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  1. 1. The University of Texas at Arlington Office of Research and Office of Accounting and Business Services Brown Bag Training Session Three: The 1,2,3’s of Budget Preparation
  2. 2. The 1,2,3’s of Budget Preparation and Management Presenters: Preparation: Rae Schofield Management: Brent Norman
  3. 3. Goals and Objectives <ul><li>1 ~ Read the Proposal/Agency Guidelines and Evaluate your Budget Needs </li></ul><ul><li>2 ~ Elements of the Budget </li></ul><ul><li>3 ~ Special Requirements and Restrictions </li></ul>
  4. 4. 1 ~ The Guidelines and Budget Needs <ul><li>The guidelines tell you: </li></ul><ul><li>Your dollar limit, if any </li></ul><ul><li>Which costs are allowable </li></ul><ul><li>Evaluating your budget needs: </li></ul><ul><li>Does the scope of your project fit the solicitation? </li></ul><ul><li>Will cost needs exceed the allowable dollar limits? </li></ul>
  5. 5. 2 ~ Elements of the Budget <ul><li>Types of Costs: </li></ul><ul><ul><li>Direct </li></ul></ul><ul><ul><ul><li>e.g. salary, fringe benefits, travel, equipment, lab supplies </li></ul></ul></ul><ul><ul><ul><li>Are easily associated with a specific project </li></ul></ul></ul><ul><ul><li>Facilities & Administration (F&A) </li></ul></ul><ul><ul><ul><li>Also known as Indirect Costs (IDC) </li></ul></ul></ul><ul><ul><ul><li>e.g. utilities, admin support, general office supplies </li></ul></ul></ul><ul><ul><ul><li>Can be associated with many other sponsored projects or cannot be easily associated with a specific project </li></ul></ul></ul>
  6. 6. 2 ~ Elements of the Budget <ul><li>Types of Direct Costs </li></ul><ul><ul><li>Salaries: </li></ul></ul><ul><ul><ul><li>UTA Employees who will direct effort to the grant, e.g. PIs, Post Docs, Students </li></ul></ul></ul><ul><ul><ul><li>Should reflect the amount of time that person will spend on the project </li></ul></ul></ul><ul><ul><li>Fringe Benefits: </li></ul></ul><ul><ul><ul><li>Should reflect UTA’s approved rates for the associated position </li></ul></ul></ul><ul><ul><ul><li>Includes: Health Insurance, Social Security, Retirement, Vacation/Sick Leave, FICA, OASI </li></ul></ul></ul>
  7. 7. 2 ~ Elements of the Budget <ul><li>Types of Direct Costs </li></ul><ul><ul><li>Equipment </li></ul></ul><ul><ul><ul><li>Must be identified and justified in proposal </li></ul></ul></ul><ul><ul><ul><li>Costs $5,000 or more and has a lifetime of 1 year or more, including fabricated equipment </li></ul></ul></ul><ul><ul><li>Consultants </li></ul></ul><ul><ul><ul><li>Used to pay experts outside UTA who provide professional advice or service </li></ul></ul></ul><ul><ul><li>Publications </li></ul></ul><ul><ul><ul><li>e.g. manuscript illustration, reprints, page charges </li></ul></ul></ul>
  8. 8. 2 ~ Elements of the Budget <ul><li>Types of Direct Costs </li></ul><ul><ul><li>Research and Expendable Supplies </li></ul></ul><ul><ul><ul><li>Identified and justified in the proposal </li></ul></ul></ul><ul><ul><ul><li>Must be clearly associated with, and necessary to, that particular project </li></ul></ul></ul><ul><ul><ul><li>Must be expended only for the associated project </li></ul></ul></ul><ul><ul><ul><li>Examples are: chemicals/glassware, small electronics, software, animals, ect. </li></ul></ul></ul>
  9. 9. 2 ~ Elements of the Budget <ul><li>Types of Direct Costs </li></ul><ul><ul><li>Travel </li></ul></ul><ul><ul><ul><li>Identified and justified </li></ul></ul></ul><ul><ul><ul><li>Includes: transportation, room and board </li></ul></ul></ul><ul><ul><ul><li>Must be directly related to the project </li></ul></ul></ul><ul><ul><li>Subcontracts </li></ul></ul><ul><ul><ul><li>Must provide a substantial programmatic contribution </li></ul></ul></ul><ul><ul><ul><li>At a minimum require a detailed budget, budget justification, work statement, and institutional endorsement </li></ul></ul></ul><ul><ul><li>Tuition </li></ul></ul><ul><ul><ul><li>Not permitted on federal awards </li></ul></ul></ul>
  10. 10. 2 ~ Elements of the Budget <ul><li>Types of Direct Costs </li></ul><ul><ul><li>Copying & Duplication </li></ul></ul><ul><ul><ul><li>Only allowable for unusual costs such as: large survey instruments, test, questionnaires, work shop procedures, program brochures </li></ul></ul></ul><ul><ul><ul><li>Identified and justified </li></ul></ul></ul><ul><ul><li>Other Direct Costs </li></ul></ul><ul><ul><ul><li>e.g. renovation of space, off campus facility rentals, long distance charges, participant support costs </li></ul></ul></ul>
  11. 11. 2 ~ Elements of the Budget <ul><li>F&A Costs </li></ul><ul><ul><li>Expressed as a percentage of S&W, MTDC, TDC </li></ul></ul><ul><ul><li>The rate is negotiated with the federal government </li></ul></ul><ul><ul><ul><li>MTDC excludes: </li></ul></ul></ul><ul><ul><ul><ul><li>Equipment over $5,000 </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Portion of each subaward in excess of $25,000 </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Tuition remission </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Off campus facility rental </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Alteration and renovation </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Participant support costs </li></ul></ul></ul></ul>
  12. 12. 2 ~ Elements of the Budget <ul><li>F&A Costs </li></ul><ul><ul><li>On-Campus vs. Off-Campus </li></ul></ul><ul><ul><ul><li>To be considered off-campus you must be paying rent for the facilities out of the program budget </li></ul></ul></ul><ul><ul><ul><li>The budget must be divided between on-campus and off-campus activities </li></ul></ul></ul><ul><ul><ul><li>You must specify where the work will be done and how long it will last </li></ul></ul></ul>
  13. 13. 2 ~ Elements of the Budget <ul><li>The Budget Justification </li></ul><ul><ul><li>Identifies your costs and explains the need for them </li></ul></ul><ul><ul><li>Answer any questions a reviewer may have about how you calculated your costs </li></ul></ul><ul><ul><li>Indicates the basis salaries and for any yearly increases </li></ul></ul><ul><ul><li>Should reflect the objectives of the project </li></ul></ul>
  14. 14. 3 ~ Special Requirements and Restrictions <ul><ul><li>Does the agency require cost share? </li></ul></ul><ul><ul><li>Do they require special travel considerations? </li></ul></ul><ul><ul><li>Do they limit F&A? </li></ul></ul><ul><ul><li>Do they prohibit certain cost categories? </li></ul></ul><ul><ul><li>Specific forms or format? </li></ul></ul><ul><ul><li>Remember that the budget can be reduced upon award leading to a reduction in scope as well. </li></ul></ul>
  15. 15. Budget Preparation <ul><li>Start early </li></ul><ul><li>Contact your OR representative and let them help you </li></ul><ul><li>Ask questions </li></ul><ul><li>Construct your budget </li></ul><ul><li>Incorporate it into your proposal </li></ul>
  16. 16. Other Resources <ul><li>OR Website: </li></ul><ul><li> </li></ul><ul><li>NSF GPG: </li></ul><ul><li> </li></ul><ul><li>NIH Forms and Applications: </li></ul><ul><li> </li></ul><ul><li>OMB Circulars: </li></ul><ul><li> </li></ul>
  17. 17. Budget Management <ul><li>Establishing Budgets </li></ul><ul><li>Grant Expenditures </li></ul><ul><li>Explanation of Receivables Categories </li></ul><ul><li>Budget Modifications </li></ul>
  18. 18. 1. Establishing Budgets <ul><li>Budgets are entered upon receipt of a written, approved authorization from an outside agency. </li></ul><ul><li>Grant </li></ul><ul><li>Contract </li></ul><ul><li>Modification to an existing account </li></ul>
  19. 19. 2. Grant Expenditures <ul><li>All allowable, allocable direct charges should be applied to the grant as they are incurred. </li></ul><ul><li>All requests to transfer expenditures to a grant should be in writing (email) with justification to the Grant Accountant and include the following: </li></ul><ul><li>Document number or voucher number </li></ul><ul><li>Dollar amount </li></ul><ul><li>Account number where expense was charged </li></ul><ul><li>A copy of the invoice or receipt to support the request </li></ul>
  20. 20. 3. Receivables Categories <ul><li>Budget Categories 91 and 92 reflect the receivables for the account. </li></ul><ul><li>91 Commitment Receivable – Begins as the total amount of the awarded budget and is reduced as billings are recorded </li></ul><ul><li>92 Billings Receivable – Begins as zero and increases to reflect the total amount billed </li></ul>
  21. 21. 4. Budget Modifications <ul><li>Budget Transfers: </li></ul><ul><li>All budget transfer requests should be written (email) and submitted to the Office of Research for approval. </li></ul><ul><li>A transfer involving a category subject to F&A and one not subject to F&A will have an impact on the F&A budget. </li></ul><ul><ul><li>Example: 50% F&A rate, transfer $100 from 50 to 80, must also transfer $50 from 90 to 80. </li></ul></ul>
  22. 22. 4. Budget Modifications <ul><li>Modified By Sponsor: </li></ul><ul><li>Modification letter from the sponsor through the Office of Research </li></ul><ul><li>Budget revision by the Office of Research </li></ul>
  23. 23. Brown Bag Training Session Four <ul><li>Wednesday January 22, 2003 </li></ul><ul><li>Gifts vs. Grants </li></ul>