Advance Account Requests for Sponsored Research

I. Policy Summary

This policy governs the establishment of Advance Accounts (Pre-award spending) for Principal Investigators (PI) at NJIT. It allows for the commencement of project-related activities prior to the formal execution of an award when there is high certainty of funding. This ensures project continuity while maintaining compliance with federal "Allowable Cost" standards.

II. Policy Purpose

The purpose of this policy is to facilitate timely project starts and minimize retroactive cost transfers. Under 2 CFR §200.458, certain costs incurred prior to the effective date of the federal award are allowable only with written approval from the Federal awarding agency or as authorized by the institution under expanded authorities.

This policy:

• Standardizes the workflow for advanced account requests.
• Mitigates institutional risk if an award is not finalized or the terms change.
• Ensures all pre-award expenditures meet the three pillars of federal cost principles: Reasonableness, Allocability, and Consistency.

III. Policy Scope and Applicability

This policy applies to all sponsored projects, including federal, state, and private grants/contracts, administered through the NJIT Office of Research.

IV. Definitions

• Advance Account: An institutional fund (index) created prior to the official award start date to capture allowable expenditures.
• Allowable Costs: As defined by 2 CFR §200 Subpart E, costs must be:

1. Reasonable: Necessary for the performance of the project and what a "prudent person" would spend.
2. Allocable: Specifically identifiable to the project in proportion to the benefit received.
3. Consistently Applied: Treated the same way (Direct vs. F&A) under like circumstances.

• Uniform Guidance (UG): 2 CFR Part 200, the federal framework for managing grants.

V. Policy Statement

A. Risk Assessment and Negotiation

Establishment of an advanced account involves institutional risk. The Office of Research will assess the "imminence" of the award. Areas of concern that may delay or prevent account setup include:

• Restrictive publication or intellectual property clauses.
• Uncertainty regarding the final period of performance (start/end dates).
• Potential for significant changes in the Scope of Work (SOW).

Note: The PI and their respective Department/School assume full financial responsibility. If the award is not realized or costs are deemed unallowable by the sponsor, the Department must provide a non-sponsored collateral index to cover the expenses.

B. Consultant and Subrecipient Restrictions

Advance account authority is non-transferable. NJIT does not authorize pre-award spending for subrecipients or consultants until the prime award is fully executed, and a formal sub-award is issued.

C. Equipment Procurement

Under Uniform Guidance, equipment purchases are generally discouraged during the pre-award period. Any such purchase requires specific justification and written approval from the Senior Vice Provost for Research to ensure compliance with 2 CFR §200.313.

VI. Procedures

A. Request Requirements

A PI may request an advance account for up to 90 days prior to the anticipated start date if:

1. The proposal has received official institutional endorsement.
2. The PI provides written evidence (e.g., an email from a Program Officer) that an award is forthcoming.

B. Account Scenarios

 C. Monitoring and Closeout

• 90-Day Review: If no award is received within 90 days of account setup, the Office of Research may issue a "Stop Work" order or require a formal extension request.
• Conversion: Upon award acceptance, the post-award unit will remove the "Advance" status and reconcile all charges.
• Ineligibility: Human and Animal subject research (IRB/IACUC) cannot commence until all ethical approvals are active, regardless of account status.

VII. Roles & Responsibilities

• Principal Investigator (PI): Initiates request, provides "imminent" documentation, and monitors spending to ensure it remains within the proposed budget.
• Department Chair/Dean: Reviews and acknowledges financial liability for the "at-risk" funds.
• Office of Research: Validates sponsor terms, assesses risk, and provides final institutional authorization.
• Post-Award Management: Converts the account to "Active" status upon receipt of the final Notice of Award (NoA).

VIII. Authority and References

• Institutional Authority: NJIT Office of Research.
• Federal Authority: 2 CFR §200 (Uniform Guidance).
• Sponsor Specifics: NIH Grants Policy Statement (Part 7.5); NSF Proposal & Award Policies & Procedures Guide (PAPPG).