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Overspent Projects: Overspending on a sponsored research
PTAEO account can reflect poorly on the Principal Investigator, OSP, and
Dartmouth College. It can indicate the award was not planned carefully enough
to support a request of sufficient funding to complete the award. It can also
be seen as indication of haphazard internal financial management of a sponsor's
funds. Because the implications of overspending are so serious, a major
responsibility shared by the Principal Investigator and the Sponsored Research
Manager is to carefully monitor the budget.
If a sponsored research PTAEO account ends with a deficit, the
Principal Investigator's department or administrative area is responsible for
covering the remaining expenditures. For those sponsored research PTAEO
accounts that end with a deficit, prompt cost-transfer requests must be
submitted by the department or the administrative area. The cost-transfer will
initiate the process of moving remaining outstanding expenditures from the
sponsored research PTAEO account to the appropriate departmental GL
account.
Underspent Projects: While the financial implications of
under spending on a sponsored research PTAEO account are not nearly as
serious, severe under spending, 20% or more of an award's total direct costs,
can also reflect poor project planning, haphazard internal financial management
of a sponsor's funds, or that the goals of the award were not met.
There is little virtue in ending a sponsored research PTAEO
account with a large balance of funds. Rarely does the sponsor allow the
institution to keep the money. Rather, it must be returned to the sponsor where
it can create a fair amount of accounting inconvenience. Institutions that
return large unused portions of sponsored research funds are not rewarded for
their frugality.
This does not mean that there will never be instances when there are
legitimate reasons for major under spending of a sponsored research award. Nor
does it mean that unbridled spending of remaining sponsored research funds
should take place in the waning months of a project. Rather, careful planning,
monitoring, ongoing communication with the sponsor, and revising of the work
plan as needed should be the norm throughout the life of the award.
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