• 1. Why is the time period 90 days?

  Ninety (90) days has emerged as the standard used by government and business auditors to determine whether costs are reasonably assigned to their proper project and function. It is a standard established in federal circulars and grant policy. Standard practice should be to post costs to the most appropriate project/grant. However, subsequent adjustments may be necessary, for example to account for unseen shifts of personnel between closely related sponsored projects, or to correct errors. These actions are reasonable if transferred within 90 days.

• 2. How do you calculate the 90 day period?

  The 90 days begins at the end of the accounting month that the original transaction is posted in WISDM. The “clock” runs until the transfer has been prepared and all departmental signatures have been obtained. Processing time in the Dean’s Office, Research and Sponsored Programs, and Accounting Services is not included in the determination of whether a transfer has met the 90 day criteria. For example, if a travel expense charge is posted 9/12, the accounting date would be 9/30. Transfers completed and signed by 12/31 would fall within the 90 day period. Transfers completed and signed after that date would be considered late cost transfers.

• 3. Is this standard applicable to all sources of University funds?

  No, the 90-day standard is being applied only to sources of extramurally sponsored University projects that are in fund 144 and sponsored projects in fund 133. Although this standard is not a requirement for other funds or gift accounts in fund 133, it should be considered useful guidance. It is important for the University as a whole to record its costs (and associated revenues) in a timely fashion. The accuracy and auditability of its records are improved when postings and corrections are made in a timely manner.

• 4. Is this standard applicable to all my University Sponsored Projects?

  No, this standard is only applicable to all extramurally sponsored University projects and activities in fund 144 (Federal) and fund 133 (Non-Federal). If you have projects managed in other fund sources (101, 135, 136, etc), the 90 day-standard is not a requirement. It should be considered useful guidance.

• 5. Is this standard applicable to salaries?

  Yes, this standard is applicable to salary expenditures. It is especially important that, to the extent possible, payroll expenditures are budgeted and recorded on the proper project/grant at the time of their occurrence.

• 6. Can I wait until our department completes its effort reports before submitting salary transfers?

  Generally not. The intended use of effort reports is not as a check of where salary charges are made. Salary distributions should be reviewed on a regular basis so the effort reports are a reasonable reflection of the employee’s paid effort when first generated. There may be situations where changes are needed to the effort reported and the corresponding salary transfer is needed. The transfer may be appropriate, but because it is beyond 90 days the transfer would also need to meet the extenuating circumstances.

• 7. How should research expenditures for project work be recorded before a sponsored project is established?

  The College/School Dean’s Office can assist in establishing an Account Number in Advance of Award (RSP form 88-1). It is not appropriate to use a generic discretionary account and move expenses to the funded award beyond 90 days.

• 8. What if a vendor doesn’t provide an invoice for services rendered within 90 days?

  Although rare, this circumstance can occur and may be an acceptable circumstance for a late transfer justification. The University cannot pay for services for which it has not been invoiced. Vendors should be contacted immediately and urged to submit outstanding invoices or risk the possibility of non-collection due to lapsing funds. If a vendor invoices later than 90 days after the provision of services, the University will pay upon receipt and note for the record that the invoice was late.

• 9. What if a program is disputing an invoice with a vendor and the dispute extends beyond 90 days?

  The dispute should be clearly documented between the program and the vendor. The University has an obligation to notify vendors in a timely manner if goods and services are not satisfactory and to timely pursue resolution of outstanding issues. Delays due to the normal course of other business intervening, change in personnel or other departmentally based factors are not acceptable reasons for delaying posting of expenditures.

• 10. Is it allowable to place charges on a single MDS account, or other internal vendor account, but then transfer/reallocate these costs to several other 144 accounts?

  To adhere to the University of Wisconsin-Madison policy that costs be charged to the appropriate sponsored project when first incurred, separate MDS account numbers for each sponsored project is the preferred method. Federal accounts (Fund 144) cannot be used as the default project/grant. The charges must be reallocated by the PI or designee.

• 11. If I miss my biweekly pro-card account rollup, and I then have to process cost transfers, will they be approved?

  Research and Sponsored Programs strongly recommends that all pro-card purchases be allocated appropriately to the correct account during the biweekly pro-card edit period. Cost transfers within 90 days of the transaction date would be allowable for missed biweekly pro-card account rollups with proper justification.

• 12. If a PI requests a salary transfer for a student and then two months later requests another transfer of the same charge to another project, what do I do?

  It is the University of Wisconsin-Madison policy that costs be charged to the appropriate sponsored project when first incurred. Unless there are extenuating circumstances clearly explained in the cost transfer justification, a second transfer on a 144 transaction is unallowable. At no time should sponsored projects be used as back-up projects or as discretionary projects for expenses that will subsequently be transferred elsewhere.

• 13. After a 133 or 144 cost transfer arrives at 21 N. Park St., how long does it take to be reflected on the account?

  Cost transfers are processed in Research and Sponsored Programs as quickly as possible (two to five days) and then submitted to UW-Accounting for entry into the SFS. Cost transfers involving multiple accounts may have a slower processing time in RSP if the accounts have different funding agencies. Different RSP accountants handle different sponsors; and each RSP accountant must approve charges on the cost transfer for their respective assigned funding agency(s). Because of workload variation or accounting calendar requirements (such as month-end close-out), departments should allow adequate processing time before the transfer appears in WISDM.

• 14. Are generic statements such as “transfer to appropriate funding source” and “to reflect additional efforts” sufficient justification for transfers less than 90 days?

  Generic statements are not generally acceptable on extramural support cost transfers. For all charges on a project, you should be able to explain the allowability of those costs. As general guidance, acceptable justifications should be able to address the following: An explanation as to why the expense was originally charged to coding from which it is now being transferred. An explanation as to why the charge needs to be transferred to the proposed receiving project. An explanation as to why the charge is allowable and allocable based on the terms and the conditions of the receiving award. For cost transfers after 90 days of the accounting date, the justification must include the items above as well as two additional items: Why the cost is being transferred more than 90 days after the accounting date. What corrective action has been taken to eliminate the need for cost transfers of this type in the future at the departmental level.

• 15. If my cost transfers have been delayed several months because of the limitations and problems of WISDM financial data, is that a valid reason for approving my late cost transfer?

  When the cost transfer is necessary due to a specific WISDM problem and adequate justification is provided on the cost transfer form, Research and Sponsored Programs would consider this as an allowable extenuating circumstance. Justifications such as “WISDM problem” would not be an acceptable justification and would not be allowed/approved.

• 16. May I use a cost transfer to “spend down” an account that is nearing its end date?

  If the cost transfer does not meet the standards for allowability, allocability and reasonableness, it will not be approved.

• 17. There is a staffing shortage in our department and I am doing payroll, department administration, grant accounting, etc. Many times my transfers are past 90 days. Will they be approved?

  Staff shortages or lack of staff experience are unallowable circumstances for late cost transfers. Auditors typically view this explanation as a sign that the department does not provide adequate monitoring or maintain sufficient internal control over the use of extramural funds. The College/School and the PI have a responsibility to ensure the availability of qualified staff to administer and exercise stewardship over sponsored projects in accordance with the sponsor’s policies and regulations, including those relating to regular monitoring of expenditures and timely correction of errors and reallocation of expenses.

• 18. A contract has been in negotiation for 5 months and the account has now been set-up. Work started and costs were charged to our department 133 account. Can I now transfer 5 months of salary expense to the new account?

  A five- month contract negotiation would be considered an allowable extenuating circumstance. The five month salary transfer should be submitted as soon as the PI knows the new account number. Supporting documentation/justification is required with the transfer. To avoid this extenuating circumstance, Research and Sponsored Programs recommends that an Account Number in Advance of Award (RSP Form 88-1) be established, which is done at the request of the Principal Investigator or designee.

• 19.  I need to move several months of an individual’s salary. A portion, but not all, of the amount to be transferred has been on the current account for over 90 days. Do I need to complete two justifications: one for the late justification and one for the portion that is timely?

  No, you will only need to complete one justification. However, because some of the charges were on the account for over 90 days before a correction was initiated, you must complete the late cost transfer justification form.

• 20. I need to do a transfer because of an error created in another department or unit of campus. When I write my justification, should my explanation specify the other unit by name?

  Yes. While no one likes to point fingers or blame others for mistakes, it is important to explain the reason for the transfer. Areas that consistently make errors need additional attention and training to help them understand the complications they create. Over the long-term, campus will be working with these units to improve their operations so fewer errors, and corresponding transfers, occur.

• 21. Are clinical trials included under this policy?

  Yes. Although it may be difficult to determine the final budget on a a clinical trial, it is important that costs related to that specific trial be recorded to the appropriate funding source at the time they are incurred. Costs related to a specific clinical trial should not be charged to another sponsored project while the final budget of a clinical trial is being determined. Federal circular A-21, section C.4.b specifically prohibits transfers related to deficiencies due to cost overruns or other funding considerations, as well as transfers for reasons of convenience.

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