant transfer requests to be submitted through FastLane. The NIH requires a "relinquishing statement" form (PHS 3734). The information generally required by the sponsoring agency is the name of the new institution, effective date of transfer, estimated unexpended balance as of the effective date of transfer (to be verified by SPS), and a list of equipment purchased on the grant that will be transferred to the new institution. All grant transfer requests must have written department head concurrence, and then be forwarded to SPS for institutional countersignature.
After receiving the relinquishing statement from the UA, the sponsor will terminate the grant with the UA and establish a new grant with the new institution for the remainder of the project. The UA will "relinquish" its interests and rights to the grant, reduce budget, and return any unexpended funds to the sponsor.
Gift funds and funds remaining at the end of a fixed-price contract are considered UA funds and are not available for transfer to the new institution.
Equipment purchased with sponsored funds for use on a specific project normally remains available for use for the duration of the project. PIs who are in the midst of projects that included authorized equipment purchases, and who will continue the project at a new institution, may arrange to have the equipment transferred with them. Shipping costs for such equipment may be charged to the UA grant account or the new institution grant account. Approval of the department head, dean, SPS Property Administrator, and the Vice President for Research is needed before the equipment may be transferred. Reference FRS Departmental Manual, Section 15.33, Table 7 for UA policy and procedures regarding transfer of equipment.
2. Issue of a Subaward by UA to the New Institution
When the amount of time and funds remaining in a project are modest, it may be feasible to issue a subaward to the new organization for completion of the project. Sponsor approval is required before a sub-award may be issued, and before any funds may be transferred from the UA to a new institution.
3. Keep the Grant with the UA under a New Principal Investigator
The administering UA department has the option of nominating a replacement PI to take over technical responsibility for the award. A change in PI must be formally requested and approved by the sponsor.
4. Terminate the Grant Before the End Date
A project may be terminated by the sponsor, the UA, or by mutual agreement of both the sponsor and the UA. The award agreement and/or agency and federal regulations specify the process for terminating a project before the end date.
- How and When can I request a No-Cost Extension?
No-cost Extension
If additional time is needed to complete a project's approved scope of work, a no-cost extension may be necessary. The no-cost extension extends the termination date at no additional expense to the sponsor. No-cost extensions are requested from the sponsoring agency, unless the sponsor authorizes the University of Arizona to approve the no-cost extension internally (see Grantee-approved no-cost extension below).
Requests for no-cost extensions should be made in writing to the sponsor prior to the end of the project. The PI should include a brief description of the research that remains to be accomplished using the existing funds. The PI must obtain institutional countersignature from the SPS Director or designee prior to sending the request.
Grantee-approved no-cost extensions
If the project is issued under the terms of the Federal Demonstration Partnership (FDP), a one-time no-cost extension of up to twelve months can be automatically approved by the University of Arizona. The University must notify the sponsor of its intent to issue a no-cost extension at least 10 days prior to the termination date of the project. The PI should send a memo/e-mail to Sponsored Projects indicating (1) the extension period, up to twelve months, and (2) a brief explanation of the work that remains to be completed. SPS will determine (1) that the award is under FDP terms, (2) that no prior grantee-approved no-cost extensions have been issued, and (3) that there is budget remaining in the account, as well as (4) a reasonable research-related justification. If these conditions are met SPS will issue a letter, signed by the SPS Director, to the sponsor indicating that the University of Arizona is issuing a grantee-approved no-cost extension. The letter serves as official notification that the termination date is extended.
Exceptions:
NSF
PI requests a “Grantee-Approved no-cost extension” through the NSF FastLane website, at least 10 days prior to the project's current end date. Upon PI submission, the electronic request will be forwarded to SPS Preaward. Preaward will verify with the Postaward team that the no-cost extension is appropriate, and the extension notification will be sent to the sponsor. Extension of the end date will take place immediately upon submission.
NIH
Grantee-approved no-cost extensions will be submitted through the NIH Commons web site. Unlike FastLane, the PI/department cannot initiate the request in Commons. The PI/department should start the processing by sending the email or paper request to the fund accounting team. The team will then review the request and forward approved requests to Preaward for processing. Extensions will take affect immediately upon submission to Commons. Extensions can be done through Commons as late as the last day of the budget period.
DOD , EPA , and NOAA also have agency specific exceptions for no-cost extensions. Contact your fund accountant for information for additional information.
- What is Bridge Funding and how do I get it?
Bridge funding refers to any funding needed or used to complete a project beyond its original budget and or project period.
There are a variety of ways to receive bridge funding and it only requires a little vigilance and a little luck to receive it. The institutions that the University of Arizona works with use a variety of instruments for b ridge funding, but the NIH sets a standard that is generally followed by other Federal and non-Federal sponsors. In general, the PI must request additional funding and time in a letter to the sponsor at least 30 days before the project end date. The letter must include a new proposed end date and a budget for the additional funds requested. The letter should also include a justification for why the additional funds and/or time are needed. While it may be necessary to explain problems and unforeseen expenses in this justification, it is optimal to emphasize the importance and value of the project and that the unforeseen expenses will ultimately allow a more complete and valuable finished product than originally expected. The sponsor will be far more inclined to fund a project that has become more interesting and dynamic than one that has become more complicated and problematic.
Once the PI has prepared the letter and budget, it must be forwarded to Sponsored Projects for institutional signature along with a Proposal Routing Sheet. This should be done as early as possible to have the best possible chance to receive funding. This is especially true of federal sponsors as the demands on federal funding continue to outstrip supply.
It is important also to remember that sponsors are not the only source of bridge funding. Departments and colleges may also provide supplemental funding. To learn more on how to go about receiving bridge funding from your department or college, see your department head and dean or check with your business manager to see what your college's/department's procedures are regarding bridge funding.
- What happens during closeout of a sponsored account?
Certain procedures must be followed when a sponsored project is ending to ensure that the University meets closeout requirements imposed by sponsoring agencies. OMB Circular A-110 states, “Recipients shall submit, within 90 calendar days after the date of completion of the award, all financial, performance, and other reports as required by the terms and conditions of the award (Ref: A-110 D.71.(a)). Closeout requirements for each award should be reviewed thoroughly, as some sponsors require shorter closeout periods of 30, 45, 60 days, etc.
Principal Investigators and departmental support staff are responsible for ensuring that all financial activity is completed and reconciled within the closeout period specified. To help facilitate this process, SPS sends the department an electronic closeout notice, Notice of Account End Date, 90 days prior to an account end date. This notice requests the following steps be initiated:
- Submit requisitions in a timely manner so that all materials and supplies can be received and used on the project by the end date.
- Check all encumbrances for validity. Invalid encumbrances should be cancelled.
- Ensure that all payroll is removed from the project by the end date.
- Notify UITS - Financial Management Services (telecom@email.arizona.edu) to change the account number for monthly and long distance charges.
- Check the award provisions for technical reporting requirements.
See related FAQ, Allowable Expenditures at the End of a Project
FINAL REPORTING REQUIREMENTS:
Final Technical Report
The PI is responsible for preparing and submitting all required technical reports and deliverables to the sponsor, per the agreement. An electronic notice is automatically sent to the PI, as a reminder, 60 days before an account end date. The PI does not need to send a copy of the final report to SPS. If the final technical report is late, the sponsor will notify SPS and may withhold funding to the University for all accounts and freeze the issuance of new awards.
Final Invoice
Timely expense liquidation and reconciliation of each account is important in order to meet final invoicing requirements imposed by the sponsor. After final expenditure concurrence is obtained from the PI, SPS will send the final invoice to the sponsor. The deadlines for final invoicing vary by sponsor, but generally range from 30-90 days after the term date of an award. If a final invoice is submitted late, the sponsor has the right to deny payment.
Final Financial Report
A final financial report is required for most cost-reimbursement contracts and grants. After final concurrence from the PI is obtained, SPS prepares the financial report and mails it to the sponsor. Most sponsors require the final financial report submittal no later than 90 days after the termination date of a project, but this requirement varies by sponsor and award.
Contract Closeout Documents
Many contracts require the submission of final closeout documents. Each award should be reviewed for the submission requirements of the following:
Document |
Signatory |
Purpose of Document |
Contractor’s Release of Claims |
SPS Director
|
Frees contractor of all liabilities, obligations, claims, and demands |
Contractor’s Assignment of Refunds, Rebates, and Credits |
SPS Director |
Agreement to reimburse the contractor for any refunds, rebates, credit, or interest |
Cumulative Claim and Reconciliation Statement |
SPS Director |
Reconciles allowable expenditures and actual receipts |
Final Report of Inventions and Subcontracts |
PI; Office of Technology Transfer |
Reports inventions under the contract |
Final Property Report |
SPS Property Administrator
|
Listing of government-titled property |
Refunds to Sponsor
At the end of a cost-reimbursement project, SPS will provide a refund to the sponsor for all cash received in excess of final expenditures. Final expenditure concurrence from the PI is required before refunding the unexpended balance.
Remaining Balance on Fixed Price Accounts
Funds remaining at the completion of a fixed price contract are considered local "discretionary" funds. SPS will verify that all funds have been received and all
- How do I update Approvers on Sponsored Accounts?
To change approvers go to the FSO Forms Online webpage ( http://uabis.arizona.edu/eforms/#F ) and open the FRS Update Account Memo. (Or use the direct link http://www.fso.arizona.edu/fso/deptman/6/account_update_form.asp ) Follow the instructions listed on the form.
IMPORTANT:
Sponsored Projects maintains a list of default approvers for each department (such as department business manager, etc). When an account is created, these default signers are automatically added to the account. To change the default signers for the department, be sure to check the box on the form where it says:
“Update default authorized signatures for creating new Sponsored Projects accounts (3XXXXX, 03XXXX, 4XXXXX, 04XXXX).”
If this step is not completed, new accounts will continue to be created with old aprovers.
This box should not be checked if the change in approvers only applies to specific accounts and is a one time change.
- What is FDP?
FDP stands for The Federal Demonstration Partnership. The FDP is an association of Federal agencies, academic research institutions, and research policy organizations. It was established to increase research productivity through streamlining the administration of federally sponsored research.
The FDP started as an experiment in 1986 between a few Federal agencies and universities. Now, it has evolved into an organization of 10 Federal agencies and more than 90 research institutions.
See a list of FDP members at: http://thefdp.org/Phase4_Members.html
See FDP terms and conditions at: http://www.nsf.gov/awards/managing/fed_dem_part.jsp
- What is Program Income?
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