From Start to Finish
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| Two
common situations in which the allocability of an
expense will be critically reviewed are those where
expenses are incurred before the start of
a project period, and those where expenses are incurred
just before the end of a project period.
During the project period, while the work of the
project is being carried out, sponsors may also
look closely at the RATE of project expenditures.
When a new award is assured but the funding is delayed,
it may be appropriate to open a "contingent
account." |
Contingent
Accounts |
|
It
is NOT appropriate to charge these costs to other restricted
or sponsored accounts, even if you intend to transfer
them later. You should also avoid charging these to non-sponsored
accounts and then transferring them later.
By opening a "contingent account," you will
not have to transfer expenses onto a new account when
funds arrive, thus avoiding both administrative burden
and audit exposure. Opening a "contingent account"
requires the identification of a departmental unrestricted
account number or "guarantee account," in the
event the sponsored funds do not arrive.
|
| During
the project period, PI's can jeopardize their funding
when spending EITHER accelerates at an unanticipated
rate OR falls significantly behind project projections.
|
Spending
Patterns: Fast or Slow |
|
While
there may be very good programmatic reasons for accelerated
or decelerated levels of spending, it is ALWAYS a good
idea to keep the sponsor - both the technical and the
administrative officers - informed in these situations.
In the case of Federal contracts, there are specific
requirements for notification when the total cost
will be greater or substantially less than the estimated
cost, OR at the point when expenditures will exceed 75%
of the total project cost.
|
| Finally,
it may be necessary and appropriate to purchase
equipment, supplies or other expenses late in the
project period. In these cases, it is particularly
important to document the allowability -- and particularly
the allocability -- of the expense. |
Late-in-Period
Expenses |
|
Expenses
incurred after the project period has ended are unallowable,
unless the award contained provisions permitting them
to be charged. This includes expenses incurred for the
production of final project reports. If you have work
left to do on a project, but have run out of time, request
a no-cost extension. This request must be coordinated
through the Office of Research and Project Administration
(ORPA). |
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