NJIT Implementation of Recent Executive Orders

Institutional Response on the Implementation of Recent Federal Executive Orders with Updates on Federally Funded Research Grants and Contracts

Financial Management

    

Post-Award Management

All grant transactions are initiated by the departmental support staff upon the direction of the Principal Investigator responsible for the award.  These transactions must align with the executed award agreement and budget plan.

Budget Revisions

The Principal Investigator may need to request a Budget Transfer when the budget needs to be adjusted to reprogram grant funds from original budget due to anticipated program needs.

Regular monitoring allows the PI to adjust the spending plan prospectively and obtain any necessary approvals prior to spending.

For a copy of the form and submission of budget revisions requests, please contact your assigned grant accountant under Post-Award management section of the Contact us page.

Some budget transfers will require additional levels of approval if they have an impact on the following categories. PI must obtain Chair/Dean Approval if:

  • Transfer of Academic Year release time to summer salary or to any other category.
  • Reduction in student support (Stipend and/or Tuition)
  • Reduction in F&A (Indirect/overhead costs charges)

Sponsor Agency Approval may be required for the following examples and will only be transferred when said approval is documented:

  • Changes in Indirect Costs
  • Changes in Academic Year Release Time or other key personnel or percentage effort
  • Changes in Student Support (Stipend and/or Tuition)
  • Exceeds allowable limit threshold for re-budgeting
  • Changes to Equipment
  • Changes to Subcontracts
  • Reduction to Participant Support

Policy: Budget and Expenditure Monitoring for Sponsored Research Programs
Resource: Prior Approval Matrix across multiple federal agencies: Budget Change Approval Matrix
Form: Budget Transfer Request

Cost Transfers

All sponsored award expenditures should be initially charged to the correct sponsored award because of the direct impact it has for the aims of that project. However, occasionally expenses are charged erroneously. When an erroneous entry affects a sponsored award, the correction must be made on a timely basis and sufficient information must be provided to allow for a clear audit trail back to the initially recorded expense.

A cost (expense) transfer – is an after-the-fact movement of costs (labor and non-labor) from a sponsored or non-sponsored award to another sponsored award.  This is completed when expenses needs to be reallocated retroactively from one index to another whereby one or both of these is a sponsored award.

Requirements:

  • These cost transfers require proper documentation of the original expenses to be reallocated.
  • Justification/explanation are needed for transactions greater than 90 days.  Any adjustments done greater than 90 days, give the perception that grants aren’t being monitored regularly and are an audit flag.
  • These instances require additional documentation, clear explanations and corrective actions to prevent future errors.

Grants should be reviewed at least quarterly to identify if any adjustments are needed.

Acceptable Reasons for a Cost Transfer

  • Clerical Error – These are typically data entry errors such as transpositions.
  • Pre-Award Costs – Costs incurred prior to receiving an award and setup on a non-grant fund. In no case, may an existing sponsored project index be used as holding account for pre-award costs on a pending award.
  • Costs Benefiting More than One Project – “If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost must be allocated to the projects based on the proportional benefit.   If a cost benefits two or more projects or activities in proportions that cannot be determined because of the interrelationship of the work involved, then…the costs may be allocated or transferred to the benefited projects on any reasonable documented basis.” 
  • Continuation of a Sponsored Project or Program – If the continuation has another index and the expenses are in the initial index, these may be legitimately moved to the continuation award in accordance with the terms of the new award..

Inappropriate Reasons for Cost Transfers

OMB federal regulations state that any cost allocable to a Federal award may not be charged to other Federal awards to overcome fund deficiencies, to avoid restrictions imposed by regulations of terms and conditions of the Federal award, or for other reasons (eCFR 200.405).

In addition, it is strictly prohibited to allocate expenses on a federal award due to delay in funding from another source with the intent to move it when it comes in. This is called “Parking of Expenses” and it is not allowed.

Examples of other unallowable cost transfers are:

  • To cover cost overruns or deficit balances in other non-grant or grant funds
  • To utilize unexpended funds of a sponsored award
  • To use for cost management strategy
  • Used any other reason of convenience

Policy: Cost Transfer Policy
Resource: Expense Account Codes Listing-Finance
Form: Cost Transfer Request

Personnel (Labor) Adjustments

To ensure proactive personnel management on awards, regular review by department/PI on a monthly, or at least quarterly, basis to determine adjustments or updates needed to be processed promotes effective grant management.

When reviewing your monthly grant payroll reports, any corrections or adjustments should be done upon discovery so that these changes would have taken effect in time for the creation of the effort reports. This will reduce the need to make corrections during the open review period so the submission of the time and effort certification can be completed by the deadline.

Realignment of Personnel Expenses

As a grant is approaching 90/60/30 days prior to expiration of funding, the Principal Investigator with departmental administrative support, must take proactive measure to avoid employees falling off payroll. 

One of the following steps must be taken:

  • Submit Personnel Action Form (PAF) with future effective start date on the new funding source.
     
  • If anticipated grant balance and work continuation is expected on the grant, submit a No Cost Extension (NCE) request at least 90 days prior to grant end to allow reasonable time for sponsor response and updating in Banner.  Contact your College Office of Research liaison to initiate the NCE request.
     
  • If there is no continued grant funding established but you anticipate additional funding, these personnel can be moved to a non-grant funding source approved by your College Dean until your external funding is received. 

Otherwise, contact your College Office of Research liaison to inquire about an Advance Account request. Note: You will need to provide evidence from the sponsor to support that the grant is imminent and this will need to be approved by leadership. See link: Advance Account Requests for Sponsored Research

An updated PAF must be sent to Human Resources by the PAF processing deadline for the payroll in which their end date occurs for each of these scenarios.  A link to the payroll and PAF processing calendar can be found here.

Any ineligible expenses on the grant beyond the grant end date will need to be removed and covered by your area if proactive measures are not taken to ensure timely reallocation of personnel. 

Labor Redistribution (Recasts)

Given that a timely review of monthly grant payroll reports is expected, labor transfers should occur infrequently and must include detailed documentation as to why the transfer is required. Written justification and PI approval for the labor transfer for sponsored awards is required and must be provided on the cost transfer form upon request from the grant accountant.

For non-sponsored funds, approval from the Budget Administrator or appropriate delegated authority is required.

Resource: eCFR 200.430 Compensation-Personal Services
Resources: Labor Redistribution-Finance Site