Sponsored Programs FAQ

Sponsored Programs FAQ

As defined in OMB Circular A-21, "F&A costs are broad categories of costs. "Facilities" is defined as depreciation and use allowances, interest on debt associated with certain buildings, equipment and capital improvements, operation and maintenance expenses, and library expenses. "Administration" is defined as general administration and general expenses, departmental administration, sponsored projects administration, student administration and services, and all other types of expenditures not listed specifically under one of the subcategories of Facilities (including cross allocations from other pools)."

In other words, F&A costs are institutional costs not easily identifiable with a particular project or activity, but are necessary for the general operation of the institution. The terms "F&A costs" and "indirect costs" are often used interchangeably.

Once the proposal has been awarded from the funding agency Sponsored Programs Administration sends the original award to Sponsored Programs Accounting in the Controller's Office. A copy of the award is also emailed to the Principal Investigator (PI) and the budget manager. Sponsored Programs Accounting then sets up a restricted fund number for the award based on who the prime funding source (Federal, State, County/City, or Private) is. The organization code and the program code are identified on the Internal Approval Sheet.

Once the fund number has been set up in Banner the budget is loaded based on the approved budget in the award. An email is then sent to the PI, departmental contact, and Sponsored Programs Administration identifying the following items:

  • PI
  • Sponsor
  • Project Title
  • Award Amount
  • Sponsor Award Number
  • University Account Number (Banner Number: Fund-Org-Program)
  • MSU Award Number
  • Budget Period
  • Cost Share Requirements
  • Title to Equipment

If any of this information is incorrect in the email, please notify us immediately.

We use the following guidelines to set up the program code:

Instruction: 011000 - General Academic
Research: 022000 - Individual on Project Research
021000 - Institute and Research Center
027000 - MAFES Research
Service: 032000 - Family and Consumer Education
031000 - Academic and Public Service
033000 - Enterprise and Community Resource Development
034000 - 4-H Youth Development
037000 - Agriculture

The department should complete a Preliminary Account Request (PAR) form and forward it to their Sponsored Program Administrator. All questions about the form should be directed to your Administrator. When filling out the form, make sure all the blanks are completed and a budget is attached. If this is not done, the process will be slowed down tremendously. The Sponsored Program Administrator will then forward the form to Sponsored Programs Accounting where they will set up a temporary fund. When the temporary fund is set up, it is assigned a fund number but no budget is loaded. The department contact will receive an email from Sponsored Programs Accounting once the PAR is set up. The department can then start spending money on that project. The PAR serves as an understanding that the department can start spending on that project, but if for some reason MSU does not receive the award money, the department is responsible for the expenditures.

Cost share is any cost on a sponsored project that is not paid by the sponsor. Cost share can be mandatory (required by the sponsor) or voluntary. The terms "cost share," "match," and "in-kind" are often used interchangeably. MSU defines cost share/match as any expenditure borne by the University and in-kind costs as expenses borne by an external organization.

It is the responsibility of the Principle Investigator and the department for making sure all cost share commitments, including those offered by a third party, are met. The PI and the department must make sure cost share expenses are booked to the cost share fund in a timely manner and budget transfers must be completed periodically to cover these expenses.

Restricted funds with cost share have a corresponding fund that is set up at the time the sponsored account is established to track cost share expenses. Cost share fund numbers start with an 8 and end with the last five digits that tie to the sponsor fund.

Third party and in-kind cost share must be approved in the budget and documentation should be provided to Sponsored Programs Accounting on a timely basis so expenses can be reported on the invoices submitted to the sponsor.

The transfer of funds from the cost sharing source to the cost share fund (8xxxxx) needs to be done periodically. It is important that expenses occurring during a fiscal year are covered within that same year.

To transfer funds to cover cost share expenses, the department must complete a Request for Budget Transfer. Once completed, the form needs to be mailed to Budget at Mail Stop 9602. If the department cost shares from a general fund it will be a two part entry. For example, if $10,000 in salaries is required for cost sharing, the following entries are required:

Part 1:

  Fund Org Account Program Amount
Transfer From: 100000 xxxxxx 401000 011000 $10,000
Transfer To: 100000 xxxxxx 409000 011000 $10,000

Part 2:

  Fund Org Account Program Amount
Transfer From: 100000 xxxxxx 409101 011000 $10,000
Transfer To: 8xxxxx xxxxxx 359101 xxxxxx $10,000

If the department cost shares from a designated fund, the following entry is required:

  Fund Org Account Program Amount
Transfer From: 25xxxx xxxxxx 409101 xxxxxx $10,000
Transfer To: 8xxxxx xxxxxx 359101 xxxxxx $10,000

Sponsored Programs Accounting will prepare a closeout sheet to ensure that all costs are included in the final invoice to the sponsor. The closeout sheet will be sent to the Budget Manager. The sheet should be reviewed for accuracy and noted if any charges need to be made for items that have not posted to the ledger yet. Documentation must be provided for all outstanding expenses. The Principle Investigator should be a part of this review to ensure he/she agrees with the final figures. The closeout form should be signed by the Budget Manager and/or PI and returned to Sponsored Programs Accounting. The final invoice will then be submitted to the sponsor based on the figures on the signed closeout. Once the final invoice has been submitted, no additional costs will be allowed.

Once Sponsored Programs Accounting receives final payment from the sponsor, the fund will be terminated.

Upon expiration of a fixed price project with an unspent balance, Sponsored Programs Accounting requires a Certification of Expenditures (COE) to be on file before the fund can be closed out. Sponsored Programs Accounting will notify you by email to complete this form. Once the final overhead has posted and the final payment has been received from the funding agency, Sponsored Programs Accounting will close the fund balance to the appropriate department's residual fund, or keep the money in the current account and extend the project end date for further research, based on what is requested on the COE.