Managing Your Grant
Congratulations on being awarded a grant from an external funder! The grant that you have received is a testament to your hard work, fine scholarship and innovative ideas. We are proud of you and are pleased to have the opportunity to help you with the (sometimes messy) process of managing an external grant.
There are three main players in the administration of a grant:
- The Principal Investigator (PI) or Project Director (PD)
- The Grants Accountant (Lori Peck, Assistant Controller, x6161)
- The Director of Faculty Research Support (Tess Powers, x6318)
Sometimes the faculty PI receives assistance in tracking the grant expenditures from his or her department’s staff person. In these cases, the staff person is a critical fourth player in the process of managing the grant well.
Now that the grant has been formally awarded, it’s important that these individuals sit down together in a “post-award meeting” to:
- Confirm the fund number established for the grant
- Ensure everyone has a copy of the proposal documents, particularly the budget and budget justification
- Confirm the grant award period
- Discuss roles and responsibilities in the management of the grant
- Review how expenditures can be monitored in GoWest
- Discuss compliance issues as applicable, and
- Discuss various post-award procedures, including:
- Grant Purchasing Overview (including Cost Transfers, or Journal Entries)
- Changes After the Award (including Rebudgeting and The Prior Approval Process)
- Monitoring Budgets, and
- Grant Close-Out Procedures
According to OMB Circular A-21, which outlines cost principles for costs applicable to grants to educational institutions, all costs charged to a federal grant must be:
- reasonable - recognized as necessary to perform the project, related to an action deemed within the norms of business conduct and not exceeding an amount deemed to be within those norms (i.e., the “prudent person test”)
- allocable to the specific project - incurred solely to advance the work funded by the grant (or allocable to more than one grant or college activity in proportions that can be approximated using “reasonable” methods)
- consistent with the way the same costs are treated in similar circumstances at Colorado College
- allowable under federal cost principles, agency-specific policies, award-specific terms and conditions, and college policies (It must not be designated as “unallowable” under Section J of OMB Circular A-21; see a summary of Section J). Generally, if the cost was included in the awarded budget, it is allowable. Routine office expenses (supplies, postage, telephone, photocopies, etc.) may not be charged to grants unless they are specifically included in the awarded budget.
While the above rules apply to all federal grants, they also apply to most others as well.
Grant purchasing follows the same Procurement Policy and Procedures used for any other College purchases. Examples include purchase requisitions, charges for College services (bookstore, reprographics, etc.), charges for meals, and travel reimbursement.
P-card purchases must follow the same rules and policies as any other grant purchase. If you use a P-card, you or your department must keep all the original receipts available in case the Business Office needs them for an audit. Be sure to include the grant fund number on all paperwork.
Cost transfers are more commonly known as journal entries. They represent the act of transferring expenses from one account to another. Cost transfers can include payroll or non-payroll expenses.
At the federal level, cost transfers are extremely sensitive. OMB Circular A-21 states that costs “may not be shifted to other sponsored agreements in order to meet deficiencies caused by cost overruns or other fund considerations, to avoid restrictions imposed by law or by terms of the sponsored agreement, or for other reasons of convenience.”
When auditors review transactions under sponsored research accounts, they will closely review cost transfers for proper documentation, timeliness, and allowability. Any deficiencies in these areas may result in a denial of payment or a need to return funds to the sponsor.
If you need to request a cost transfer (journal entry) for your grant, please
- contact the grants accountant for approval
- submit the cost transfer request within 90 days of the original charge in order to be considered timely. (Inappropriate expenses to a grant can be removed at any time.)
- include a detailed explanation of why the transfer is taking place
- include documentation of the specific costs being transferred. (This includes the date of the original charge, copies of invoices or accounts payable vouchers. The grants accountant needs to ensure that actual, identifiable expenditures are being transferred, not just lump-sum amounts.)
And remember: Expenditures being transferred to a sponsored program account must be directly accountable to the research being performed and must have occurred within the grant period.
Remaining balances on sponsored research projects may not be transferred to any other account. Federal regulations require remaining balances to be returned to the funding agency when the grant ends.
While we do our best to anticipate the future in grant proposals, sometimes in the course of executing a grant, it becomes clear that changes are necessary. These can include changes in:
- the scope of work
- the role of the PI (or an addition of a Co-PI)
- the length of the grant period
- methods or procedures (significant in nature)
Other budget-related changes may also be necessary, such as:
- the addition of a subaward
- pre-award costs in excess of 90 days
- reallocation of money among budget line items (“rebudgeting”)
- rebudgeting of participant support costs
Depending on the funder and the nature of the change, these changes may require internal or external approval. (It is important to note that, in either case, a written request must be reviewed and approved.) Please discuss whether internal or external approval is needed with the Director of Faculty Research Support as soon as you determine that such changes would benefit the project.
The budget is the financial expression of the project or program as approved during the award process. Once a grant has been awarded, the PI is expected to follow the approved budget in overseeing the spending of the grant.
However, after a grant has been awarded, the PI may determine that the approved budget allocations are not consistent with actual project needs. She or he may request a reallocation of funds from one spending category, or account code, to another account code category that better reflects the project requirements. This process is called rebudgeting or budget revision.
Many federal agencies have transferred the authority to approve such changes to awardee institutions. Colorado College’s implementation of these authorities is described in the Prior Approval Process below.
Funding agencies have delegated increasingly expanded authority to institutions to approve certain administrative actions. These agencies require grantees to assure that adequate institutional reviews and approvals are in place for decisions that affect the management of federally supported projects. All approvals must be documented. To provide these assurances, Colorado College has established the following Prior Approval Process.
The Controller’s Office administers all external funding that comes to Colorado College according to OMB Circular A-21, applicable federal regulations, Colorado College policies, and the sponsor's particular grant provisions and conditions. Authorized Institutional Officials include the Vice President for Finance and Administration, the Controller, and the Dean, who are authorized to sign all research grant applications on behalf of the college. The Grants Accountant has day-to-day responsibilities for accounting related to sponsored activities.
Principal Investigators or Project Directors are authorized to make charges to their grant that agree with the approved budget. Before incurring any charges that deviate from the awarded budget, the PI must consult the Director of Faculty Research Support.
To request administrative changes (such as those listed here), the PI should submit a Prior Approval Form to the Director of Faculty Research Support, who will review it with the Grants Accountant and obtain any additional required signatures.
If the granting agency has authorized the College to approve such changes, Director of Faculty Research Support will recommend approval of the request if the following four conditions are met. The changes are:
- are allowable under Circular A-21,
- are consistent with the terms and conditions of the award and with sponsor and Colorado College policies,
- do not constitute a change in project scope,
- are reasonable, necessary and allocable to the project.
If the College does not have the authority to approve the request, the Director of Faculty Research Support will forward the request to the funding agency.
The signed Prior Approval Form is retained in the grant file for three years following submission of the final financial report.
The PI or PD is responsible for monitoring all expenses charged to the grant. The Grants Accountant recommends that you review your grant budget at least once a month in GoWest in order to avoid cost overruns and identify any misallocations. Mistakes can happen, but expenses posted to a grant in error can be moved easily if the error is caught within a short period. During your monthly review, be sure that all invoices, vouchers, and payroll charges that have been submitted are charged to the grant properly. Grant budget overruns will be charged to the PI's research account.
Please contact the Grants Accountant for help with logging into -- and reviewing information in -- GoWest.
We aim to close out a grant within three months of the grant’s expiration date.
A grant is considered closed once all of the requirements for final reporting and all deliverables have been fulfilled and accepted by the sponsor. This includes, but is not necessarily limited to, the final technical report from the PI and the final financial report from the Business Office.
To close out the technical side of a sponsored project, the PI must send the sponsor the final technical report, with a digital copy to the Director of Faculty Research Support so that it can be added to the paper and digital files.
To close out the financial side of a sponsored project, the Grants Accountant will review the fund for any errors. If any unallowable expenses are discovered during this process, the charges must be transferred to an appropriate fund. Cost Sharing and Effort Reports will be verified and any deficits will need to be cleared. Additionally, any open encumbrances must be closed.
After all internal and external requirements have been met, the Grants Accountant:
- Prints the final financial data from Banner.
- Closes the fund number.
- Receives any remaining documentation from the Director of Faculty Research Support.
- Marks the paper file as closed and stores it with closed files to be retained for at least three years from the date of the final financial report.
- Reviews, with the Director of Faculty Research Support, the electronic file to ensure all electronic retention of all documents.
- Ensures that the grant closure date is marked on digital folders and internal tracking documents.
The Director of Faculty Research Support will send confirmation to the PI when a grant has been closed.
Many thanks to Middlebury College, Smith College and Wesleyan College for substantial use of their post-award procedures language.