7.5 - Financial Management


The Accounting Office has responsibility for fiscal matters regarding awards. After the award is reviewed and processed by the ORSP, the Accounting Office establishes the sponsored program account (see Section 7.1) and forwards information pertinent to the fiscal management of the sponsored program to the PI/PD. PIs/PDs are provided with monthly expenditure sheets reflecting monthly and cumulative expenditures and encumbrances on a state fiscal year basis (July 1–June 30).

The PI/PD is responsible for managing the budget and expending it in accordance with sponsor and university regulations on allowable, allocable, and attributable expenses related to the project, as indicated in the approved budget. Some sponsors require approval of any divergence from budget categories or items. Section 7.11 provides information regarding procedures for seeking prior approval for deviations from conditions imposed in an award document. The PI/PD must be familiar with and comply with both the sponsor’s guidelines and the university guidelines for fiscal management of sponsored programs.

General guidelines for expending sponsored program funds are as follows:

  • Costs must be allocable, bearing a direct relationship to the activities of the program, not to the general needs of the department or university.
  • Costs must be reasonable, reflecting conscientious and prudent financial decision-making.
  • Costs must be consistently treated, consistent with the normal costs standards of the university and not exceeding normal limits of similar charges that are not grant-supported.
  • Costs must adhere to sponsor-stated restrictions, recognizing and respecting any restrictions on use of funds stipulated by the sponsor.

The university is subject to an annual audit in accordance with OMB Circular A-133. This audit conforms to specified federal guidelines and serves to certify the effectiveness of the financial management systems and internal procedures. Fiscal integrity of financial transactions is tested, as well as compliance with terms and conditions of federally sponsored activities. The annual audit involves a review of both institutional systems and selected individual program accounts. Financial records and internal oversight are also subject to review by internal audit.

The Accounting Office’s Contracts and Grants Guidelines and Policies page provides an introduction to sponsored programs accounting for PIs/PDs. Personnel from the Accounting Office, as well as the ORSP Contracts and Grants Accountant, are available to assist and advise PIs/PDs on fiscal issues related to sponsored program management.