University of Vermont

Cost Accounting Services 


Minimizing Cost Transfers on Sponsored Agreements

University policies, operating procedures and guidance reinforce the importance of correctly charging the expenses to sponsored agreement(s) when the cost is initially incurred. Units should integrate the following business practices within the below policies, procedures and guidance to minimize cost transfers.
  • Effort Policy - The Effort Management and Reporting policy provides important definitions of what constitutes 100% effort and describes effective effort management practices to minimize retroactive effort allocation changes. For example, the required quarterly verifications of effort by employees is an effective way to make prospective changes of effort within the expected required precision and minimize the probability of subsequent retroactive effort changes.  
  • Advance accounts - An Advance Account is a mechanism to establish a budget and account for allowable expenses on sponsored agreements prior to the receipt of an sponsored award document. Federal assistance funding (grants and cooperative agreements) may include pre-award spending authority or a sponsor may explicitly approve pre-award costs in anticipation of making an award.  For example, non-competing continuation awards have a high probability of being awarded and is a prime candidate to use the advance account for.  Contact your Sponsored Project Administrator or submit the appropriate form to  Sponsored Project Administration.
  • Department Suspense Accounts - If an advance account is not a viable option, department suspense accounts are available to temporarily post encumbrances associated with pending sponsored agreements. Upon notification that the sponsored agreement budget(s) has been established, salary distribution changes should be submitted to transfer encumbrances/expenses from department suspense to the appropriate sponsored agreement budgets.
Questions regarding the above University policies, procedures and guidance should be directed  to the appropriate central unit.

Last modified January 01 2013 08:06 AM