I. GENERAL  
II. AUTHORIZATION OF EXPENDITURES  
III. COST-SHARING  
IV. PERSONNEL REGULATIONS  
V. TIME AND EFFORT REPORTING  
VI. PURCHASING  
VII. TRAVEL AUTHORIZATIONS  
VIII. CONSULTANTS  
IX. EQUIPMENT  
X. EXCESS GOVERNMENT PROPERTY  
XI. NEGOTIATIONS OF POST-AWARD CHANGES IN PROJECT  
XII. PURCHASES NEAR TO AND AFTER TERMINATION DATE  
XIII. RETROACTIVE COST TRANSFERS  
XIV. CLOSE OUT AND AUDIT  
XV. MISCELLANEOUS 
LINKS TO EXHIBITS

It is the policy of the University to permit as much flexibility as possible to the project director in pursuance of the research or training objectives. However, awards for sponsored projects are made to the University, not the project director, with the University identified as grantee. The University thus assumes full responsibility for insuring that the program is conducted within the administrative guidelines and regulations specified by both the sponsoring agency and the University. It is the primary responsibility of the Office of Research and Sponsored Programs, as the designated institutional representative, to serve as intermediary between the agency and the project director for the purposes of negotiating changes in the project budget, modifications (reallocations, increase or decrease of funds), time extensions, and other items primarily administrative in nature. The project director has the responsibility for directing the technical aspects of the project and otherwise carrying out the research or program effort within the scope authorized by the agency and for initiating any and all expenditures of grant funds within budget and contract constraints. The Grant Accounting Office is responsible for all post award accounting and reporting activities.

Project expenditures and equipment accountability on all Federally sponsored projects are governed by Office of Management and Budget Circulars A-21 and A-110. In addition, each Federal Agency publishes a guide or policy statement on their grants which generally encompasses the requirements in A-21 and A-110. The project director should be familiar with these publications. Expenditures must conform to those guidelines as well as all University requirements. Purchase requisitions and travel authorizations must be processed through regular University channels and in accordance with existing University guidelines contained in other sections of this policy and procedure manual. General procedures for grants and contracts are as follows:
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When an award has been accepted by the University, the Office of Research and Sponsored Programs forwards to the Comptroller's Office a copy of the award notice, and a complete grant application with detailed budget and preferably an agency financial manual. A conference is scheduled with the principal investigator and Accounting Office personnel for discussion and explanation of (1) project budget line items, (2) time and effort reports, (3) budget revision process and requirements of the Agency and the University, (4) progress and technical reports required, (5) purchasing procedures, (6) close out procedures, and other items as appropriate. The grant account number to which charges are to be made is released at this time.
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Historically, federal agencies require auditable cost- sharing on the part of the University for government supported projects. The University usually has the option of meeting this cost-sharing requirement in a number of ways. The University can cost-share (a) a percentage of the time and effort of the personnel involved in carrying out the project; (b) part of the indirect cost; (c) operating expenses, etc. University cost-sharing is generally indicated at the time the proposal is submitted. The amount of cost-sharing required and the method of meeting that requirement will be indicated upon the face of the Notice of Award. In addition, any administrative notes attached to the award notice will usually indicate what is required of the project director as far as documentation of personnel time and effort, etc., to meet the cost-sharing requirements.
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All personnel involved in the project whether they are faculty, professional staff, clerical, or students, must be paid in accordance with Tennessee Board of Regents and University guidelines.
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The project director is responsible for the preparation and timely submission of the required University forms delineating the total effort of all personnel working on the project, whether charged directly to the grant or contract or used as University cost-sharing. Time reporting copies are based on each person’s signed time report generated by the TRS system. Copies of the approved time report, with any adjustments noted and approved by the employee’s supervisor, must be sent to the Comptroller’s Office by the 10^th day following the close of the pay period i.e, by the 25^th for the 15^th payroll and the 10^th of the following month for the end of the month pay period. Copies of these forms and additional information on the procedures to follow are made available at the conference referred to in Section II above.

Failure to submit required time reports will cause payroll costs to be disallowed upon audit of the grant. In order to assure appropriate documentation to comply with Federal, State, and University regulations and requirements if project director does not submit time and effort reports on a timely basis, the University may withhold grant salary payments until the required forms are received.
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Requisitions for supplies and equipment are initiated by the project director and must be submitted in accordance with the established University procedures for the purchase requests. Care must be exercised to insure that contract and grant funds are expended only for budgeted items and that the total amount of funds provided are not exceeded.
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When funds have been provided in the approved budget for travel, domestic or foreign, the project director is responsible for initiating the required travel authorization forms and submitting them through regular channels for approval.
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Due to federal audit requirements, the University must apply the same regulations to consultants hired on all research and sponsored program grants. Unless the federal grant or award specifies otherwise, the federal government will not participate in paying for overload or overtime. The payment for consultant services may not exceed the daily equivalent of the maximum rate paid a United States Government GS18 employee. Please contact the Office of Research and Sponsored Programs for the current maximum rate. Federal guidelines require that:

A. There is evidence that the services to be provided are essential and cannot be provided by persons receiving salary support under the grant or otherwise compensated for their services.

B. A selection process has been employed to secure the best qualified person available.

C. The charge is appropriate considering the qualifications of the consultant, normal consulting charges, and the nature of the services rendered.

D. If the individual is an employee of the grantee institution, consultation is across departmental lines and in addition to the regular duties or involves a separate and remote operation, and the work performed is in addition to the consultants normal departmental work load. Written requests from academic departments for consultant services are to be submitted to the Provost or Vice President for Health Affairs as appropriate. Departments other than academic are to submit requests to the Vice President for Business and Finance. When using an outside consultant, a personal service contract must be completed in accordance with the procedures in FP-14.  
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Equipment is defined as a physical resource that benefits a program for more than three years (one year for Federal projects) and costs in excess of five thousand dollars ($5,000). The definition of equipment for sponsored research varies from agency to agency. The agency's definition of equipment, if more restrictive than the state's definition, would govern. For information regarding the regulations of each agency with which you are dealing, please contact the Office of Research and Sponsored Programs. In general, any purchase of equipment must have been specified in the approved operating budget prior to its purchase. Deviation from the approved budget for equipment purchases must be submitted to the Office of Research and Sponsored Programs for required agency approval prior to purchase.
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Information on the acquisition of excess or surplus government property under a grant or contract is available from the Purchasing Office.
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All sponsoring agencies have specific requirements on the approval process which must be adhered to for changing the approved scope or work, in reallocating funds from the approved operating budget, changing the total effort to be devoted to the project by senior personnel, or changing the approved time for the project. In some instances approval must be obtained from the sponsor, while in other cases the University has been given the authority by the sponsor to approve such changes. Project directors must consult the Office of Research and Sponsored Programs on all proposed changes in these categories.
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Items not received during an award period are not of benefit to the project and are routinely disallowed on audit, even if they were legitimate charges at the time the order was placed. Therefore, orders for supplies and equipment must be placed well in advance (60 - 90 days) of the grant expiration date to ensure delivery. If additional time is needed to complete reports or acquire supplies, contact the Office of Research and Sponsored Programs to aid in securing a no-cost time extension or to make other arrangements.
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Expenditures should always be charged to the proper account initially. However, transfers must occasionally be made. An Addendum to Public Health Service Grant Manual is typical of Federal requirements:

A. The cost is a proper and allowable charge to the grant.

B. The transfer is supported by documentation, fully explained and justified.

C. The transfer is reviewed and approved by the University Comptroller and unless an obvious error was made in the original charge the transfer must be made within 120 days of the original recording of the transaction.
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Technical and financial close-out documents are due soon after the termination date of the grant. The project director is responsible for preparation of the technical report to the granting agency and will be required to provide information, when requested, on possible patents and property acquisition as well as signing the final expenditure report. Most awards are audited under the provisions of the single audit concept as contained in OMB Circular A-133. Under this OMB Circular, the Division of State Audit performs compliance and financial testing of grants and contracts during their normal audit of the university with the results reported to the university’s cognizant audit agency. However, the agency may perform a separate audit. Project directors should keep complete, accurate records in case the award is selected for comprehensive audit.
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The project director is the administrator of the project. The Comptroller's Office will record and report the financial transactions of the project in accordance with the approved project budget. Project directors who have concerns or questions regarding accounting procedures, payments under grants and contracts, cost-sharing, staff benefit charges, or indirect costs should contact the Comptroller's Office or the Office of Research and Sponsored Programs, as appropriate.
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LINKS TO EXHIBITS

Exhibit 8. A - Memo for Establishment of Preaward Account Number
    on the Office of Research and Sponsored Programs website
    http://www.etsu.edu/research/forms.htm

Exhibit 8. B - Re-budgeting Prior Approval Sheet
    PDF Format
    Word Format

Exhibit 8.C - Grant Time Report Check Sheet
    PDF Format
    Excel Format

Original effective date: April 9, 1982
Revised: October 1, 1987; November 1, 2001
Last review: November 1, 2001