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Managing Sponsored Project Funds: Determining Award Terms and Conditions

Find out how to determine awards and conditions for sponsored project funds.

Understanding award documents

If you are an Award Administrator responsible for sponsored project funds, you need to understand critical information in the award document, applicable agency guidelines, and federal guidelines (OMB Uniform Guidance). Review the documents attached to your award and make note of anything that will help you support the Principal Investigator (PI).

List of terms and related questions

Use this list to help you identify essential information in the award documents:

  • Project period: What is the earliest beginning date and the last termination date for all periods of the project? This may include several budget periods.
  • Award amount for the project period: What is the cumulative amount legally committed and encumbered by the agency for all budget periods? This may include obligated funding for a current budget period plus pending funding for future periods.
  • Budget period: Does the award specify annual periods for performance, spending, or payment for a project continuing for more than one year? When do each of these annual periods start and end? What are the terms for each budget period?
  • Award amount per budget period: Has the agency specified an amount obligated or restricted for a specific budget period? Has the agency committed only a portion of the total project funding at the time the award is executed?
    • If the agent has committed only a portion of funding, what are the conditions for future pending funding to be activated or become obligated? For example, when the future budget period is reached, is funding automatically obligated or will the agency send formal notice?
    • If the award specifies a limit on what can be spent for each budget period, what are the terms regarding overspending or underspending?
    • Many agencies fund projects in increments. Look for terminology that requires an accounting for each budget period and a refund of the unexpended balance for each period. In these cases, you might need approval to spend an unexpended balance past the termination date or to spend more than the budgeted amount.
  • Award budget: Determine the amount awarded for each budget period, if applicable, and for each expense category (i.e., salary, supply and expense, travel, equipment, indirect costs).
  • Unallowable expenses: Determine expenses the agency doesn't allow as a direct cost. (For example, foreign travel is not allowed by many agencies.)
  • After reviewing the agency terms, check to see if any normally unallowable expenses are approved in the award budget. Generally, if an expense is approved in the budget, the agency has approved it as a direct cost.
    • For federal funds, OMB Uniform Guidance cost principles may override approvals in the award budget. For guidance on expense allowability, contact Sponsored Projects Finance (SPF) award accountant for that granting agency.
  • Expense limitations: Are any expense categories limited to a specific amount within a budget or project period? For example, many agencies limit the amount that can be spent on travel for each budget year.
  • Rebudgeting requirements: If expenses exceed the budget for a particular category or if the PI wants to spend in categories not previously budgeted, what are the terms for changing the approved budget? Some agencies allow a deviation within approved categories and some require approval for any change.
  • Billing and payment terms: Is the award payment basis fixed price or cost reimbursable? Are there specific billing and payment terms and instructions?
    • In general, most federal and private contracts and federal grants are billed in some manner. Grants from private sponsors are usually not billed.
    • If the award requires billing, look for the billing schedule and additional requirements such as detail to be included on the invoice itself (e.g., breakdown of salary by position, etc.) or reports to be submitted with the bill (e.g., cost-share report, equipment report, etc.).
      • If billed, SPF submits invoices to the agency and records them in the accounts receivable system (ISIS). The department is responsible for providing SPF with the other required reports or attachments.
    • If the award does not require submission of an invoice, look for terms regarding the amount and frequency of payment. Look for the manner of payment (check, wire transfer, etc.).
    • If you receive checks for any of your sponsored project awards, contact SPF for deposit instructions.
  • Cost Sharing requirements: Contributions to the project for personnel or other expenses to be paid from other fund sources are considered mandatory cost sharing, if included in the award documents.
    • Check the approved budget for salary or other itemized expenses budgeted at zero cost to the project.
    • Review the budget narrative for language committing personnel time or other expenses at no cost to the project.
    • If cost-sharing commitments are included, the University is required to track and report these, and the PI must certify this contribution to the project.
    • See more information on cost sharing.
    • For specific details about cost-sharing requirements, see PPM 150-45.
Find answers, request services, or get help from our team at the UC San Diego Services & Support portal or call the Finance Help Line at (858) 246-4237.