Unallowable Costs / Over Expenditures
It is the Principal Investigator’s (PI) responsibility to comply with all the financial terms and conditions of an award. This includes ensuring that costs are correctly charged to the restricted account according to the sponsor-approved project budget and the terms and conditions of the award.
Each expense charged to the account must be:
- directly related to the project,
- must be allowable under the terms and conditions of the award, and
- must be included in the sponsor-approved budget.
Any questions concerning the allowability of costs should be directed to ORSP staff prior to incurring the cost. ORSP staff can assist the PI in determining if the cost is allowable under the current budget or if a budget revision is required. While departmental administrators may assist PIs in managing their accounts, the PI is ultimately responsible for all costs charged to their restricted accounts.
ORSP staff monitor expenditures for compliance with University, state, federal, and sponsor guidelines to ensure policies are consistently applied. However, only the PI can verify that each individual expense is appropriate to the account. As a result, the PI and the PI’s unit are responsible for any over expenditures or any costs that are determined to be unallowable by ORSP or auditors. It is therefore critical that the PI carefully monitor all expenditures charged to his/her restricted accounts and implement procedures as necessary to ensure compliance with the terms and conditions of the award.
Resolution - Cost Transfer of Expenses
When an overbudget, unallowable expenditure, or expenditure after end date of the grant occurs, the post-award specialist will send an email notice to the PI requesting resolution within two weeks from discovery. The email will be copied to the PI’s 1) chair/dean, 2) departmental administrator, if applicable, and 3) the director of the ORSP:
Email from post-award specialist will contain something like: "Your grant account M2xxxx, Grant Title, Funding Agency, which ends mm/dd/yy is over budget by $xxxx in direct expenditures OR has an unallowable expenditure [described]. OR has an expenditure that is dated after the end date of the grant [described]. Please resolve this problem by [two weeks from date of email]. If you have any questions, please contact me immediately.”
Follow Up: If the problem is not resolved at the end of the two week period, the post-award specialist will send a follow-up email to the PI with copies to the ORSP director and the PI’s 1) chair/dean, and 2) departmental administrator, if applicable. This second email will include all email correspondence regarding this situation, and again will call for resolution. Additionally, it will clearly state that if the PI does not take action within an additional two week period, the expense(s) will be moved to the appropriate SPABA account 62899.