Share This Page
Fixed Price Agreements - Residual Balance
FSS/PPS No. 03.04.06
Issue No. 1
Reviewer: Director of Grants and Contracts Administration
Effective Date: 06/20/05 (E4Y)
Review Date: 06/09
01. POLICY STATEMENTS
| 01.01 | The purpose of this PPS is to establish the policies and procedures under which Grants & Contracts Administration (GCA) will close out accounts which were established for fixed-price agreements with external funding sources. |
| 01.02 | All costs related to a fixed-price agreement must be charged to the account at the time the cost is incurred; thus residual balances should be relatively small. Excessive balances would indicate that the account should be reviewed carefully, to identify the source of the balance. GCA is responsible for notifying the Associate Vice President for Financial Services/Treasurer (AVPFS/T) of excessive balances in fixed-price agreements. It may also be necessary to notify the Director of Internal Audit of such situations because it could be an indication that the account manager has utilized other university funds to support the project so as to generate a residual balance at the end of the project. |
| 01.03 | In the event that an account for a fixed-price agreement has a negative balance at the time of close-out, GCA will contact the principal investigator to identify an institutional (none-E&G) account to which the excess cost can be charged. |
02. DEFINITIONS
| 02.01 | Fixed price agreements are agreements in which the university agrees to perform specified services for a pre-determined, fixed amount of money. The Fixed Price contract is expected to be based on the best estimate of the funds needed to complete a project. In some cases, a small residual balance (excess of revenue over expense) may remain at the end of the project. |
| 02.02 | Termination date is the end date of the fixed-price agreement (including any modifications and/or extensions). |
03. PROCEDURES
| 03.01 | GCA has responsibility for closing fixed-price accounts not later than six months after the termination date. | ||
| 03.02 | At the time the account is being closed, the university will recognize all remaining un-realized indirect cost (F&A) associated with the agreement. Full federal indirect cost rate will be charged to the contract prior to closing out the account. | ||
| 03.03 | As stated in section 01.02, remaining balances on fixed-price agreements should be small. Thus, all such funds will be closed to the Dean's account for the area in which the PI is employed (other than for university-approved institutes and centers - which will be closed to the Associate VP for Research as administrator of those). | ||
04. MAJOR RESPONSIBILITIES ASSOCIATED WITH THIS PPS
| Major responsibilities for routine assignments associated with this PPS include the following:
|
05. CERTIFICATION OF STATEMENT
This FSS/PPS has been approved by the following individuals in their official capacities, and represents FSS policy and procedure from the date of this document until superseded.
Mr. Scott Erwin, Director, Grants and Contracts Administration, Reviewer
Dr. Carolyn Conn, Associate VP, Financial Services/Treasurer, Reviewer
Mr. William A. Nance, Vice President for Finance and Support Services
| Approved: | ____________________________ Reviewer |
| Approved: | ____________________________ Reviewer |
| Approved: | ____________________________ Vice President for Finance and Support Services |