Policy Title: Sponsored Reallocation of Charges & Cost Transfer Policy
Policy Statement: It is the policy of Dartmouth College that costs should be charged to the appropriate sponsored award when first incurred. However, there are circumstances where it may be necessary to transfer expenditures to a sponsored award subsequent to the initial recording of the charge. It is the policy of Dartmouth College that charges to sponsored funds be reviewed on a regular and timely basis to assure appropriateness of charges and to prepare corrections on a timely basis.
Reason for Policy: To comply with allowability and allocability requirements of Office of Management and Budget (OMB) Circular A-21 and to promulgate best practices for all sponsored awards (federal and non-federal), it is necessary to explain and justify the transfer of charges to federal awards from other federal or non-federal accounts. Timeliness and completeness of transfer explanations are important factors in supporting allowability and allocability in accordance with the principles set forth in the Circular. The transfer of charges from general ledger accounts and other sponsored projects or programs to sponsored research awards is closely examined by auditors. Frequent, tardy or unexplained (or inadequately explained) transfers can raise serious questions about the propriety of the transfers and our accounting system and internal controls.
Affected by this Policy: Any Dartmouth College Department who manages Federal and Non-Federal Sponsored Awards.
Who Should Be Aware of this Policy: Office of Sponsored Projects Staff, Dartmouth College Departments who manage Sponsored Awards, Principal Investigators and Other Faculty involved with Sponsored Awards, Divisional Financial Administrators and Central Financial Administrators.
Contacts: Please direct general questions about this policy to your unit's administration. If you have questions about policy issues, please contact the Director of the Office of Sponsored Projects. If you have questions about process issues, please contact your OSP Sponsored Research Manager.
Simple Reclassification: Simple reclassification's are timely correction of errors made within the month following the accounting period of the original GL Transfer Date. This would include:
Additionally, there are other instances where a simple reclassification would apply if the correction is being made within 90 days:
Preparing Simple Reclassification's: Department Grant Managers or Finance Centers prepare a SPUD Journal Form (Non-Payroll) or a Wage Transfer Form (Payroll). Once the appropriate form has been completed, the Department Grant Manager or the Finance Center can email an Excel copy of the SPUD Journal Form and a PDF copy of the Wage Transfer Form to their OSP Sponsored Research Manager.
Simple Reclassification Approvals:
Processing Simple Reclassification's:
Cost Transfers: Cost Transfers are transactions that move a previously recorded expense which typically involves a PTA Account. There are two types of transfer forms, Cost Transfer Forms (Non-Payroll) and Wage Transfer Forms (Payroll) that are used to move these types of transactions. Cost Transfers do not include Simple Reclassification's. All Cost Transfers require adequate justifications which include answering the following questions on the forms:
If the original transaction was incurred more than 90 days preceding the transfer request, the justification must also address:
Cost Transfer Documentation: Cost Transfer Forms require adequate documentation (examples include IRA OGA Transaction Detail - Expenditures Reports, Invoices, etc.) to support the transactions being moved.
Timely Submissions of Cost Transfers: Each Cost Transfer should be completed within 90 days of the date of the incurrence of the original expense. Cost Transfers over 90 days will only be approved under extenuating circumstances. Examples of Acceptable Extenuating Circumstances for Cost Transfers over 90 calendar days (note that all of these exceptions still require submission of the Cost Transfer Form and Wage Transfer Form):
Please Note: Acceptable extenuating circumstances do not include Absences of the PI or Administrator, Lack of Staff, Inexperienced Staff, or Lateness of Reconciliations.
Preparing Cost Transfers: Department Grant Managers or Finance Centers prepare a Cost Transfer Form (Non-Payroll) or a Wage Transfer Form (Payroll). Once the appropriate form has been completed and signed, the Department Grant Manager or Finance Center can email an Excel and PDF copy of the Cost Transfer Form and a PDF copy of the Wage Transfer Form to their OSP Sponsored Research Manager.
Cost Transfer Approvals:
Processing Cost Transfers:
Process: See the below link for the Reallocation of Charges Process Flow Chart which describes requirements, forms, and approvals.
Related Documents & Tools:
The NIH Grants Policy Statement (REV. 12/03, pp.83-84) http://grants.nih.gov/grants/policy/nihgps_2011/
OMB Circular A-21 http://www.whitehouse.gov/omb/circulars_a021_2004
Cost Transfer and Wage Transfer Forms http://www.dartmouth.edu/~osp/resources/forms.html
NIH Grants Policy Statement:
"Cost Transfers to NIH grants by grantees...should be accomplished within 90 days...The transfers must be supported by documentation that fully explains how the error occurred and a certification of the correctness of the new charge by a responsible organizational official of the grantee...An explanation merely stating that the transfer was made "to correct error" to "transfer to correct project" is not sufficient. Transfers of costs from one project to another or from one competitive segment to the next solely to cover cost overruns are not allowable. Grantees must maintain documentation of cost transfers, pursuant to 45 CFR 74.53 or 92.42 (record retention requirements) and must make it available for audit or other review...Frequent errors in recording costs may indicate the need for accounting system improvements and/or enhanced internal controls.
Last Updated: 7/3/14