REG 10.05.11 – Sponsored Awards – Budget Overdrafts

Authority: Vice Chancellor for Finance and Administration

History: First Issued: July 1, 2002.  Last Revised: April 5, 2013.

Contact Info: Assistant Director, Systems and Compliance (919-515-8011) Office of Contracts and Grants

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1.  INTRODUCTION

1.1  This statement explains budget responsibilities for sponsored awards and the criteria to be used by Colleges/Schools/Departments/Units when budget overdrafts occur.

1.2  It is the responsibility of the Colleges/Divisions and the Principal Investigator to ensure that over-expenditures on sponsored awards do not occur.  This responsibility extends to both direct and facilities and administrative costs on all active sponsored awards.  “Preaudit” reviews performed by the Colleges or Division administrative personnel should identify transactions which, if processed, will result in over-expenditure.

2.  RULE

2.1  Expenditures in excess of officially funded award amounts are unallowable.  In the event an error is made and over-expenditures occur, the over-expenditures must be moved off the project prior to the project end date.

2.2  It is the responsibility of the College or Division to resolve overdrafts as quickly as possible.

2.3  Federal, State and private sponsors do not permit the transfer of costs to other sponsored awards for the purpose of:

2.3.1  Eliminating overdrafts caused by expenditure overruns,

2.3.2  Avoiding restrictions, OR

2.3.3  Other reasons of convenience.

3.  GUIDELINES FOR CORRECTING BUDGET OVERDRAFTS

3.1  It is the responsibility of the Department, College or Division to review their projects periodically for budget overrun situations.

3.2  If a College or Division fails to eliminate a budget overdraft within thirty (30) days past the project end date, the Office of Contracts and Grants may elect to transfer the costs to the College or Division’s operating budget or discretionary project ID.

3.3  The College or Division may request that a budget overdraft be allowed to continue thirty (30) days beyond the project end date if proof of additional funding is provided in writing (from the Sponsor’s administrative/financial authority) to the Office of Contracts and Grants.  In these cases, the College retains full responsibility for all over-expenditures in the event funding is not received.