Cost transfers refer to the shifting of expenses between accounts.
Federal guidelines (OMB A-21) for cost transfers state, in part, "any costs allocable to a particular sponsored agreement may not be shifted to other sponsored agreements in order to meet deficiencies caused by overruns or other fund considerations, to avoid restrictions imposed by law or by terms of the sponsored agreement, or for other reasons of convenience."
Occasionally, it may be necessary to transfer costs to a sponsored project or from one sponsored project account to another due to clerical error or information that becomes known after the charge has been processed.
Due to audit requirements and governmental oversight (federal and state) the following guidelines apply for such transfers (See UM Business Policy Manual, Section 213):
- Transfers must be made in a timely manner.
BPM-213 states that cost transfers should be made within two accounting periods (two months) after the end of the accounting period in which the original transaction posted; e.g. if a transaction posts with a February 2 date, any corrections must be made by the end of the accounting period for April.
- All transfers must include an explanation of the error or need for the transfer.
"Correct error,” "transfer expense, “or similar versed statements are not adequate justification and will be returned for satisfactory explanations. If transferring to another sponsored agreement, include an explanation of why the expenditure belongs on the account to which you are transferring the costs.
- Salary transfers that are older than the timeframe described above must have ORS approval and an explanation for the delay of the transfer.
See the Effort Reporting menu for the proper Payroll Correction Entry (PCE) procedure.