Contracts and Grants Procedure 9 – Financial Reporting to Sponsoring Agencies

General Requirements

With few exceptions, agencies or organizations sponsoring University research or training projects require some form of financial and technical reporting. Reporting requirements vary in frequency, format, due dates, and detail. The Office of Contracts and Grants strives to prevent the imposition of unreasonable financial reporting requirements (negotiating more reasonable requirements when possible) and complies with all financial reporting requirements once a contract or grant is accepted. The office also monitors compliance with technical reporting requirements. Not only is timely technical reporting a specific requirement and a separate area of audit emphasis, delayed reports can result in withholding of sponsor payments and can jeopardize future awards from that sponsor.

Financial data included in a proposal is budgetary in nature and establishes the financial parameters for a project for both current and future fiscal years. Requests for financial support must be realistic and consistent with the planned scope of work. The budgetary content of each proposal must be reviewed by the Office of Contracts and Grants prior to release to the potential sponsor.

On multiple-year projects with federal agencies, the University is required (long before the current budget year is complete) to update the budgetary data previously submitted for remaining project years and to provide an estimate of funds which will remain upon completion of the current budget year. The federal agency uses this estimate (normally prepared by the principal investigator) (P.I.) to determine future fiscal year funding requirements and new funding necessary for the specific University projects. The Contracts and Grants Office can prepare this segment of the report with input from the principal investigator. Please keep in mind any residual fund balance must be prudently estimated. If the residual fund balance is under or over estimated, the future budget year will be distorted accordingly.

Interim Reports

Some sponsors require interim reports, such as monthly or quarterly, for purposes of tracking the financial status of the project and for handling reimbursements due the University. Contracts and Grants normally handles these interim billings or reports without requiring input from the P.I. or department unless matching is involved. The terms of the agreement will govern how frequently matching information must be gathered. If the terms of the award require matching that is not reportable, the Principal Investigator will be required to provide matching information each semester.

Final Expenditure Report

The University is required to submit a final report of expenditures generally 60 to 90 days subsequent to the termination of an award. All authorized expenditures and outstanding obligations must be determined and considered in preparation of this report. Accurate, timely, and complete input from the P.I. and department is essential to prepare this report.

Unrecorded Obligations

Certain obligations will not be reflected in the monthly FYRWFDST and FYRWFMTD reports until paid, sometimes one or two months after the obligation is incurred. Therefore, such obligations must be carefully controlled. Examples include duplicating charges, intra-departmental distribution of telephone tolls, photocopy costs, travel, temporary help and similar services not subject to the encumbrance system.

These obligations must be carefully controlled, particularly near the date of termination. Any obligations presented to the Office of Contracts and Grants after the final report of expenditures has been filed must be paid from a source other than contract or grant funds.

Close Out Checklist

A Close Out Checklist is forwarded to the principal investigator 60 days prior to termination of a contract or grant budget period. Please see Appendix 9 for a copy. After receipt, the principal investigator must bring to a close all expenditures for the budget period; and correct all problems associated with the grant, so that the final report of expenditures may be completed with minimum complication.

Responsibility of the Principal Investigator

The principal investigator should maintain detailed financial records for the sponsored project. These records are to be utilized when reviewing the University Monthly Financial Reports, and when performing any other required administrative duty.

The principal investigator is responsible for the timely submission of all required documentation during the grant period, e.g., Cost Sharing and Matching Funds and Effort Certification Reports.

The principal investigator is required to handle any problems associated with the grant within thirty to forty-five (30-45) days of termination. The Office of Contracts and Grants assists in any way possible, but the main responsibility for internal problem solving resides with the principal investigators. Examples of problems which might occur are: payment of outstanding obligations; overdrafts in expenditure lines; expenditures charged to incorrect lines; and preparation and approvals of budget revisions. In addition, there are occasional problems unique to a fund which must be resolved prior to close-out.