1301 PR.06 Sponsored Projects Financial Reporting and Closeout

Contents

1.     Overview

2.     Procedure Applicability

3.     Identifying Sponsor Required Financial Report Due Dates

4.     Adjustment Period Activities

5.     Sponsored Projects Financial Administration (“SPFA”) Responsibilities

6.     Revising Submitted Final Financial Reports (“FFRs”)

7.     Award Designations: “On Hold” vs. “Closed”

8.     Record Retention

As a recipient of federal and non-federal sponsored projects funds, Yale is obligated to comply with a sponsor’s award terms and conditions.  Typically, sponsored award agreements include financial reporting requirements.  Federal regulations (2 CFR § 200) for example, state the following requirement:

“If the non-Federal entity does not submit all reports in accordance with this section within one year of the period of performance end date, the Federal awarding agency must report the non-Federal entity’s material failure to comply with the terms and conditions of the award with the OMB-designated integrity and performance system (currently FAPIIS).  Federal awarding agencies may also pursue other enforcement actions per § 200.339.”

This procedure assists in ensuring Yale’s compliance with sponsor requirements to submit timely and accurate financial reports.  Whether the submission of a financial report is in the form of an invoice, final financial report (“FFR”), or other sponsor specified financial report (herein collectively referred to as “financial report”), it is the responsibility of the University to comply with sponsor requirements.  This responsibility relies on the collaboration and cooperation of Sponsored Projects Financial Administration (“SPFA”), the Principal Investigator (“PI”), and the PI’s department business office and/or business support unit (herein collectively referred to as “DBO”), as appropriate.

This procedure applies to all schools and departments responsible for the administration of sponsored awards, both federally and non-federally funded.

On a regular basis, preferably monthly (if not more frequently) and in accordance with Form 1101 FR.01 Financial Review Checklist, departments are expected to run the Sponsored Report Tracking (Award Tasks) – Yale report to identify awards that are ending and/or have a financial report coming due.  This report indicates the sponsor’s financial report due date, as well as the date the draft financial status report (“FSR”) is due to SPFA (the Institutional Due Date or IDD).

For any award with a financial report coming due, it is the responsibility of the DBO to run the draft financial status report (Sponsored Financial Status Report – Yale), review the information for accuracy, obtain the appropriate signature, and submit the draft financial report to SPFA with any supporting documentation, as appropriate (e.g., Subaward Reconciliation Form, Training Grant Encumbrance Form, etc.).

The adjustment period is the time between the award installment end date or the award expiration date and the date the certified FSR is due to SPFA.  The activities performed during the adjustment period are critical to the overall financial reporting process and include:

1. Verifying the allowability of expenses; and
2. Ensuring the timely submission of all financial reports to the sponsor. 

SPFA has established an adjustment period schedule during which the PI and his/her DBO are responsible for verifying the allowability and benefit of expenses to the sponsored award.  Specifically, the PI and the DBO are responsible for completing the following tasks:

• Review and verify expenditures in accordance with University policies/procedures and sponsor terms and conditions; 
• Execute all necessary expense adjustments in accordance with University policies/procedures and sponsor requirements; and
• Certify and submit the draft FSR to SPFA on or prior to the deadline date as specified in the table below.

Note: Failure on the part of the PI/DBO to submit a timely draft financial report to SPFA will result in SPFA’s submission of the financial report based on the general ledger activity at the close of an interim and/or final budget period of the award.

Once SPFA receives the certified draft FSR, SPFA performs financial review activities, which may include the following functions, prior to Yale’s official submission to the sponsor:

• Perform an overview of award costs in accordance with applicable regulations, specific terms and conditions, and Yale’s policies and procedures;
• Reconcile F&A;
• Reconcile cash;
• Upon request of the PI and/or DBO, assist in the receipt of the final subaward invoice;
• Prepare the financial report according to sponsor requirements; and
• Certify and submit the financial report to the sponsor.

In general, unliquidated obligations or commitments are not permitted unless otherwise approved or requested by the sponsor.  For example, the National Institutes of Health’s Grant Policy Statement states, “Final financial reports must indicate the exact balance of unobligated funds and may not reflect any unliquidated obligations.”

If adjustments to the University’s financial statements are required to accurately reflect award expenses, the DBO must process all adjustments before submitting the draft financial reports to SPFA or notify the SPFA Accountant prior to submission of any unusual situations.  Expense adjustments posted after the draft financial report is submitted to SPFA will not be included in the financial report to the sponsor and will be transferred by SPFA to the department’s Suspense Project.

Note: DBOs of the award owning cost center must remove any cost overruns or overdrafts.  If overdrafts are not removed from the sponsored award prior to submitting the FSR to SPFA, SPFA will transfer the overdraft to the department’s Suspense Project.

The requirements regarding the submission of a revised financial report are dictated by the sponsor’s terms and conditions.  In general, a revised financial report is required in cases where a credit to expense occurs, resulting in a balance available on the award (downward adjustment to the award), regardless of the timeframe.

A revised financial report may also be submitted to claim remaining funds due to an unexpected allowable expense (upward adjustment to the award).  In these instances, SPFA reviews each situation on a case-by-case basis to determine the appropriateness of the expense and whether or not Yale should submit a revised financial report.  Requests to submit an upwardly revised financial report must be approved by the PI and DBO before sending the revised draft FSR to SPFA for review and final determination on a refile request.

Once the draft FSR is received, SPFA changes the award status in Workday from “Active” to “On Hold.”  After the financial report is submitted to the sponsor, SPFA proceeds with closeout activities and subsequently changes the award status in Workday from “On Hold” to “Closed.”

Records created and/or utilized for the submission of required financial reports and award closeout activities are expected to be retained in the DBO’s sponsored award file.  The DBO must adhere to the requirements set forth in the University’s Record Retention Schedule and sponsor terms and conditions.