Research & Cost Accounting

Cost Sharing

These procedures are issued in accordance with Research Policy 306, Cost Sharing.

They are intended for guidance on post-award administration of cost sharing expenditures. Cost shared resources and costs must be proposed, tracked, expensed, and recorded per Rice policy and procedures and per sponsor guidelines.

General Information

The Principal Investigator (PI) bears primary responsibility for management of the sponsored programs that are awarded to him/her.  Management involves budgetary and cost compliance as well as technical compliance. This includes not only staying within the total program budget and time period, but also staying within specific budget guidelines in the award.  While all providers of committed cost sharing are responsible for honoring their cost sharing commitments, the PI is expected to monitor and coordinate the funding and recording of cost sharing expenditures.  The PI should request assistance from the Chair and Dean as needed to resolve variances between agreed-upon cost sharing commitments and funding or expenditures.

Commitments of University resources, including academic year time, must be approved in accordance with the cost sharing policy and the cost sharing proposal procedures of the Office of Sponsored Research (OSP) prior to proposal submission. 

Definitions

Cost sharing is that portion of total project costs not provided by the sponsoring agency.  Per Uniform Guidance, all costs that are reported as cost sharing must be allowable, allocable, and reasonable, incurred within the project period, derived from non-federal sources, used as cost sharing for only one project, and certifiable through university accounting records.

There are three types of cost sharing: mandatory, voluntary committed and voluntary uncommitted.

• Mandatory Cost Sharing is required by the sponsor as a condition of funding. It is described in an agency's program announcement and noted in the award document of the approved budget. It must be included in the proposal as a condition of submission and receipt of the award. This type is also referred to as Committed Cost Sharing .
• Voluntary Committed Cost Sharing is not required by the sponsor but has been included in the proposal in a quantifiable manner. See the OSP proposal procedures for examples of quantified voluntary committed cost sharing. Some sponsors do not allow proposals to include voluntary committed cost sharing.
• Voluntary Uncommitted Cost Sharing is cost sharing that has been recorded in the accounting system but is neither mandatory or voluntary committed cost sharing. If a PI chooses to report voluntary uncommitted cost sharing on a project, it is recorded in the accounting system but is not reported to the sponsor.

Sources of Cost Sharing

The following terms are commonly used at Rice when describing the sources of cost sharing.

• Cash: Funds expended from departmental  funds used to fulfill cost sharing obligations for expenditures such as equipment, salaries, travel, supplies and other direct costs.
• In-kind: Non-cash contributions contributed such as time, equipment, or facilities. Value is measured based on fair market value of goods and services received.
• F&A: Facilities and Administrative (F&A) costs related to the direct costs. F&A is budgeted and charged on the cost share project. Since cost share is funded internally with departmental funds, F&A revenue will not be generated on cost share expenses.
• Third party: Used for non-Rice cost sharing providers, both subawardees and others, that commit cost sharing during the proposal process. OSP reviews cost proposals from third parties to ensure they meet Uniform Guidance requirements for valuation. For subawardees, SPARC includes such cost sharing commitments in award documents. For non-subawardees, PIs are responsible for certifying that cost sharing commitments from them have been met. See Other third party commitments of cost sharing below.

Departmental Administrator Responsibilities for Committed Cost Sharing

At the time of setup of a new award with cash cost sharing, department requests RCA setup a cost share project to be used for recording cost sharing expenditures on the award.

The PI/Project Manager is notified of the cost share project number. The Project Manager of the award is responsible for ensuring funding is available in the project organization to fund the cost share expenses. As expenses are incurred on the cost share project, the departmental account funding cost share will be reduced.

Large/Multi-Department Projects

Large/multi-department projects frequently have a number of cost sharing providers across departments and schools.  The sponsors of these projects also generally request annual revised budgets that may affect previously submitted cost sharing commitments. For such projects, the departmental administrator of the main/contact PI should have periodic meetings with the departmental administrator of the other providers to ensure that cost sharing commitments are being met and appropriately recorded. Additionally, the departmental administrator of the main/contact PI is responsible for ensuring that OSP has a copy of revisions to the cost sharing commitments.

OSP Responsibilities for Committed Cost Sharing

OSP is responsible for reviewing proposal cost sharing commitments for compliance with Rice policy and sponsor requirements and for ensuring that needed documentation of cost sharing commitments is available. If the proposal commits cost sharing by subawardees, OSP will ensure that subaward documents require the cost sharing to be certified to Rice. If there are changes in cost sharing commitments or providers, the PI should contact OSP, who will then contact the sponsor as needed. 

RCA Responsibilities for Committed Cost Sharing

At the time of award setup, RCA reviews all proposal and award documents for cost sharing commitments. When a commitment is identified, RCA creates a separate project under the award for the cost share expenses. RCA reports the cost sharing commitments to the award sponsor.

Tracking Cost Sharing Expenditures

Since cost share expenses are being managed as a companion account under the award alongside the external award projects, tracking cost share expenses will be easily done in the iO user interface or in the dashboards. It is the responsibility of the PI/ Departmental administrator to ensure that cost shared expenditures are recorded properly when expenses are entered in iO. 

Subawardee Commitments of Cost Sharing

If a cost sharing commitment from a subawardee is required, OSP includes the provision in the award document that invoices must include cost shared amounts. 

Other Third Party Commitments of Cost Sharing

If there are other third party cost sharing commitments in the proposal, OSP will obtain documentation from the provider that will support the value of the cost sharing. At the end of the project, RCA will request PI certification of fulfillment of the third party commitment. 

Closeout

At the end of the project, in the event that documented cost sharing expenditures are less than the cost sharing commitments, the PI has the following options:

• provide documentation and support for additional cost shared expenditures;
• request sponsor approval through OSP to reduce cost sharing commitments; and/or
• reduce sponsored project fund expenditures to record them as cost sharing.

(From the OSP proposal procedures: “If at any time the PI becomes aware that not all of the cost sharing commitments can be met, the PI must notify OSP and RCA at once and provide a reason why the commitments cannot be met. If it is determined that a reduction is necessary, then OSP will notify the sponsor and request a reduction of the commitments. Depending on the circumstances, the sponsor may approve the request or reduce the sponsor share of the project costs accordingly.”)

RCA prepares the final cost sharing expenditures report and submits it to the sponsor as required. A copy of the final report is retained in the RCA files.

Procedures updated 6/7/2021

Cost Transfer

These procedures are issued in accordance with Policy 302, Cost Transfers.

Definition

A cost transfer is a reallocation of cost, from one project to another. Although occasionally necessary, federal regulations discourage and in certain instances disallow the movement of such expenditures. The purpose of this procedure is to ensure compliance with sponsored project and university policies and guidelines related to transfers of expenses. This procedure is applied consistently to all Rice University sponsored projects.

In the case of a sponsored project, a cost transfer is a reassignment of expenses either between similar sponsored projects, or between a sponsored project and a non-sponsored project. A cost transfer does not include:

• Reclassification of costs (e.g., correcting an expenditure type) within an award
• Transfer of costs within an award between projects
• An initial allocation of a charge from a clearing (default) project
• Data entry/data conversion corrections of labor distributions

These types of actions are not considered a cost transfer for the purposes of Policy 302.

Documentation

Cost transfers must be sufficiently documented in accordance with the provisions of the Office of Management and Budget (“OMB”) as part of 2 CFR Part 200, Subpart E. These standards require that accounting records include cost accounting records which are supported by source documentation. This documentation will assist in determining the reasonableness, allocability and allowability of the cost in accordance with the terms and conditions of the award.

Background

The Principal Investigator (PI) is responsible for the management of sponsored projects that are awarded to them. These include federal, state, and private grants and other sponsored agreements.

In addition to technical compliance, the responsibility for budgetary compliance rests with the PI. Each PI is responsible for ensuring that charges made to a particular award are allowed by the funding source and are directly related to the award or activity supported by that award. The PI should carefully consider whether an expense is an allowable, allocable and reasonable cost on a given award before the expense is incurred.  In addition, the PI is responsible for reviewing expenses monthly.

Cost transfers are sometimes necessary and unavoidable; however, they should not be used as a method for routine expense management. They may be used to correct an error or to allocate expenses between closely related projects if both projects benefit directly from the expense. Cost transfers should not be requested simply to avoid over expenditure in one research award by transferring expenses to another research award, nor should they be used as a method to spend money because a project is nearing its end. Unallowable or inappropriate charges that appear on a sponsored project award must be moved to faculty fund project promptly.

Frequent, tardy, or insufficiently justified transfers raise serious questions about the propriety of the transfers, the overall reliability of the University’s accounting system, the ability of the PI and departmental staff.

Timely

In accordance with the Cost Transfers policy, cost transfers submitted later than 90 days from the end of the month in which the charge first appears on the award or submitted later than 30 days after the end date of an award are not considered timely. Cost transfers not submitted in a timely manner must also include:

• Approval of the department chair of each department (see Properly Approved, below).

• Additional documentation if expenses are to be charged to another sponsored project

• An explanation of the delay in processing the cost transfer.

  • Include information on what steps are being taken to prevent future similar delays.

Well-Documented

In addition to providing information on the original posting from iO, a cost transfer request on sponsored projects must include:

• A full explanation of how the error occurred.

  • Why the expense was originally not known at the time of the original charge.

  • How the expenditure directly benefits the project receiving the charge.

  • A generic statement such as “to correct error” is insufficient and will not be accepted.

See the Cost Transfer Justification Samples for examples.

Properly Approved

• The PI or designee must approve cost transfer requests before they are submitted. The PI or PI designee approval certifies the correctness of the proposed cost transfer.

• Cost transfers that are not timely also require the approval of the chair of each department affected by the cost transfer.

Cost Transfer Process in iO

The process for cost transfers in iO is dependent on the transaction source (converted or iO created) and the transaction type (labor and non-labor). 

Cost Transfers for Costs Incurred Prior to July 1 (Both Labor and Non-Labor Converted Costs)

• Converted costs will be managed in iO using the Non-Labor Cost Transfer Form.  For the costs to be transferred, a description of the cost transfer as well as the invoice information must be entered, as well as the current and new COA and POET accounting information. RCA will enter the information into the PPM Project Costs ADFDI template and upload into iO.

• Converted costs cost transfers are to be requested by the Department Administrator and uploaded to BOX for processing.

Cost Transfers for Non-Labor Costs Incurred After July 1

• Cost transfers for non-labor costs will be managed in iO using the Non-Labor Cost Transfer Form. For the costs to be transferred, a description of the cost transfer as well as the invoice information must be entered, as well as the current and new COA and POET accounting information. RCA will enter the information into the PPM Project Costs ADFDI template and upload into iO.

• Non labor cost transfers are to be requested by the Department Administrator and uploaded to BOX for processing.

Labor Cost Transfers for Costs Posted Beginning July 1

• Labor cost transfers will follow the general iO process for Labor Distribution changes. For changes to sponsored projects entered 90 days after the end date of the original labor distribution, the following is required:

  • The field “Includes sponsored projects over 90 days:” must be marked “Yes” on the Labor Distribution form.

  • A comment must be entered on the form explaining the reason for the cost transfers.

  • Include the Department Chair as an Optional Approver on the LD template so the required department chair approval is obtained.

  •  Labor cost transfers are to be requested by the Department Administrator and forwarded to Payroll for processing via Adobe Sign.

Other Cost Transfer Considerations

• For overspent projects, a Deficit project will be created by RCA to capture the excess costs. The Deficit project must be funded by the department via Balance Transfer.

Procedures Updated 10/29/2024

Effort Reporting Process

These procedures are issued in accordance with Research Policy 304, Effort Reporting.

Requirement

The Principal Investigator (PI) is responsible for the management of sponsored programs that are awarded to him/her. These include federal, state, and private grants and other sponsored agreements. The federal government requires the University to document effort charged and committed as cost sharing in accordance with provisions in the Uniform Guidance, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart E—Cost Principles §200.430 Compensation for personal services.

Background

Effort reporting is a means of verifying that the salaries charged properly represent the effort expended in support of a sponsored project or program, performed as specified in the award document.  The effort to be certified encompasses both salaries charged as well as time not paid by the project (mandatory or voluntary cost sharing). Rice has chosen to conduct this review and certification process twice yearly for faculty and employees and annually for graduate students. This process is known as Effort Reporting.

Training

Training is required for all first time PIs and all administrative staff who support PIs in the certification process. Training is strongly encouraged for all faculty. For instructions on how to take this training, please see the Effort Certification Training procedure. For staff training, please contact Research and Cost Accounting at rchacctg@rice.edu.

Confirmation and certification of effort

The PI should sign his or her own Effort Report and the reports of employees and students paid from or cost shared to his/her projects. Either the PI or Graduate Student’s Advisor should sign the Graduate Student Salary Confirmation. When this is not practical (e.g. a PI is no longer with the university), the individual who performs the work or someone who regularly oversees the work, such as the laboratory or project manager, may sign. Every signer must use a suitable means of verification to confirm that the work was performed. If someone other than those listed above signs the Effort Report or Salary Confirmation, written documentation of the method of verification used by the signer must accompany the Effort Report or Salary Confirmation. The department is responsible for determining the most appropriate person to sign the certification.

After the employee’s or student’s effort is certified on the Effort Report or Graduate Student Salary Confirmation, retroactive adjustments will not normally be permitted.

Labor redistributions

Labor redistributions (OLRs) on sponsored projects (R funds) are subject to Research Policy 302, Cost Transfers. When initiated, cost transfers must be timely, well­ documented and properly approved. Cost transfers submitted later than 90 days after the end of the month of the original transaction or later than 30 days after an award end will be reviewed on a case-by-case basis by Research and Cost Accounting (RCA).

Procedures

Effort Reports and Graduate Student Salary Confirmations are generated by RCA and sent out twice every year and annually, respectively, to departments (or organizations) in order to confirm that salaries and wages paid from or allocated to sponsored project funds (R funds) are reviewed by the PI. Departmental administrators or other employees designated by the chair are responsible for distributing the reports to the appropriate certifier.

If the certifier deems that the percentage of effort (work performed) charged to the various sponsored project funds is reasonable (within + 5 percentage points) for the reporting period, then the reviewer will sign and date the report to complete the certification.

If the printed percentage differs significantly from the employee’s actual effort, cross out the printed percentage and amount and write the correct percentage and amount to the right under ‘ACTUAL (3)’. Enter any additions in the space provided. This may require a modification to the salary charged.

To modify the salary charged, an Online Labor Redistribution (OLR) must be processed with the properly certified Effort Report. Note that the reviewer will require a cost transfer justification as part of the OLR comment.

Once certified, the approver will return the original document, along with any additional documentation or justification, to the departmental administrator or designee, who should retain a copy for departmental records. The departmental administrator or designee will forward the effort reports, along with any additional documentation, payroll redistributions, and / or justifications, to RCA.

Each report is printed with a due date. Reports are considered overdue if they are not properly completed, certified, and delivered to RCA by the due date. RCA will notify department chairs, deans and PIs about overdue Effort Reports within 20 days after the effort reporting deadline. Overdue reports not returned to RCA within 30 days after the effort reporting deadline will be considered delinquent.

As properly certified Effort Reports are returned to RCA, the analyst dates each report when it is received and reviews each report for the appropriate signature(s) and dates.  If payroll redistributions are required, RCA will monitor the process to ensure redistributions are processed as soon as possible.

Definitions

Certifier / approver: responsible individual who has first­hand knowledge of the work performed using a suitable means of verification, which can be obtained by documented discussion with the employee or PI.

Principal Investigator (PI): primary individual responsible for the technical and financial management of his/her research grant, cooperative agreement, training award, public service project, contract, or other sponsored project.

Total effort: defined as all professional activity for which the University employs an individual, whether on a full­ time or part-­time basis, including students who are working as teaching or research assistants. For reporting purposes, effort is calculated in percentages, not hours, with the total of all Rice effort equaling 100%. For faculty, total effort includes, but is not limited to, teaching, office hours, student advising, research activities, committee service, departmental meetings, professional development and community service at Rice or to Rice. Charges to sponsored agreements may include reasonable amounts for activities contributing and intimately related to work under the agreements, such as delivering special lectures about specific aspects of the ongoing activity, writing reports and articles, participating in appropriate seminars, consulting with colleagues and graduate students, and attending meetings and conferences. Specific short-­term assignments, such as teaching a continuing education course, that are not a routine part of an individual’s employment and are compensated separately, are not considered part of “total effort” and are excluded from the effort reporting requirement.

Effort Certification Training

The training is required for all administrative staff who support PIs in the certification process and for all first time PIs. Training requirement is mentioned in Effort Reporting Policy. For all other faculty, the training is strongly encouraged. It will take about an hour to go through it and the program allows completion in sections, not all at once. 

The content of the training module has been vetted with the Research Administration Advisory Group and with the Faculty Research Committee and updated by Research and Cost Accounting. 

Instructions for Login

If you have been invited to the Effort Certification Training:

1. Go to canvas.rice.edu
2. Select Rice Login
3. Enter your NetID and your NetID password.
4. Select Effort Certification.
5. Complete the required 7 modules and associated quizzes, achieving 1 point for each quiz. If you have not achieved the ­required score of 1 point for a quiz, you may retake it.

If you want to self-enroll to the Effort Certification Training:

1. Click on this link
2. Select Rice Login
3. Enter your NetID and your NetID password.
4. Click on Enroll in Course.
5. Click on Go to the Course
6. Complete the required 7 modules and associated quizzes, achieving 1 point for each quiz. If you have not achieved the ­required score of 1 point for a quiz, you may retake it.

Canvas mobile apps

Once you have enrolled to the Effort Certification Training, you can use Canvas Student Mobile app to access the training.

1. For Android device Download Canvas Android App   
2. For Apple device   Download Canvas Apple App
3. Open the Canvas Student App
4. Click on Find my school
5. Enter Rice University
6. Select Rice Login
7. Enter your NetID and your NetID password.
8. Select Effort Certification
9. Complete the required 7 modules and associated quizzes, achieving 1 point for each quiz. If you have not achieved the ­required score of 1 point for a quiz, you may retake it.

Program income

These procedures are issued in accordance with Policy 303, Program Income.

Background

Sponsors provide funding to cover the costs of conducting research, training, and public-service activities. Program income may be generated as a result of these activities and in some cases must be reported to the sponsor. Uniform Guidance and applicable federal agency regulations document the identification, recording, reporting, and monitoring requirements for income that is generated during the project period. To be consistent in its accounting practices, the University extends these requirements for managing program income to non-federal sponsors. 

Purpose of policy and procedures

Research Policy 303, Program Income, and these procedures are issued to comply with sponsor policies on program income and to ensure that such income is managed in an appropriate and consistent manner. 

Definition of program income

Program Income, per Uniform Guidance 200.80 , is "gross income earned by the non-Federal entity that is directly generated by a supported activity or earned as a result of the Federal award during the period of performance" and includes, but is not limited to: 

• Proceeds from the sale of software, CDs, tapes, or publications produced under the award.
• Income from fees for services performed, such as laboratory tests or analyses.
• Registration fees from conferences or symposia. 
• Payments received from external users of property or equipment acquired with sponsored project funds to the extent payments exceed total usage costs. 
• Proceeds from the sale of supplies or equipment purchased or fabricated under an award.
• Income resulting from license fees and royalties on patents and copyrights that is handled by the Office of Technology Transfer. (Note: Unless otherwise required by an award, program income resulting from license fees and royalties on patents and copyrights is not subject to these procedures.) 

Except as otherwise provided in the awarding agency regulations or the terms and conditions of the award, program income does not include: 

• Rebates, credits, discounts, etc., or interest earned on any of them.
• Interest earned on advances of federal funds. 

Recording and reporting program income

Program income will be deposited into a specific fund and account code established by Research and Cost Accounting (RCA), as described below. 

The program income fund will be established as a subfund of the primary sponsored project fund. F&A will be charged to expenses in the program income subfund at the same rate as the main sponsored project fund. 

Use of program income is limited to costs allowable on the main project. Therefore, expenses unallowable on the main project fund are also unallowable on the program income subfund. 

Unless otherwise provided in the award documents, program income revenue is used before sponsor funds. 

RCA is responsible for reporting program income activity to the sponsor. 

As with all records related to sponsored projects, records on program income activity must be retained according to sponsor requirements. 

• For federal awards, Uniform Guidance 200.333 requires that records be kept for at least three (3) years from the date of submission of the final expenditure report. 
• Some sponsors/awards may have a longer retention period. 

How program income can be used

Program Income earned during a project period will generally be treated using one of three methods, depending on sponsor policy, award type, and terms and conditions of the award. 

• Additive: Program income funds are added to the funds committed by the awarding agency, thus increasing the amount available to accomplish program objectives. Example:  A project has (1) $320,000 available ($300,000 award plus program income of $20,000) and (2) total expenditures of $315,000. Program income of $20,000 will be reported to the sponsor and considered fully spent; the sponsor will pay the balance of $295,000, leaving $5,000 of sponsor funds unused.   
• Deductive: Funds generated through program income are deducted from the financial obligation of the sponsor. Thus, total funding available for the project is unchanged. Example: A project has (1) $300,000 available (program income of $20,000 plus original award of $300,000, reduced to $280,000 due to the program income) and (2) total expenditures of $290,000. Program income of $20,000 will be reported to the sponsor and be considered fully spent; the sponsor will pay the balance of $270,000, leaving $10,000 of sponsor funds unused.   
• Matching: Program income is used to finance the University's share of the project costs. Example: A project has (1) $360,000 available (original award of $300,000 plus $60,000 of required cost sharing partially funded by program income of $20,000) and (2) total expenditures of $360,000. Program income of $20,000 will be reported to the sponsor and be considered fully spent; cost sharing from other sources will be reported at $40,000; the sponsor will pay the balance of $300,000, leaving no unspent balance in sponsor funding.

Federally-sponsored awards: Unless the federal awarding agency specifies in its regulations or the award terms and conditions a different method, Uniform Guidance provides that program income for research projects be treated under the additive method and program income on non-research projects be treated under the deductive method. 

Non-federally sponsored awards: Many non-federal sponsors do not have an established program income policy.  In the absence of a sponsor policy, the program income is not reportable to the sponsor. 

While all program income must be recorded properly in Banner, not all program income must be reported to the sponsor. The terms and conditions of the award determine the appropriate program income treatment and sponsor reporting requirements. For example, unless otherwise provided in the award, program income earned after the end of an award period is not subject to either the program income policy or these procedures. Additionally, as noted above, income resulting from license fees and royalties is subject to the program income policy and procedures only if the terms and conditions of the award require such reporting. 

Anticipated program income and the program income subfund

Principal Investigators (PIs) are responsible for identifying and documenting program income on projects funded by both federal and non-federal sponsors and notifying either the Office of Sponsored Research (SPARC) or Research and Cost Accounting (RCA), as described below. 

If program income is anticipated at the time of proposal submission, the PI notification must be included with the proposal documents sent to SPARC. 

• The Review and Approval (R&A) form question on anticipated revenues to be generated is marked "Yes," and the Notification of Anticipated Program Income form will be attached to the R&A and forwarded to SPARC. 
• The PI will ensure that potential program income information is appropriately included with the proposal documents sent to the sponsor. 
• If the proposal is awarded, SPARC will forward the program income information included in the proposal to RCA with other proposal documents forwarded for new awards. 

If program income is not anticipated at the time of proposal and arises out of opportunities that occur during the award, the PI is to notify RCA as soon as he/she becomes aware that program income will be generated for a specific award. 

• RCA can be contacted via email to rchacctg@rice.edu. 

RCA will establish the program income subfund and notify the PI, the appropriate department administrator, chair, and Dean's Office of the fund number. 

RCA will meet with the PI / department administrator to assist with estimating costs and rates and developing a plan for invoicing, payment collection, and deposit activities. 

Invoicing, depositing, monitoring, and reporting program income

The PI and department administrator (DA) are responsible for preparing any needed invoices related to the program income, collecting payments, and making cash deposits to the program income subfund. 

Program income should be deposited to account code 57231 (Program Income Non-Taxable) or 57241 (Program Income Subject to Sales Taxes).  Note: Questions on amounts subject to Texas sales taxes should be sent via email to disbmt@rice.edu to the attention of the Disbursements Manager. 

In order to establish the budget for the Program Income subfund, the PI and the DA are responsible for forwarding a Re-budgeting Request (with copies of the deposit vouchers, checks, and invoices) to RCA to record the expense budget for the income. 

The PI and DA are responsible for monitoring the budget and activity in the program income fund to ensure that all revenue and related expenses are properly reflected in Banner. 

RCA will report program income activity to the sponsor as required by sponsor regulations and award terms and conditions. 

During and after project closeout

During project closeout, RCA will report final program income amounts to the sponsor, as required by award terms and conditions. 

RCA will appropriately "zero" the program income fund based on project expenditures confirmed by the PI/DA. 

Program income earned after the project period of the primary award should not be deposited to the program income fund. 

• Contact Current Funds Accounting if a new non-R fund is needed after the project ends. 

Summary of roles and responsibilities

Function / Responsibility	PI / DA	SPARC	RCA
1. Notification of Anticipated Program Income Form (with estimated amounts, sources, etc.)
a. During proposal
1) Indicate "Yes" on R&A form & attach needed information	X
2) Ensure information is forwarded to sponsor as needed	X
3) Ensure information in the proposal is forwarded to RA if proposal is awarded		X
b. During award, via email to Research and Cost Accounting	X
2. Establishment of program income subfund			X
3. Invoicing, collection and deposit of payments to program income subfund	X
4. Processing needed budget revision forms	X		X
5. Reporting program income to the sponsor			X
6. "Zeroing" program income subfund during closeout of award	X		X

Record retention

These procedures are issued in accordance with Rice Policy No. 812. 

Purpose

Proper records management serves multiple purposes. It helps ensure that the University meets the requirements of sound business practices as well as compliance with sponsor and other legal and statutory standards for protection, storage and retrieval of information. Rice Policy No. 812, Records Management, sets forth the overall requirements for departments to manage, retain and dispose of records and includes information on the following topics:

• Departmental responsibility to develop a records management plan,
• Proper disposal methods,
• Records subject to a legal or regulatory claim, proceeding or audit, and
• Safeguarding confidential records.

Definitions

Banner is an Ellucian higher education software system used as the financial system of record for financial data, including the general ledger and primary subsidiary ledger transactions of the University.

Cayuse is an electronic research administration software from Evisions used for proposals and awards. Cayuse data interfaces with Banner. Cayuse documents are uploaded to OnBase.

Concur is an on-line software system for recording and documenting PCard purchases and all travel, entertainment and business meeting expenditures. The expenditure transactions interface with Banner.

Financial records are all proposal and award documents plus all documents supporting financial transactions and reports. Examples of financial records include: original and supplemental proposals; original awards and amendments; budgets; encumbrances; direct cost expenditures; fringe benefit rate agreements; indirect  cost rate agreements; requests for payments and payments received; financial reports. Uniform Guidance states: “when original records are electronic and cannot be altered, there is no need to create and retain paper copies. When original records are paper, electronic versions may be substituted through the use of duplication or other forms of electronic media provided that they are subject to periodic quality control reviews, provide reasonable safeguards against alteration, and remain readable.”

OMB Uniform Guidance include administrative requirements, cost principles and audit requirements for federal awards (which includes research grant awards).

OnBase is a document imaging system from Hyland Software and is used as the system of document record retention by various university offices, including the Controller’s Office and the Office of Sponsored Projects (OSP).

Sponsored projects are externally-funded activities in which a formal document or agreement (example: a grant, contract, letter award or a cooperative agreement) is provided to Rice University by a sponsor or a written agreement (contract or subaward) is entered into by Rice University and a sponsor. A sponsored project may be thought of as a transaction in which there is a specified statement of work with a related, reciprocal transfer of something of value. In addition, when the terms and conditions of a gift or contribution provided to Rice University require that the funding be considered a sponsored project, the award will be assigned and maintained through a sponsored project fund (R fund).

Retention period for all financial records of sponsored projects is a minimum of four (4) years beyond the project end date. If a sponsor’s record retention period is greater than four (4) years or more after the project end date, the period specified in the award agreement is to be followed. 

Rice Marketplace is a procurement software system from SciQuest used for the system of document records for encumbrances/purchase orders. It interfaces with Banner.

WebApps is a Rice-developed web application system that provides on-line, real-time Banner data to principal investigators (PIs), department administrators and central offices.

Responsibility

Records management of sponsored projects is a shared responsibility among many offices, departments and individuals. The underlying principle of this shared responsibility is that the area with the original record is responsible for the management, retention and disposal of the records. This responsibility includes establishing and maintaining procedures for the protection of essential records in the event of a natural disaster or other emergency.

These retention guidelines do not require the retention of the original paper document(s); an electronic copy is sufficient as long as it is legible and contains the same data.  See the definitions section below for additional federal guidance on electronic records. 

Records must be retained in accordance with Rice policy and sponsor requirements. To ensure compliance with sponsor and other regulatory record retention requirements, financial records for individual sponsored projects are to be retained for a minimum of four (4) years after the project end date. This period meets the record retention requirements of all federal agencies and many other sponsors. (Example: An expense is charged in May 2011 during the first year of a three-year federal project; the project is later granted a no-cost extension until 10/31/14.  The expense records for the May 2011 transaction must be kept through 10/31/18, which is four years after the revised project end date of 10/31/14.)

If a sponsor’s record retention period is greater than four (4) years after the project end date, the period specified in the award agreement is to be followed.  For instance, the Cancer Prevention & Research Institute of Texas requires that records “be kept for four (4) years after the final reimbursement for the award has been paid and until any (if applicable) litigation, claims or audit findings have been resolved.”

As stated in Rice Policy No. 812, if a record is relevant to a pending or anticipated claim, investigation, audit, agency charge, enforcement action or litigation, the records must be retained until the final resolution of the matter.  If there is any question whether a department or office's normal document destruction schedule should be temporarily suspended because of a pending matter, the department or office shall consult with the Office of the General Counsel before any such destruction. 

Responsibility matrix for financial records

In the event an area retains the original of a type of financial record not listed below, the record is to be maintained in accordance with these guidelines.

Financial record type	Responsible area	Examples	Comments	Additional comments
A. Proposals
A.1	Proposal documents	Office of Sponsored Projects (OSP)	Internal processing form; technical (statement of work, c.v., etc.); financial (budget,  budget narrative, cost sharing); subaward proposal documents; other documents as needed	Processed through Cayuse. An electronic record is maintained in Cayuse as well as uploaded to OnBase.
B. Awards (including amendments)
B.1	Awards to Rice	OSP	Fully executed  award agreement, with all exhibits and attachments	An electronic record is maintained in Cayuse as well as uploaded to OnBase.
B.2	Subawards from Rice	OSP	Fully executed  subaward agreement, with all exhibits and attachments	An electronic record is maintained in Cayuse as well as uploaded to OnBase.
B.3	Fund setup	Research and Cost Accounting (RCA)	Coding sheets and budget actions
C. Direct cost expenditures
C.1	Payroll records	Controller’s Office	Approved personnel action forms (PAFs); timesheets; labor redistributions (OLRs)
C.2	Effort reports	RCA	Faculty and staff semi-annual effort reports; graduate student annual salary confirmations
C.3	Purchase orders (POs)	Procurement	PO copies; requisitions; quotes; bids; approvals; internal forms	Processed through Rice Marketplace.
C.4	Subcontract invoices	Controller’s Office	Invoice copies; approvals; coding
C.5	Other vendor invoices	Controller’s Office	Invoice copies; approvals, including receipt; coding
C.6	Check requests; expense reimbursements	Controller’s Office	Approvals; coding; supporting documents
C.7	PCard charges (general purchases plus travel, entertainment and business meetings)	Controller’s Office	Supporting documents; expense statements; approvals; coding	Controller’s Office is responsible for PCard, travel, entertainment and business meeting records processed through Concur.
C.8	PCard charges (general purchases plus travel, entertainment and business meetings)	Departments	Supporting documents; expense statements; approvals; coding	Departments are responsible for PCard and travel envelope records processed prior to implementation of Concur.
C.9	Petty cash vouchers	Controller’s Office	Approved and coded petty cash vouchers; supporting receipts and documents
C.10	Journal vouchers	Controller’s Office	Cost transfer (EX) forms; Interdepartmental (IDT) forms;
C.11	Tuition / scholarship charges	Graduate and Postdoctoral Studies (graduate students)	Eligibility; approvals
		Student Financial Services (undergraduates)	Eligibility; approvals
C.12	Student loans	Student Financial Services	Eligibility; signed loan agreements
C.13	Service center charges	Service Centers	Usage; approvals; support for rate development
D. Financial reporting and closeout
D.1	Sponsor payments	RCA	Invoices/cash requests to sponsors; reconciliation to Banner; payments received; collection activity
D.2	Financial reports	RCA	Reports submitted; reconciliation to Banner
D.3	Financial closeout reports	RCA	Reports submitted; reconciliation to Banner; recaps; confirmations from departments; final financial closeout checklist and support
D.4	Property reports	Property Accounting	Reports submitted; reconciliation to Banner
E. Other financial records
E.1	Fringe benefit proposals	RCA	Rate agreements; computations, including reconciliation to Banner	Retain for three (3) years from date of submission, per OMB Uniform Guidance.
E.2	Facilities and Administrative (F&A) cost proposals	RCA	Rate agreements; computations, including reconciliation to Banner	Retain for three (3) years from date of submission, per OMB Uniform Guidance.

Management information

When a central office has retention responsibility, the department initiating a transaction may discard copies of documentation supporting the transaction when it is no longer needed for management purposes.  A department may keep copies of documents for longer periods.

Salary support

These procedures are issued in accordance with Research Policy 311, Salary Support through Sponsored Projects. Rice is required to electronically verify work authorization for all employees (including students) and visiting faculty paid from or cost-shared on a Federal contract that includes the E-Verify clause. Please see the SPARC website for additional information. 

Actions related to faculty compensation

Summer salary

1. Faculty Summer Salary Authorization (FSSA) completed in Adobe Sign and routed for faculty member, Principal Investigator (PI) (if different), and Dean’s signatures in the workflow. Chair signature may be required by some departments and schools.
   • Follow Faculty Summer Salary Guidelines posted on the Payroll Forms section of the Controller’s website. 
   • Provost's approval required for any policy exceptions. 
2. RCA reviews and approves.  RCA reviews for available budget or guarantee fund, charges within project period, allowability, correct coding (i.e. Fund, Org, Account, Program, Activity and Location or FOAPAL), and other sponsor limitations (i.e., NIH variable annual salary cap, NSF limitation of no more than 2/9ths of regular annual academic salary for all NSF-funded awards). 
3. Payroll processes the FSSA form. 
4. Departmental administration reviews completed payroll transactions. Changes in distribution or additional amounts must be reflected on new FSSA. 

Academic Year Time Salary

The Academic Year Time Faculty form is to be used for tenure track faculty only.  The faculty who fall under this category includes Professor (60110), Associate Professor (60120) and Assistant Professor (60130).

1. Fall or Spring Academic Year Time (AYT) form:
   1. Fall or Spring Academic Year Time (AYT) form (found on Payroll Forms Website).
   2. Separate Fall or Spring AYT excel form completed and then attached into the Faculty AYT form in Adobe Sign. Signatures for faculty member, PI (if different), Chair, and Dean are required in the workflow. Provost's approval required for direct or contributed effort above 50% of the academic year or any other policy exceptions.  
   3. RCA reviews and approves AYT form in the workflow. RCA reviews for available budget or guarantee fund, charges within project period, allowability, correct FOAPAL coding, and other sponsor limitations (i.e., NIH variable annual salary cap, NSF limitation of no more than 2/9ths of regular annual academic salary for all NSF-funded awards). 
   4. Payroll processes AYT form.  
   5. Individuals in the workflow (including the Budget Office) receive final form. 
   6. Departmental administration reviews completed payroll transactions. Changes in salary distribution or additional amounts must be reflected on new AYT form.
2. Budget Transfer Memorandum (BTM):
   1. BTM completed and routed for faculty member, Chair, and Dean’s signatures based on school procedures for allocation of released salary and benefits paid from A1. 
   2. BTM routed to the Budget Office. 
   3. The Budget Office forwards BTM to RCA. RCA reviews for Fall or Spring AYT form or other payroll form completed and budget transfer request amount equals charges to sponsored project funds. 
   4. RCA forwards to Current Funds for processing. 
   5. Departmental administration reviews completed budget transactions. 

Notes:

• For awards expected, but not yet received by the university, please see advance spending fund procedures. 
• ‘To be determined’ (TBD) or an advance spending fund should be used on effort reports or salary form. ‘TBD’ will be charged to the department’s A1 fund.

Actions related to exempt staff

New hires:

1. Personnel Action Form (PAF) completed in Adobe Sign by department and routed for required signature in the workflow. PAF must include default fund-org-acct.
2. Approved PAF routed to Human Resources (HR) in Adobe Sign. HR reviews, codes, makes changes in Banner if needed, and uploads PAF to OnBase.
3. Payroll Processes PAF.
4. Individual appears on Time Allocation Report (TAR).

All exempt staff:

1. Monthly TAR emailed to department by Payroll. 
2. Department reviews TARs.
3. If there are changes, department processes EPAF for future pay periods or OLRs for previous pay periods. 
4. RCA reviews and approves EPAF / OLRs for direct and cost shared allocations for charges within project period, allowability (limited to administrative / clerical staff allowability), and correct FOAPAL coding. 
5. Payroll reviews and processes EPAF / OLRs. 
6. Departmental administration reviews completed payroll transactions. 

Actions related to non-exempt staff

New hires:

1. Personnel Action Form (PAF) completed in Adobe Sign by department and routed for required signature in the workflow. PAF must include default fund-org-acct.
2. Approved PAF routed to Human Resources (HR) in Adobe Sign. HR reviews, codes, makes changes in Banner if needed, and uploads PAF to OnBase.
3. Payroll Processes PAF.

All non-exempt staff:

1. Timesheets, including fund-org and hours worked, completed by individual. 
2. Timesheets verified and signed by the supervisor(s) / manager(s). 
3. Departmental administration reviews completed payroll transactions. 

Notes:

• Hours reported via timesheets will be charged to default fund-orgn-acct provided from EPAF. If actual hours differs from default, turn in revised timesheets to update hours worked. OLR must be completed by department to correct posted salary.
• Future changes to the default fund-orgn-acct should be updated via EPAF. 

Actions related to undergraduate students (hourly students on RCH, OSP2, INST, or RCHU funds)

New hires:

1. Student Personnel Action Form (SPAF) initiated by the student in ESTHER is completed by the department and routed for required signatures. 
2. Approved SPAF sent to Financial Aid. 

All hourly students:

1. Timesheets, including fund-orgn and hours worked, completed by individual. 
2. Timesheets verified and signed by the supervisor(s) / manager(s). 
3. Departmental administration reviews completed payroll transactions. 

Notes:

• Hours reported via timesheets will be charged to default fund-orgn-acct provided from SPAF. If effort differs from default, turn in revised timesheets to update hours worked. OLR must be completed by department to correct posted salary.
• Future changes to the default fund-orgn-acct should be updated via SPAF. 

Actions related to graduate students

1. Via WebApps, Graduate Student Payroll Authorization (GPAF) completed by student's home department. 
2. Office of Graduate & Postdoctoral Studies (GPS) reviews and approves GPAF.
3. RCA reviews and approves GPAF. RCA reviews for charges within project period, allowability, and correct FOAPAL coding. 
4. Payroll reviews and approves GPAF. 
5. Departmental administration reviews completed payroll transactions. If there are changes, department processes GPAF for future pay periods or additional amounts, or OLRs for previous pay periods.

Note: GPAF required for payroll actions, including new students and terminations. 

For cost transfers over 90 days old or otherwise subject to the Cost Transfer Policy and Procedures:

1. Online Labor Redistribution (OLR) completed by department and approved by Chair. 
2. Cost Transfer Policy and Procedures followed by the department, including explanation of benefit to the award(s) by the individual, explanation of delinquency, and steps the department is taking to avoid future late occurrences. 
3. RCA reviews and approves OLR. RCA reviews for direct and cost shared allocations: within project period, allowability (limited to administrative / clerical staff allowability), and correct FOAPAL coding. 
4. Payroll processes the OLR. 
5. Departmental administration reviews completed payroll transactions. 

Questions

For questions about approved forms sent to Payroll for processing, please contact payroll@rice.edu. For questions about allowability, sponsor limits and budgetary restrictions, and FOAPAL coding, please contact rchacctg@rice.edu.

For questions about Rice budget transfers, please contact budget@rice.edu.

Page revised 8-6-2020

 

Tuition remission

These procedures are issued in accordance with Research Policy 305, Tuition Remission. 

Rice University charges tuition remission on amounts paid to graduate students who provide services to the university as research assistants (RAs) or teaching assistants (TAs) as part of their enrollment at the University. Research Policy 305 applies regardless of the funding source. The charge for tuition remission is based on an average rate applied to all compensation paid to graduate RAs and TAs. The tuition remission rate is set annually and may change at the beginning of each fiscal year. The current tuition remission rate is posted on the Office of Sponsored Projects and Research Compliance (SPARC). 

Coding graduate student stipend payments

Proper coding of graduate student stipend payments is based on whether the graduate student is appointed as a trainee/fellow or as a graduate RA or TA, depending on his or her assignments. Separate account codes are used on the Graduate Student Payroll Authorization form for these types of stipend payments: account code 60820 for trainee/fellow; 60850 for RA; and 60860 for TA. (Note: Graduate students who are paid hourly wages are classified as graduate student workers and payments are charged to account code 60880 on the Student Payroll Authorization form available through Esther.) 

Guidelines for coding of graduate student stipend payments are available on the Office of Graduate and Postdoctoral Studies website. 

Tuition remission charges: The payroll system will automatically post a tuition remission charge to the same fund and organization as the payment recorded for an RA or TA. Tuition remission costs that are not eligible expenses on sponsored funding are charged, without penalty, to the department’s A1 budget (unrestricted funds). 

Tuition remission and the annual budget: The University has chosen to provide to the Deans, through the annual operating budget process, an allocation equal to a portion of the tuition remission generated -- from sponsored project, designated, gift and restricted endowment funds -- in the just completed fiscal year. 

Effective fiscal year 2009, Rice includes in the year-end budget carry forward calculation an amount equal to 100% of the amount charged as tuition remission on compensation paid to graduate students from departmental unrestricted (A1 and A2 budget) funds. This amount excludes tuition remission charges that defaulted to unrestricted funds because tuition remission was not an eligible expense of the external funding source. 

Questions 

The following offices are available for assistance: 

Correct coding of graduate student stipends. Contact the Office of Graduate and Postdoctoral Studies (graduate@rice.edu) or Research and Cost Accounting (email rchacctg@rice.edu). 

Posted tuition remission charges.  Contact the Payroll Office (payroll@rice.edu).

Other Policies and Procedures

Rice Purchasing and Payment Manual (PDF):

• In assuming the stewardship of federal funds for sponsored programs, Rice has adopted certain cost guidelines and regulations that apply to federal awards, and also establish the principles for overall university costs. These principles include consistent treatment of like expenditures as direct or indirect costs, and require that procedures be in place to ensure compliance. Further information is contained in Section 11 of the Manual.

Rice University Disclosure Statement (DS-2):

• Articulates what cost-types are typically charged to sponsored agreements and what cost-types are included in Rice University’s rates ( F&A rates, fringe benefit rates, etc.).

Federal-wide research Terms and Conditions.

• Uniform Guidance states when prior approval is required for specific cost categories. Some agencies have waived this requirement. Please refer to federal-wide research terms and conditions for guidance on specific agency waivers of these prior approval requirements.

Direct cost application to Federal awards: 

• Identification with the Federal award, rather than the nature of the goods and services involved, is the determining factor in distinguishing direct from indirect (F&A) costs of Federal awards (2 CFR 200.413(b)). Typical costs charged directly to a Federal award are the compensation of employees who work on that award, their related fringe benefit costs, and the costs of materials and other items of expense incurred for the Federal award. If directly related to a specific award, certain costs that otherwise would be treated as indirect (F&A) costs may also include extraordinary utility consumption, the cost of materials supplied from stock, or services rendered by service centers, or other institutional service operations. 

Non-Federal subcontractor indirect (F&A) costs: 

• Any non-Federal entity that has never received a negotiated indirect cost rate, except for those non-Federal entities described in the Uniform Guidance Appendix VII to Part 200—States and Local Government and Indian Tribe Indirect Cost Proposals, paragraph D.1.b, may elect to charge a de minimis rate of 10% of modified total direct costs (MTDC), or negotiate with Rice University directly for a different rate (2 CFR 200.414(f)).

Examples of acceptable direct charging practices:

• A technician performs duties which benefit two projects equally. The technician’s salary is charged equally to each project during the period the work was performed.
• Reagents are needed to process samples for two different projects. Project A has four (4) times as many samples to be processed as Project B. Eighty percent (80%) of the cost of the reagents is charged to Project A and twenty percent (20%) of the cost is charged to Project B.
• Project A and Project B are closely related. Two substrates are needed for each project in approximately equal amounts and the cost of the substrates are approximately equal. One substrate is charged to Project A and one substrate to Project B.

Examples of unacceptable direct charging practices:

• Purchasing items only to spend out remaining funds
• Rotating charges among projects without establishing that the rotation schedule accurately reflects the relative benefit to each project during the specified period of time.
• Charging an expense exclusively to an award when the expense has supported more than one award.
• Assigning charges to a project on the basis of the remaining balance to resolve funding problems.
• Charging the budgeted amount in contrast to charging an amount based upon actual benefit or use.
• Assigning charges to an award before the cost is incurred.
• Assigning charges that are part of the normal administrative support for awards (e.g. proposal preparation, accounting, payroll, routine preparation of purchase orders and vouchers).
• Applying a "departmental tax" to projects for clerical, secretarial, and administrative costs.
• Charging costs incurred for multiple projects or functions to several sponsored projects when benefit of the cost to each sponsored project cannot be determined with relative ease and certainty.