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Financial Compliance

Post-award associates are responsible for overall fiscal and administrative oversight of all extramural funding (sponsored awards) within their portfolios, including account setup, monitoring budget spending activity, billing and financial reporting, assuring projects comply with university, federal and sponsor regulations as the technical work progresses, and financial reporting to sponsors. Principal investigators are responsible for monitoring the day-to-day fiscal performance and technical progress of their sponsored award.

Best practices for monitoring:

  1. Assuring salaries and equipment are charged accurately. If a principal investigator identifies fiscal problems they should notify the office as soon as possible to assure cost transfers are done on a timely basis. If cost transfers are not made within 90 days of the original posting (including 30 days to get through the university accounting system), university policy 3255 Cost Transfers on Sponsored Projects, requires that supporting justification before transfers over 90 days may be processed. Further information may also be found in the Office of Sponsored Programs procedure 30004 Cost Transfers Associated with Sponsored Awards.
  2. Tracking budget reports carefully. If 80 percent of the budget has been spent, is the project roughly 80 percent finished? The earlier fiscal difficulties are identified, the more likely they will be solved without major expenditures by the college or department. If the project is overspent, the post-award associate will notify and flag the project. No additional expenditures can be posted until the overdraft problem is solved. The post-award associate can work to clear up any budgeting issues, and if necessary, transfer costs to the appropriate college or department overhead account. Further information may also be found in the Office of Sponsored Programs procedure 30004 Cost Transfers Associated with Sponsored Awards.
  3. Noting any restrictions placed by the sponsor on the expenditure of the funds. Sponsors often require advance approval for expenditures related to foreign travel, equipment not in the approved budget, general purpose equipment, subcontracting part of the project, or hiring outside consultants. Another key budgeting area that often requires the prior approval of a sponsor is a change in the amount of effort the principal investigator expends on the project. The post-award associate is responsible for working with the sponsor to obtain approval for any items requiring the sponsor's prior consent. If there is a need to obtain prior approval, contact the assigned Office of Sponsored Programs team member. The same holds true for all equipment requisitions and payment requests from subcontractors or consultants.

Cost sharing is a financial commitment by the university to share in the funding of a sponsored activity. The university often cost shares on an award by contributing a portion of the principal investigator's salary and benefits to the total amount of effort required on the award. Other types of cost sharing may include unrecovered indirect, tuition remission, contributions from the Virginia Tech Foundation, or state SCHEV funds. Cost share commitments are made with real dollars that flow directly from department coffers, and cost shared funds must be tracked and their obligations must be met. Sometimes sponsors may reference the word “matching” for cost sharing. Principal investigators and other departmental personnel can direct questions concerning cost sharing to a pre or post-award associate. 

Roles and Responsibilities in Cost Sharing

The Prinicpal Investigator and their Department

  1. Assure total promised commitment to the sponsor is fulfilled.
  2. Assure expenditures are reflected on the cost sharing account or are documented.

The Office of Sponsored Programs

  1. Set up a cost share fund in accordance with Form A.
  2. Track the actual amount of cost shared funds expended and notify principal investigator if cost share exceeds or does not equal required match. If Virginia Tech has committed cost share for an award, during award close out, the post-award associate will assure these obligations have been met and recorded by the end of the second full month following the award expiration date as required by university policy 3245: Cost Sharing on Sponsored Projects.
  3. Retain supporting documents on cost share for audit purposes.

The Office of Research and Innovation

Requests for cost-sharing from the Office of Research and Innovation need to be addressed to the Office of Research and Innovation at the proposal stage. If there are questions about receiving the State, SCHEV, and/or other non-overhead commitments from another department, they should contact that department directly.


Cost transfers onto sponsored projects are highly scrutinized by auditors. All non-salary and general wages cost transfers are processed using the university’s journal entry form and sent to the post-award administrator for review and approval. All cost transfers must comply with university policy 3255 Cost Transfers on Sponsored Projects.


All personnel cost related transfers should be done using a P-10, which is a mechanism departments use to transfer payroll charges from one fund to another. Salary related cost transfers are an after the fact transaction and require Office of Sponsored Programs approval when the transfer involves a restricted account and the payroll change is greater than 90 days after the end date. All cost transfers must comply with university policy 3255 Cost Transfers on Sponsored Projects.

Expenditures Incurred and Posted After the Period of Performance

A principal investigator and departmental fiscal personnel are responsible to ensure that all expenditures charged to a sponsored project are allowable and allocable. Expenditures must be posted to the sponsored project within its period of performance. It is extremely important to ensure that expenditures posted after the period of performance are allocable and directly benefit the project.

The Office of Sponsored Programs generates a transaction report monthly from Banner Warehouse for all expenditures posted on sponsored funds after the period of performance end date. Expenses procured via HokieMart or with a university purchase card that post to a sponsored fund after the period of performance will be reviewed by the Office of Sponsored Programs utilizing the receipt date to verify when the purchased goods or services were received. If the purchase was received within the period of performance, no action is required by the department. If the purchase was received after the period of performance, the office will contact the department to determine how the expense benefited the grant.

The department will be notified to provide an explanation within 10 business days from the original notice. The department will be given an additional five business days to remove the charge from the sponsored fund if it is determined to be unallowable.. If the unallowable expense is not removed within five business days, the Office of Sponsored Programs will initiate a journal entry/labor redistribution to move the charges to a default fund provided by the Controller’s Office.

If the grant’s period of performance is extended, then further action is not required. If the grant is pending an extension, and the modification is not received from the sponsor within 90 days from the grant end date, the department will be requested to complete a letter of guarantee or remove the expense from the sponsored fund. The department may return the expense to the grant fund when the extension is received.

Effort reporting is the mechanism used to confirm, after the end of the reporting period,  salaries and wages charged to sponsored awards are reasonable in relation to the actual work performed. All effort reports are now being processed electronically using the web-based effort reporting system.