ADMINISTRATIVE PROCEDURE

Adjusting/Correcting Payroll Accounting Transactions on Sponsored Projects
  1. Determine the payroll adjustment being initiated and if it is allowable

    Payroll refers to salary and fringe transactions processed in either the general ledger or HRMS. Adjustments should be processed timely.

    Transaction Type:

    • Change in effort percentages: Payroll distribution totals, expressed as a percentage of an employee's wages, must agree with the effort certification statement. It is important that the transfer is made in compliance with sponsor terms and conditions and, for projects that are ending, made before project period end.

      Refer to Administrative Policy:
      Effort Certification

    • Adjusting payroll for faculty in the nine/twelve (9/12) program: To keep payroll distributions consistent with the appointment, it is necessary to adjust the expense on a biweekly basis after the original salary has been posted.

      Refer to the Following Resources:
      9 Over 12 Payroll Adjustment

    Allowable Guidelines / Criteria:

    • Negative expenses should not be created. Expenses should have been recorded before they can be moved.
    • The account value should reflect the nature of the expense and the function should 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.

        Refer to Administrative Policy: Charging Sponsored Costs Outside the Award Period

      • The expense cannot be moved from one budget period or project 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.

        Refer to Administrative Policy: Charging of Facilities and Administrative/Indirect Costs to Sponsored Projects

      • 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" spot 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 sponsored, along with return of funds.
      • For closed effort periods, follow the process to re-certify effort.
    • Adhere to proper deadlines, accounting periods, and protocol when moving a payroll expense. Refer to:
      Cost transfer approval matrix
      • Transactions must be processed within 60 days from when the original charge was posted. This applies to expenses incurred during and after the project budget period ends. If the deadline is missed, additional justification and approvals are necessary.
      • No original charges older than 12 months may be moved.
      • No transactions after a final report or invoice has been submitted to a sponsor will be allowed.
      • HSAs are reflected on the effort statement one day after the charges appear in the general ledger. Check the calendar on SPA's website to see when the last HSA can be processed before the effort deadline. Under most circumstances, HSAs processed after the effort deadline are not allowed. If the principal investigator and the department head submit a properly detailed justification with Certified Approval, SPA will consider approving a HSA after this point. If SFR has already submitted the final report/invoice to the sponsor, no HSAs moving expenses onto the sponsored project will be allowed.

        Refer to Administrative Policy:
        Effort Certification

  2. Initiate and prepare the transaction

    If the transaction is being made after the deadline:

    • If the HSA will credit a sponsored account, include a reason why the salary and fringe is being transferred and why it is being done after the effort certification period.
    • If the HSA will debit a sponsored account, the principal investigator and department head must write a letter to the Effort Unit that justifies the cost transfer and is approved by the Certified Approver. The justification letter must contain both of the following information:
      • A detailed explanation for the salary transfer that states how and why the original charge was not correctly assigned
      • An explanation as to why the transfer was not made before the effort certification deadline.
  3. Obtain approvals
    • If the transaction is processed later than 60 days from when the original charge was posted, Principal Investigator and Certified Approver approval is required.
    • HSAs Prepared After the Effort Deadline:
      • Crediting a sponsored account: No additional approvals required. If the project is impacted by more than the defined tolerance limit of one percent, then the effort statement will require electronic re-certification.
      • Debiting a sponsored account: A justification letter, submitted by the Principal Investigator and Department Head, must be sent to the Certified Approver for approval. If the Certified Approver concurs with the request, the Certified Approver will provide the letter to the Effort Coordinator, who will scan and upload it as a pdf attachment to the electronic effort statement. The letter must be attached to the electronic effort statement before the Effort Unit will approve the HSA. Upon approval of the HSA by the Effort Unit, the cost transfer will be posted in HRMS and General Ledger and will be imported into the ECRT system and the effort statement will be re-opened for certification.
    • The Effort Unit has the authority to accept or reject the proposed transfer. HSAs that occur after effort has been certified are subject to review by auditors and the project's sponsor. An external review may result in the HSA being disallowed. The academic unit will be financially liable for any disallowed costs.
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