Reconciling Transactions
Reconciling transactions on a monthly basis is important to grants management. If you keep good records, are proactive in reconciling your transactions, and prompt in making corrections, your close-out audit should be trouble-free. Being proactive is the key to success.
Workday is the official University of Miami’s financial system and will assist in grants management. Research Administration is the custodian of the Research Reporting System (RRS) which includes the PI Portal. For more information about RRS visit the Systems page.
Cost Accounting Standards
When a sponsor awards funds to the University in support of specific programs and projects, it requires the University to manage those funds prudently to ensure that any costs incurred directly benefit the project accounts being charged.
The Federal Government is the largest sponsor of externally funded activity at the University. The cost principles relating to expenditures on federal awards are contained in the Office of Management and Budget's Uniform Guidance 2 CFR 200. These cost principles require that any expense charged to a federally sponsored project be reasonable and necessary, allocable, consistently treated, and conform to any limits or exclusions set forth in the Uniform Guidance (UG), or the terms and conditions of the award.
Anyone approving or processing the expenditure of federal funds must have a clear understanding of the University of Miami’s Cost Principles Policy and apply consistent application of these fundamental cost principles. In addition, individual awards may include special terms and conditions which must be considered when incurring costs. Terms and Conditions in an award which specifically address costs override all related comments in the Cost Principles Policy guidelines document. Consult with the appropriate Contract and Grant Administrator in Research Administration for more details.
Unallowable Costs
Unallowable costs are defined as those expenses which are not reimbursable under the terms and conditions of federally sponsored agreements and/or those specifically identified as unallowable in the Uniform Guidance (UG) Subpart E. In the event a discrepancy exists between the UG and those specified within the sponsored agreement, the agreement provisions will prevail.
An expense must meet all of the following criteria to be considered an allowable cost:
- The cost is reasonable: A prudent person would have purchased this item and paid this price.
- The cost is necessary: The expense is required to fulfill the terms and needs of the sponsored agreement.
- The cost is allocable: The expense benefits the sponsored agreement or, when the expense benefits more than one activity, an appropriate share can be allocated to individual agreements.
- The cost is consistently treated: Expenses for the same purpose are treated and classified the same way under like circumstances.
- The cost is not prohibited: The expense is not specifically prohibited by the Uniform Guidance (UG), the terms of the sponsored agreement or other regulations.
If an activity/expense does not meet the above criteria, it cannot be charged directly to a federal award nor can it be included in the indirect cost base regardless of its purpose. In addition, it cannot be used to meet a cost share commitment. Please see the Overdrafts and Disallowances Policy.
Budget Revisions
During the conduct of the project, the principal investigator may determine that budget changes are necessary. Many sponsors allow flexibility in how project funds are expended and permit budget changes needed to meet project requirements. Principal investigators need to be aware of the specific requirements for their awards and to request prior approval for budget changes when necessary.
Revisions to sponsored project budgets that require sponsor prior approval must be reviewed and approved by the Office of Research Administration. Please review the University of Miami’s Rebudgeting Policy.
Effort Certification/Reporting
The University of Miami’s research enterprise depends on funding from federal and state agencies, private foundations, organizations, and industry. The University's electronic system, Employee Compensation Compliance (ECC) is the principal means of verifying that salaries and wages charged to or contributed to a sponsored project are fulfilled in a manner consistent with the award documentation and compliant with the federal regulations for which the University is held accountable. All faculty are required to certify their effort and confirm the effort of all staff on their project in ECC. It is imperative that effort be certified in a timely manner. (See Effort Reporting Policy).
Cost Transfers
A cost transfer is any adjustment or transfer of expenditures to/from an externally funded contract or grant purpose/project by means of a journal. Diligent review of financial records and timely communication between principal investigators and departmental administrators should prevent the necessity for transfers; however, under certain circumstances transfers may be appropriate.
To comply with the requirements of the Uniform Guidance 2CFR 200, and the requirements of other federal sponsors, the University of Miami has established the following Cost Transfer Policy.
A cost transfer for personnel costs is called Payroll Accounting Adjustment or PAA. It is imperative that PAAs be completed in a timely manner and prior to effort being certified in the ECC system.
Program Income
Program income means gross income earned by the recipient that is directly generated by a supported activity or earned as a result of the award (UG subpart D) during the period of performance.
Program income includes, but is not limited to, income from fees for services performed, the use or rental of real or personal property acquired under federally funded projects, the sale of commodities or items fabricated under an award, license fees and royalties on patents and copyrights, and interest on loans made with award funds.
If there is program income included for the award, refer to the University of Miami’s Policy on Program Income.
For more information about managing your award, visit the Post Award page.
