cost sharing. objectives review roles and responsibilities facilitate pro-active, continuous...

Cost SharingCost Sharing

ObjectivesObjectivesReview roles and responsibilitiesFacilitate pro-active, continuous

monitoring of cost share commitments

Review Cost Share Summary in PeopleSoft

2Sponsored Projects Training Program

Cost sharing: BackgroundCost sharing: BackgroundCost sharing – commitment of University

or third party resources to support part of the costs of a sponsored project◦Mandatory – required by the sponsor◦Voluntary – offered in the proposal but not

required by the sponsor

Once described in a proposal and accepted by the sponsor, cost sharing is committed and the obligation must be met


Cost sharing: BackgroundCost sharing: BackgroundReasons cost sharing occurs

◦Sponsor has defined F&A rate below negotiated rate

◦Sponsor requires that the institution contribute to project costs

◦ Individual’s salary is greater then federal agency’s allowable salary cap (NIH grants)

◦Voluntarily offered by the University as part of the proposal (strongly discouraged)

Cost share must always be documented and often reported to the sponsor


Cost sharing: ChallengesCost sharing: Challenges

Lack of complete understanding of the implications of cost share by the proposal developers

Often the chartstring for the source of cost share is excluded from or invalid on the proposal routing form

At times cost share items are not budgeted correctly in OPS_CH

Appropriate expenses are not charged against the project cost share chartstrings initially

Tool/report to pro-actively monitor cost share has not been available


Cost sharing: Roles and Cost sharing: Roles and ResponsibilitiesResponsibilitiesDepartment Chair, Dean, or other individual

making the financial commitment◦Approves unit commitments for cost sharing◦Aligns grant effort with overall workload

Principal Investigator◦Receives approval from individual responsible

for financial commitment decisions◦Ensures cost share requirements are met◦Obtains documentation for third party cost share◦Works with business unit administrator to

ensure cost share expenses are properly managed


Cost sharing: Roles and Cost sharing: Roles and ResponsibilitiesResponsibilitiesBusiness Unit Administrator

◦Confirms chartstrings for cost share commitments

◦Processes budget entries for cost share in OPS_CH ledger

◦Makes salary distribution changes to the project

◦Monitors cost share commitments in SP_CHILD2 and OPS_CH

◦Assists PI to ensure commitments are met


Cost sharing: Roles and Cost sharing: Roles and ResponsibilitiesResponsibilitiesOSP Pre-Award Services

◦Reviews proposal cost sharing requirements and conveys to principal investigators

◦Indicates approvals required for cost-sharing commitments on routing form

◦Includes cost sharing in OSP budget worksheet with appropriate approval

◦Obtains valid cost share chartstrings from PI and business unit administrator

Sponsored Projects Training Program 8

Cost sharing: Roles and Cost sharing: Roles and ResponsibilitiesResponsibilitiesGrant and Contract

Administrative Services◦Sets up cost share chartstrings and

records cost share requirements in PeopleSoft during award set up

◦Periodically audits cost share commitments and activity.

◦Completes and submits reports of financial activity, including cost share, to sponsors.


Cost sharing: Solutions & Cost sharing: Solutions & ImprovementsImprovementsIdentify all cost share and appropriate

sources during the pre-award processIndividual making the decision about the

financial commitment must also approve the cost share obligation and source

All cost share requirements entered into PeopleSoft by GCA during award set up

Include cost share details in award notifications to investigators and dept administrators

PI and dept administrator are responsible to monitor cost share commitments and ensure commitments are met


Monitoring Cost ShareMonitoring Cost ShareGCA sets up cost share chartstrings

in SP_CHILD2 in Commitment Control for all cost share commitments at award set up

Details about the cost share requirements are recorded in the Additional Information link on the Award Profile page (Grants>Awards > Award Profile)

Award set up notifications include the cost share requirements


Monitoring Cost Share: Monitoring Cost Share: Additional Information LinkAdditional Information LinkEffort

It is common for cost share requirements to be in the form of effort, which is tracked in PeopleSoft when the individual’s salary is distributed against a cost share chartstring in PeopleSoft. Actual salary and fringe benefits expenses are then recorded in the GL as part of the total project costs.

Example #1: cost share requirement is based solely on effort:

J. Smith 5% 7/1/09 – 6/30/1012

Sponsored Projects Training Program

Monitoring Cost Share: Monitoring Cost Share: Additional Information LinkAdditional Information LinkEffortExample #2: cost share requirement is a

specific dollar amount and is proposed to be met with effort:

J. Smith 5% 7/1/09 – 6/30/10Note: required cost share is 1:1, or $20,000,

or 25% of total project costsIf multiple departments are funding the same CS commitment:

J. Smith 5% 7/1/09 – 6/30/10 (51020)I. Jones 12% 7/1/09 – 6/30/10 (54080)

Department will monitor and adjust as needed to ensure commitment is met.

Sponsored Projects Training Program 13

Monitoring Cost Share: Monitoring Cost Share: Additional Information LinkAdditional Information LinkOperating Expenses

Cost share requirements are sometimes in the form of operating expenses, in which case the transactions should be allocated to the cost share chartstrings when initially processed. Again, the actual operating expenses are recorded in the GL as part of the total project costs.

Example:Travel $2,500 or Equipment $10,000


Monitoring Cost Share: Monitoring Cost Share: Additional Information LinkAdditional Information Link Third Party

Less frequently cost share requirements are met by a third party, such as another institution providing in kind effort on a project or a subrecipient providing cost share as part of the subaward agreement with UVM. In the case of in kind effort provided by another institution, the cost share is documented by a signed memorandum from the other institution to UVM indicating the names of the individuals who contributed effort, the associated salary and fringe benefits amounts, and the dates in which the effort was expended. For a subrecipient, the cost sharing will be documented on invoices provided to UVM and scrutinized by the PI, business unit administrator, and GCA prior to processing the invoice for payment.

Example:In Kind: Subrecipient X has committed $1,000 of cost share.Per Invoice #1234 dated 1/1/10, subrecipient X has

contributed $500 of cost share


Monitoring Cost Share: Monitoring Cost Share: Additional Information LinkAdditional Information Link Unrecovered F&A

Some sponsors do not pay UVM’s full, negotiated F&A rate so the difference between UVM’s actual F&A rate and the rate the sponsor reimburses is considered unrecovered F&A and quite often contributes to overall cost share commitments. In those cases, the unrecovered F&A is not budgeted in Commitment Control since there are not any associated financial transactions in Commitment Control or the GL, however the commitment is still noted in the Additional Information link on the Award Profile page.

Example:Waived F&ACost share commitments will be met with unrecovered F&A.


Monitoring Cost Share: Monitoring Cost Share: Additional Information LinkAdditional Information LinkNIH Career Development (K) Awards

NIH K awards have specific effort requirements and a cap on the amount of PI salary that the sponsor will pay (typically 75% effort with a maximum salary of $75,000 per budget year); anything over the maximum allowed amount must be cost shared. The cost share requirements will change each year, depending on sponsor terms & conditions and the PI’s salary.

Example:There is potential for cost share in future years. Please monitor regularly to determine if needed.


Monitoring Cost Share: Monitoring Cost Share: Additional Information LinkAdditional Information LinkSalary Cap

Some sponsors, most notably NIH, limit the salary that they will cover. These salary limitations are called salary caps. For example, if a sponsor limits salary to $190,000, and a PI earns $200,000 per year and expends 10% effort on an award that is subject to a salary cap, then $19,000 may be distributed to the sponsored chartstring and $1,000 must be cost shared.


Monitoring Cost Share: Monitoring Cost Share: Additional Information LinkAdditional Information LinkComplex Cost Share Requirements

A handful of awards have cost share requirements that are too detailed and complex to include in the additional information link. In those cases, GCA will note to see the proposal, budget worksheet, and award document for cost share requirements or will attach an excel spreadsheet detailing cost share requirements.


Monitoring Cost Share: Cost Monitoring Cost Share: Cost Share Summary ReportShare Summary ReportA cost share summary report has been

developed to monitor cost share requirements and ensure cost share commitments are met on an ongoing basis.

The report should be run and reviewed by unit business administrators at least quarterly to proactively manage cost share commitments and replaces the historic reactive approach to monitoring cost share.

GCA will use the same report to periodically audit cost share commitments and activity.


Monitoring Cost Share: Cost Monitoring Cost Share: Cost Share Summary ReportShare Summary ReportNavigation: UVM Reports > Cost

Share SummaryCan be run by Award Number,

Project ID, Operating Unit, Department, or PI ID


Monitoring Cost Share: Cost Monitoring Cost Share: Cost Share Summary ReportShare Summary ReportContains the

following fields:◦ Award Number◦ Reference Award

Number◦ Project Start Date◦ Project End Date◦ Sponsor Name◦ Project Description◦ Cost Share

Requirements (from Additional Info Link)

◦ Account◦ OU◦ Department◦ Fund

◦ Source◦ Function◦ Project◦ Program◦ Purpose◦ Property◦ Budget◦ Pre-Encumbrances◦ Encumbrances◦ Total Project Expenses◦ Year-to-Date Expenses◦ Remaining Balance


Cost Share Summary Report Cost Share Summary Report Data AnalysisData AnalysisDuring the quarterly cost share monitoring

process, unit business administrators will review:◦ Cost share budget, actuals, encumbrances, and

budget balances compared to project start and end date to ensure Commitments will be met by the end of the project

period Potential overdrafts in cost share chartstrings will be

resolved prior to the end of the project period

◦ Ensure PI and key personnel effort is not reduced by more than 25% of the commitment made to the sponsor

◦ Review budget checking errors to ensure all OPS_CH chartstrings have been appropriately set up


Cost Share ResourceCost Share ResourceCost Share Business Process &

Summary Job Aid◦May be accessed from GCA’s

webpage, under “GCA resources” (http://www.uvm.edu/~gcaacct)


ConclusionConclusionReviewed roles and

responsibilitiesFacilitate pro-active, continuous

monitoring of cost share commitments

Reviewed Cost Share Summary in PeopleSoft


Questions/Contact infoQuestions/Contact infoDean’s Office

Office of Sponsored Programs, Pre-Award Services◦ http://www.uvm.edu/~ospuvm/◦ Main Campus Office & Funding Information,

340 Waterman Building, 6-3360◦ Health Sciences Office, 231 Rowell Building, 6-

4067

Grant and Contract Administrative Services◦ http://www.uvm.edu/~gcaacct/◦ 223 Waterman Building, 6-1459


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