Corresponds with: OSR Policy 500.20 – Cost Transfers

Procedure Statement

The following cost transfer procedures have been established to comply with the requirements of OMB Uniform Guidance, 2 CFR Part §200, Subpart E, the National Institute of Health (NIH) Grants Policy Statement, and the requirements of other Federal sponsors.

Policy Reminders – Timeframes for Cost Transfers:

  • Non-Salary cost transfers: must be prepared and submitted within 90 days from the date the transaction is charged to the project.
  • Salary cost transfers: related to the effort certification process must be prepared and submitted within 30 days after the end of the effort certification period to reconcile the salary expenditures to the individual’s certified effort.

University policy does not supersede sponsors’ policies that require a shorter period for cost transfers and/or corrections to effort.

Forms/Instruction

  1. Cost Transfers within the 90 Day Time Period
  2. For cost transfers initiated within the 90-day time period, a journal entry must be submitted with justification to include the following:

    • A detailed explanation of the reason for the transfer; explanations such as “to correct an error” or “to transfer to correct project” are not adequate
    • An explanation of the allocation of the cost if only a portion of the original cost is being transferred
    • Why the charge(s) are allowable, allocable, consistent, and reasonable, based on the terms and conditions of the project being charged

    Adequate documentation related to the transfer and original expense must be attached to the journal and kept on file within the department until the applicable record retention requirement has been satisfied.

  3. Cost Transfer after the 90 Day Time Period
  4. For cost transfers initiated outside of the 90 day time period, additional justification must accompany transfer requests to include the following:

    • Why the original expenditure did not charged appropriately
    • How this expense benefits the project being charged
    • Why the charge(s) are allowable, allocable, consistent, and reasonable, based on the terms and conditions of the project being charged
    • Why this cost transfer is being requested more than 90 days after the original transaction date
    • The steps that will be taken to prevent this type of error from happening in the future

    Adequate documentation related to the transfer and original expense must be attached to the journal and kept on file within the department until the applicable record retention requirement has been satisfied.

Cost Transfer Examples

ALLOWABLE UNALLOWABLE
  • Transferring pre-award costs from a University fund to the sponsored project, if pre-award spending is allowable per the sponsor guidelines
  • Correcting clerical errors, transpositions, or mistyped entries
  • Reallocating costs originally charged to a central administrative location, or when multiple projects benefit
  • Reallocating salary expenses to match effort distributions
  • Transfers for purposes of fiscal expediency without regard to whether the cost is appropriate on the receiving project (e.g. reallocation of expenses from a project in deficit to a project with unexpended funds to clear the account in deficit)
  • Transfer of post term expenses to another project
  • Transfer of an expense that was previously transferred

Revision History

Prior Revisions: 12/1/2017Revised procedure to align with policy updates to clarify expectations of timely cost transfers.

The policies in the Office of Sponsored Research Policies & Procedures Manual supersede any OSR policies, procedures and appendices previously included in the University Business Manual, a publication of UNC Chapel Hill’s Finance Division.