Adjusting/Correcting Non-Payroll Accounting Transactions

Sponsored Revenue

Sponsored Financial Reporting (SFR) records revenue to the appropriate project and should reflect the type of revenue being recorded (e.g., account 480101, Sponsored Grants Contract Exchange Revenue). If you have questions regarding revenue recorded on a sponsored project, contact the assigned SFR accountant to determine if an adjustment is necessary.

Non-Sponsored Revenue and Non-Payroll Expense

1. Determine the type of transaction being initiated and if it is allowable.

   Revenue is recorded in alignment with the appropriate activities. Under certain circumstances, an adjusting or correcting entry is appropriate to achieve this objective.

   Transaction type:

   • Correction of technical errors: If the wrong revenue or expense account or other chartfield string attribute was originally used to record the transaction, the error can be corrected by reclassifying or moving the revenue from the incorrect account to the correct account.
   • Redistribution of revenue or expense among chartfield strings for a common activity: In these situations, revenue or expense associated with an activity is recorded to one chartfield string on behalf of others. This is generally done for efficiency purposes. Portions of the revenue or expense are then reclassified or moved to the other relevant chartfield strings.
   • Reclass of unallowable or unallocable expenses: If an expense is determined to be unallowable on a sponsored or restricted chartfield string, the expense must be moved to a non-sponsored chartfield string. If the expense is unallocable on a project, the expense must be moved to a non-sponsored chartfield string or the correct sponsored project.
   • Elimination of deficit balance or budget overruns: At the end of an award period, expenses related to the award may exceed the budget. Unless additional funding is received from the sponsor, expenses must be moved to a non-sponsored chartfield string because the award cannot be closed out until the deficit balance is eliminated.
2. Allowable Guidlines
   • Negative revenue or expenses must not be created. Revenue and expenses must be moved within the fiscal year originally recorded.
   • Fund restrictions must be rigorously applied. Some revenue is received with restrictions placed on its use by the source (e.g., use of gift funds restricted by a donor). Some expenses recorded in unrestricted funds are not allowable in restricted funds.
   • Function must be aligned with the transaction activity.
   • To move an expense from a sponsored project (or to credit) to a non-sponsored account outside the budget/award period, notify the SFR accountant, as a revised report/invoice must be submitted to the sponsor with funds to be returned.
   • The account value must reflect the nature of the expense and the function must reflect the purpose of the expense.
   • To move an expense to a sponsored project, additional criteria must be met:
     • Under most circumstances, expenses incurred before the sponsored project was established cannot be transferred to the sponsored project.
     • The expense cannot be moved from one budget period to another solely to avoid overdrafts (as determined by sponsor regulations).
     • The expense must be allocable as a direct charge to the project. If the expense did not provide a benefit to the project, it cannot be charged to the project.
     • The expense must be an allowable project expense, as defined by University policy, sponsor's policies, and the terms and conditions of the award.
     • Sponsored projects cannot be used as a "holding" or "clearing" account for redistribution of expenses to other Chartfield Strings.
     • An expense from any project in overdraft status cannot be moved to a sponsored project for the sole purpose of eliminating the overdraft.
     • The expense cannot be moved to a project having unexpended funds for the sole purpose of expending the remaining balance.
   • To move an expense from a sponsored project (i.e., to credit a project), when the sponsored project is outside the budget/award period, additional criterion must be met: Notify the SFR accountant, as a revised report/invoice must be submitted to the sponsor, along with return of funds.
   • Adhere to proper deadlines, accounting periods, and protocol when moving revenue:
     • Transactions must be processed within 90 days from when the original revenue was posted. If the deadline is missed, a request for exception to policy is required and additional justification and approvals are necessary to be documented on Form UM 1921.
     • When moving revenue or expense transactions from a prior fiscal year, the appropriate transfer accounts should be used for nonsponsored activity.
     • No original charges older than 12 months may be moved onto a sponsored project.
     • No transactions after a final report or invoice has been submitted to a sponsor will be allowed.
   Refer to:
   • Cost transfer approval matrix(PDF)
3. Initiate and prepare the transaction
   • Prepare and enter the journal entry in the general ledger to move the revenue or expense to the appropriate chartfield string. The justification for the journal entry must be documented in the journal entry within Enterprise Financial System (EFS), noting the business purpose and address the who, what, where, when, why, and how much for the transaction. This can be accomplished using attachments or referencing the applicable information in the header long description field of the journal entry.
   • Supporting documentation is required to be accessible in Perceptive Content or in EFS.
4. Obtain approvals
   • EFS will route the journal entry for applicable approvals, including Accounting Services for central approval or Certified Approvers for entries impacting sponsored chartfield strings.
   • The general ledger will route the journal entry for applicable level of approvals if completed within 90 days of the initial transaction. Journal entries that charge a sponsored project will be routed to a Certified Approver for approval. If the journal entry debits multiple DeptIDs, certified approval from each of the departments is required. Transactions processed after 90 days from when the original charge posted, requires Principal Investigator (PI), RRC CFM, and research associate dean approval prior to the certified approval. The additional approvals are required to be documented on Form UM 1921.

If the transaction is being recorded more than 90 days after the initial transaction, complete the additional steps to request an exception:

• If the JE will credit a sponsored project and debit a cost share chartstring, complete the exception request Form UM 1921 and obtain the required approvals.
• If the JE moves charges from a non-sponsored chartstring to a sponsored chartstring, complete the exception request Form UM 1921 and obtain the required approvals. Effort re-certification may be required. The exception request form must contain both of the following:
  • A detailed explanation for the expense transfer that states how and why the original charge was not correctly assigned.
  • An explanation as to why the transfer was not made timely.
• Once the JE is submitted with the form and approved by the CA, it will route to the Controller or AVP for Research for review and approval.