Accts

Establishment Of Accounts

Page synopsis: This page contains:

A. Three ways to obtain an account (advance; hardship; standard).

B. Information regarding general research accounts and guidelines to obtain one.

C. Links to the MSU developed accounting program DEPACT.

D. Alert as to the need for human and animal approvals prior to obtaining an account.

An account number may be established under one of three circumstances (please ensure you read the information at the bottom of this page if your research project involves humans or animals).

1. An "advance account".

2. A "hardship account". The following method can be used to request a hardship account.

The PI or another individual within the department drafts a memo. The memo should include the following information.

A. What information gives the academic unit a reason to believe that the sponsor will execute a contract / grant that will provide funding, or increase the funding and/or period of performance. Please provide enough detail so that an informed determination can be made as to the basis supporting the "reasonable expectation" of new or continued funding and/or period of performance. It is advisable to also provide any relevant correspondence that was exchanged with the funding party.

B. Include any restrictions that should be placed on the hardship account. One option is that this office only allows the "hardship" account, or an extension of an existing account on a "hardship" basis, for personnel action only. Or the request can be to only allow certain costs, e.g., for supplies only; for equipment and travel. Other possible options can be for all costs but only up to a total amount, e.g., $5,000.00. Or that costs be only allowed for a limited period, e.g., 1 January-31 March, 200X. Please ensure the request clearly states any limitation the academic unit wishes placed on the account.

C. An assurance must be included that states that if the contract / grant, or an amendment to increase funding and/or the period of performance, is not executed, then the academic unit will be responsible for, and transfer the disallowed charges off of, the subject account. This transfer must be completed within a reasonable period of time after the failure to obtain the full execution of the contract / grant / amendment.

D. The individual who is requesting the hardship account must sign the memo. In addition, the academic unit providing the assurance discussed in item C above must have a signature by an individual who is authorized to sign on behalf of the unit. If the anticipated contract / grant / amendment is less than $100,000.00 for a period of performance of a year or more then the signature on behalf of the department / office / center is sufficient. However, if the anticipated contract / grant / amendment is for more than $100,000.00 then the memo must also be signed on behalf of the college or equivalent level office.

F. Please note that a transmittal with the proposal and budget must be processed prior to any consideration of the hardship request.

G. Approval for animal use or human subjects must be obtained prior to an account of any type being released to the PI and department.

3. A fully executed contract has been completed, i.e., the contract has been signed on behalf of all contract parties.

General Research Accounts

This is an account that can be set up for a faculty member to use for his/her unrestricted research funds received from external non-government funding parties. The type of funding eligible for processing into this type of account is described below.

Funding that can be processed into this type of account can be either "reimbursable" or fixed price. This funding will NOT be restricted (by this office) as to period of performance or as to budget (though a period of performance may be a restriction in regards to the submission of a final progress report). This office is NOT required to provide an expenditure report/financial information. While most general research accounts are set up at zero percent (00%) indirect cost this will not prevent the processing of funding that is subject to indirect cost. Any indirect cost due from funding processed into the account will be removed as a one-time adjustment. Funding in this type of account is for unrestricted research of a general nature, i.e., not specified by the funding party for any designated project. However, even if the funding party does designate the funding for a specific project, but does not indicate to CGA in any of the documentation provided directly or through the PI/Dept./Coll. that the funding party is at all interested in, or desires, the return of any remaining funding at the conclusion of the project, then these funds could be processed into the account.

When a faculty member requests a general research account certain information must be obtained. The following inquiry is forwarded to the faculty member's department in order to obtain that information.

CGA has had to become more diligent in the opening of general research accounts due to the easy proliferation of such accounts and the resultant increase in administrative oversight. As a result, there must be a screening of the requests which must include the following information.

1. Does the faculty member expect to receive approximately $5,000.00 within the next year that will be sufficiently unrestricted to be eligible for processing into a general research account? The following gives a description of the funding that can go into this type of account.

Please note the funding that can be processed into this type of account can be either reimbursable or fixed price and will NOT be restricted (by this office) as to period of performance, or as to budget (though a period of performance may be a restriction in regards to the submission of a final progress report). This office is NOT required to provide an expenditure report/financial information. While the account is being set up at zero percent (00%) indirect any indirect cost due from any funding processed into the subject account will be removed as a one time adjustment. Funding is for unrestricted research of a general nature, i.e., not specified for any designated project. Or, if for a designated project, while not fixed price, the funding party does not indicate to this office, in any of the documentation provided directly or through the PI/Dept./Coll., that the funding party is at all interested in, or desires, the return of remaining funding, if any, at the conclusion of the project.

2. If the answer to # 1 above is yes, does the faculty member reasonable expect to receive a level of annual funding of the same amount, i.e., $5,000.00 or more, for at least the next few years?

If the funding level will not reach this level and period of time does your department have a departmental general research account? If not, one can be assigned for the department to use for faculty members who may have general research funding activity that is too low to warrant setting up an individual general research account.

Each department can have a general research account for the funds received by faculty members who do not expect to reach the level of unrestricted funding discussed above.

Individual accounting can be maintained in an individual or a department general research account by use of MSU's DEPACT program.

General research accounts will be assigned from the "71" prefix series of accounts ("61" accounts are used for restricted funds). Unless there are extraordinary circumstances each faculty member should have only one individual general research account. Each department should only have one general research account to use for department faculty members whose unrestricted funding level does not meet the amounts discussed above.

In some cases a "single use 71 account" can be converted to a general research account if the faculty member does not have a general research account and if she/he meets the general guidelines outlined above.

Prior to being able to establish an account under any of the methods described above the faculty member must have obtained the proper approvals if human subjects or animals are to be used in the research project. Questions may be addressed at the following Web sites or by contacting the relevant office.

University Committee on Research Involving Human Subjects

University Laboratory Animal Resources

JFS 29 Nov. 2005