Managing Sponsored Awards and Transactions

Sponsored Project Accounts:

Faculty PIs, or their designees, are responsible for ensuring that expenditures charged to sponsored grants and contracts are in direct support of the program.  In this manner, the department manager is responsible for setting up processes that ensure costs are allocable to specific sponsored projects before they are passed through the BSC.  The BSC is responsible for reviewing allowability under overall financial policy.

Cornell University expects costs to be charged to the   appropriate sponsored project account when first incurred. There are   circumstances in which it may be necessary to transfer expenditures to or   from a sponsored account subsequent to the initial recording of the charge in   the general ledger. Review of sponsored project account activity should   include the determination that charges are reasonable, allowable, and   directly support the scope of work for the project. To be allowable, the   transfer request must be timely, fully documented, conform to university and   sponsor allowability standards, and have appropriate authorization.

 

Proper management of funds is essential to uphold the fiduciary responsibilities of the university. Frequent, late, and inadequately documented and unexplained transfers, especially those that involve sponsored projects with overruns or unexpended balances, raise serious questions about the propriety of the transfers, and may result in expenditure disallowances and/or subsequent reduction in funding.  Knowledge of award and policy requirements and ongoing monitoring will improve the quality of financial reporting, improve compliance with regulatory requirements, and reduce the administrative burden and risks inherent in document corrections.

When one is travelling on funds provided by the federal goverment travelers MUST USE U.S. Flag Carriers.  Such carriers include American, United, Delta, US Airways, etc.  This requirement must be observed even in instances where foreign carriers are cheaper, provide preferred routing, more convenient, or part of a frequent-flyer agreement.  There are limited exceptions (see web site).  Using AAA to book your trip requires that the travel inform the agency the trip must be booked on a U.S. Carrier due to the Fly America Act.  AAA does not automatically follow these guidelines even if you state it is a Cornell University trip. http://www.dfa.cornell.edu/cms/accounting/topics/sponsoredfinance/upload/FlyAmericaOpenSkies.pdf  A signed exception form is required to be filed with the reimbursement using Foreign-Flag-Carrier-Form.

The University has a policy on cost transfers when sponsored accounts are involved. The complete policy is located at: http://www.dfa.cornell.edu/cms/treasurer/policyoffice/policies/volumes/finance/upload/vol3_20.pdf

 

The following information must be provided on, or attached to, the General Error Correction (GEC) document:

• A description of the cost(s) being transferred, including why and when the original charge(s occurred

• Why the receiving account was not originally charged

• Why it is appropriate to charge the receiving account. The cost item must be allowable under

the terms and conditions of the sponsored agreement and other regulations governing the sponsored agreement

• That any systematic or administrative deficiency (if any) that caused the need for the transfer has been addressed

Unallowable object codes are NOT ALLOWED on Sponsored Project Accounts regardless if the expense is allowed.  You should refer to the OMB Circular A-21 if you are not certain if a transaction is allowable to the account.

Common Unallowable Costs

  •  Advertising (J.1)
  • Alcoholic beverages (J.3)
  • Alumni activities (J.4)
  • Bad debt expense (J.6)
  • Commencement and convocation costs (J.8)
  • Contingency provisions (J.11)
  • Defense and prosecution of criminal and civil proceedings, claims, appeals and patent infringements (J.13)
  • Donations or contributions rendered (J.15)
  • Entertainment (J.17)
  • Fines and penalties (J.19)
  • Fund raising (J.20)
  • Goods and services for personal use (J.22), including housing and personal living expenses (J.23)
  • Lobbying (J.28)
  • Losses on other sponsored projects or contracts (J.29)
  • Memberships, subscriptions and professional activity costs (J.33)
  • Student activity costs (J.48)
  • Travel costs (J.53)

**Remember this is a quick reference guide. There may well be reasonable exceptions to some of the unallowable costs listed here.**

OMB_A-21 [Unallowable Cost Information]

Sponsored Project Accounts are always in the CG Fund group.