Monthly Review and Quarterly PI Review and Certification

Following is an overview of monthly review and quarterly certification requirements and procedures.

Contact

Questions about this topic can be answered by:

Hemenway, Marilou

Director, Research Financial Reporting

Policy and Compliance

(650) 725-9107

Review and Reconcile Monthly Expenditure Statements

Monthly expenditure statements for sponsored project and cost sharing accounts are the official record of project expenses and the basis for cost reimbursements to Stanford.

These expenditure statements must be reviewed each month by a knowledgeable individual, i.e., the PI or designee so that adjustments can be made in a timely manner, and rates of expenditures can be monitored to assure availability of funds.

Beginning with the September 2013 expenditure statements, the requirement to document your review by a signature on the Monthly Expenditure Detail Report, RM3 285 has been rescinded. It has been replaced by a new requirement: you must certify your review quarterly via your signature on the Quarterly RM3 149 Report.

You must continue to review monthly expenditures. To be considered timely, monthly expenditures must be reviewed within two months of the end of the month being reviewed.

The financial administrator confirms: I have reviewed the three months of expenditures for this quarter. To the best of my knowledge, all expenditures are appropriate. Where required, corrections have been or will be made through the accounting system. I understand that to be considered timely all corrections must be made within two months of the last day of month being reviewed.

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What is Reconciliation?

Reconciliation is the process of comparing the entries on these key reports to supporting documentation and resolving any discrepancies. Reconciling accounts on a regular basis, after month-end close, will help you to manage your sponsored funds to ensure that expenditures and revenues are within appropriate limits and guidelines.

Reconciliation is an internal mechanism that ensures that:

  • entries and balances are accurate and valid
  • records are accurately recorded
  • unauthorized changes/charges did not occur
  • discrepancies are resolved in a timely fashion

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How Do I Reconcile?

  1. Review recorded transactions and investigate those that you don't recognize or appear unusual.

  2. Compare transactions to source documents as needed.

  3. Review infrequent transactions.

  4. Investigate and resolve differences.

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Key Components of Reconciliation

Below is a summary of key components to review. Your review process may be more or less detailed than the process listed below depending on many factors, such as front controls, experience, knowledge, the type of transaction, and the associated risk.

Confirm for all expenditures:

  • the expenditures belong on the PTA
  • the amount charged is accurate
  • the correct Expenditure Type was used

Salary    

You must confirm:

  • the amount charged is the same as the percentage planned
  • for hourly employee, verify hours are correct if amounts charged appear unusual 
  • correct expenditure type was used (based on JCC codes)
  • earning codes (for reconciliation)

Benefits

Ensure proper documentation of all vacation/sick leave taken by use of the AXESS time keeping system.

Equipment 

Verify the expenditures on statement are what you expected.

Ensure:

  • amount charged is consistent with order information if needed
  • the correct expenditure type was used
  • those with multiple allocations are correctly allocated and the rationale for allocation is documented
  • equipment is received in period by reviewing the packing slip-if the purchase is near the start or end date of an award
  • equipment is properly recorded in Sunflower within 30 days of receipt

Supplies

Verify the amounts charged are what you expected, and review source documents as needed to investigate unexpected amounts. 

Confirm:

  • the expenditures belongs on the PTA
  • the amount charged is accurate
  • the correct expenditure type was used

Travel

Verify the amounts charged are what you expected. Verify the travel is allowable on the project. Reconcile expenditures to the source documents as needed. Confirm the correct expenditure type was used, considering unallowable codes as needed.

Other Expenses

Verify the amounts charged are what you expected and review source documents as needed to investigate unexpected amounts.

Consultant/Subawards  

Verify the amounts charged are what you expected and reconcile expenditures to the invoice submitted.

Confirm:

  • the invoice amount is within budget
  • the correct expenditure type was charged (especially after the first $25,000 of a subaward)
  • the subrecipient has complied with award terms

Fringe/Indirect Cost/Infrastructure 

Ensure the correct rate is being applied (review rate posted in "dept ref" column). Do not calculate the rates only verify the correct rate is being used!

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Review Expenditure Detail Reports Monthly

In addition to monthly reconciliation, the Expenditure Detail Reports must be reviewed each month. The review should include compliance areas such as those covered in the detailed steps below.

Beginning with the September 2013 expenditure statements, the requirement to document your review by a signature on the Monthly Expenditure Detail Report, RM3 285 has been rescinded. It has been replaced by a new requirement: you must certify your review quarterly via your signature on the Quarterly RM3 149 Report.

You must continue to review monthly expenditures. To be considered timely, monthly expenditures must be reviewed within two months of the end of the month being reviewed.

 

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Steps in Monthly Review

Process
Current Guidance
Tools & Reports to Assist this Process

Does the budget match the award, or other budget information?

Verify the expenditure report matches the sponsor & Stanford's  Notice of Award, make sure tasks are opened if cost sharing is required.

Sponsored: To verify budget accuracy, use the sponsor's Notice of Award.

Capital Projects: Contact Capital Accounting if you have questions about the budgets.

Review Cardinal Curriculum Managing Sponsored Projects

Reports available in ReportMart3:

  • FIN_REF_216_Award_Config_Report (realtime)

  • FIN_BGT_211_PTA_Budget_Report (Daily)

  • FIN_BGT_165_Current_iBudget_Sum (realtime)

  • FIBGT_166_iBudget_Download (realtime)

If the PI is rebudgeting, is it allowed by the sponsor?

Note: A change in scope always requires approval.
 

Refer to Sponsor Notice of Award document terms and conditions

Review Cardinal Curriculum Managing Sponsored Projects

Are there any unusually large or small expenditures in relation to the budget, prior months' trends, or other expectations?

  1. Do you see any unexpected charges?

  2. Are there expected charges that are NOT here?

  3. Are expenses for all budgeted accounts reviewed monthly to ensure that any unplanned variances are identified and brought to the attention of unit management

If  so, correct “genuine ”errors, such as:

  • An incorrect PTA or Expenditure Type (corrected with iJournal)

  • An incorrect salary charge i.e., a person was incorrectly charged to your PTA (corrected with LD Adjustment)

  1. Review for obvious, large missing charges.

  2. Salaries may be held in an Org suspense account, and must be cleared in a similar manner. Refer to the "Salary Step".

Review the Commitment Management System (CMS).

The following policies, reports, and job aids are available for your reference and use:

Administrative Guide Memo 3.1.3 “Activity/Accounts”

Tips for Budgeting & Forecasting

Overview of iJournal Module of Oracle Financials

Cost Transfer Policy for Sponsored Projects

Overview: About the Labor Distribution Module of Oracle Financials

Reports available in ReportMart3:

  • FIN_LABOR_173_Suspense_Account
    (Daily)

  • FIN_EXP_150_Spo_Funded_Amt_Vs_Act_OD (realtime)

Are all expenses:

  • Allowable: Do you see any unallowable costs (based on A-21 or on the specific terms and conditions of this award), and if so, have corrections been initiated?

  • Allocable (they benefit the project)

  • Reasonable (to a prudent person)

  • Consistent (with Stanford and sponsor policies)

Review for compliance with policies.

Allocability Discussion

List of Unallowable Expenditure Types

Reports available in ReportMart3:

  • FIN_IOU_266_Other_Check_Trans
    (realtime)

  • FIN_EXP_148_Purch_Order_Recon
    (realtime)

  • FIN_EXP_138_Invoice_Detail_Recon
    (realtime)

Are salaries appropriate and charged to the appropriate PTA and Expenditure  Type, or if not, have corrections been initiated?

Salaries may be held in an Org suspense account and must be cleared. If you have questions about whether or not you have salaries in a suspense account, contact your department administrator.

Corrections to salary errors are done with a LD Adjustment; expenditure type corrections must be processed through the Payroll Department.

If a wrong PTA was used, correct through an iJournal. To ensure these errors don’t repeat, make the change in the Labor Distribution schedule.

Check the "Quick Steps: Calculate Vacation Accrual"

Reports available in ReportMart3:

  • FIN_LABOR_167_Earnings_Dist_Plan (realtime)

  • FIN_LABOR_170_Earnings_Dist_PTA (realtime)

Does effort for "Key Personnel" appear to match the award, or if not, are sponsor notifications required?

Note: A change in scope or a reduction in PI effort of 25% or more requires sponsor approval. Propose salary as anticipated by the project scope.

Review the effort committed in the awarded budget & Sponsor's Notice of Awards.

See Major Topic Effort

Does the NIH salary cap apply to any of these charges, and if so, was it properly treated?

The difference must be identified on the PeopleSoft Job Earnings Distribution Panels using the special Expenditure Type, “RBE UNALW SLRY OVER CAP 51190" (RBE =Regular Benefits Eligible)
Adjustments can be made via labor distribution.

See major Topic Salary Caps

Create Salary Distribution Adjustment in LD

If vacation or disability sick leave has been taken, has it been properly accounted?

Time-keeping at Stanford is maintained in Axess Time and Leave. For proper accrual and credit of vacation and sick leave, it is essential all employees input all leave into this system. Verify leave by reviewing your Expenditure Detail Report.

Run a Leave Accrual Detail report (PS_TL006) in PeopleSoft.

FinGate Vacation Accrual Page

Commitment Management System

Have the correct fringe benefit rates been applied?

Don’t calculate the rate; just verify the correct rate was used (e.g.: faculty salary, student, etc.).

 

 Doesearch Rate Page

Commitment Management System (CMS)

Has equipment been pre-approved (if necessary) and recorded in Sunflower?

Check your agreement to ensure the equipment is pre-approved (if not, contact the sponsor through OSR/ERA/RMG to obtain approval).

Ensure your Department Property Administrator (DPA) has tagged and entered the property into Sunflower.

Refer to Sponsor notice of award documents

The Cardinal Curriculum, Property Management

Has title been reflected with the proper Expenditure Type and if sales tax is applicable, is it properly charged?

Generally, sales tax must be applied to purchases with title vested to Stanford, but is not applied to purchases where title of equipment or material vests in the federal sponsors. Review transactions to verify sales tax has been applied correctly.

Expenditure Type (Explanation, Definitions & Discussion)

Are you fabricating equipment?
Have fabrication projects been coordinated through the Property Management Office (PMO) and properly documented?

Verify all fabrications have either been created or converted with the appropriate PTA (and that the task is noted “fabrication”). Ensure a fabrication request form is on file.

View the Fabrication procedure for contracts - outlined in the Property Manual

Are travel expenses allowable, allocable, reasonable and consistent?

Review these expenditures for reasonableness, appropriateness and compliance with policy (e.g. pre-approved where necessary, lowest available fares, correct per diems or receipts for reasonable and actual expenses).

Resources & Job Aids: Travel Agencies

Resources & Job Aids: Travel Payment Methods

Administrative Guide Memo 36.7 “Travel”
 

Reports available in ReportMart3:

  • FIN_IOU_265_Reimbursement_ Trans (realtime)

Does the project have a subaward? If so, has the PI reviewed the Subaward’s invoices?

Ensure expenditure types are correct as this affects the IDC calculation (remember, indirect costs are only charged to the first $25,000 of a subaward).

Are all expenses:

  • Allowable

  • Allocable

  • Reasonable

  • Consistent

Subaward Major Topic

Reports available in ReportMart3:

  • FIN_EXP_279_Transaction_Detail (daily)

  • FIN_EXP_148_Purch_Order_Recon
    (realtime)

The Cardinal Curriculum - Subawards

If you manage a subaward you must take ORA-1122, Subawards: Recognizing, Processing, Managing.

Are tuition charges made to the correct PTA and Expenditure Type?

During the first months of the quarter tuition appears as 51960 "Beginning Term Tuition Allowance Prepaid".

At the end of the term they are transferred centrally to 51975 "Tuition Allowance."

Administrative Guide Memo 24.2 “Graduate Student Assistantships”

Salary and Tuition Allowance Tables

Reports available in ReportMart3:

  • FIN_EXP_279_Transaction_Detail (Daily)

Are the F&A rates or the Infrastructure Charge rates correct, and have they been applied to the correct base?

Don’t calculate the rate; just verify the correct rate was used (e.g.: infrastructure, or for sponsored if the work is being performed off campus, was the off campus rate used, etc.)
 

Administrative Guide Memo 37.3 “Infrastructure”

DoResearch Rate Page

Reports available in ReportMart3:

  • FIN_EXP_279_Transaction_Detail
    (Daily)

Have appropriate credits posted, e.g., prior transfers, sales of surplus property, program income?

Review for reasonableness and appropriateness.

Reports available in ReportMart3:

  • ORA_366_SPO_Fund_Statement
    (Daily)

Have the correct PTAs and Expenditure Types been used, or if not, have corrections been initiated?

If expenses are charged to an incorrect PTA or the wrong Expenditure Type was used, correct them via iJournals.

For salary corrections, refer to the "Salary Step".

Cardinal Curriculum References: Policy, Definitions, etc.

Create Salary Distribution Adjustment in LD

Reports available in ReportMart3:

  • FIN_EXP_279_Transaction_Detail
    (Daily)

  • FIN_LABOR_247_Distrib_Adj_Detail
    (Real Time)

  • FIN_JNL_230_Journal_Inquiry
    (Daily)

if cost sharing was committed on a sponsored project, has cost sharing been incurred and charged to the appropriate cost sharing PTA?

Cost sharing requires a new task and award. Contact OSR for a cost sharing task if you don’t see one on your report.

The Cardinal Curriculum, Cost Sharing

Reports available in ReportMart3:

  • FIN_REF_216_Award_Config_Report
    (Real Time)

  • FIN_OSR_179_Exp_Award
    (Daily)

If charges on this PTA have been allocated, is the allocation basis documented?

If costs are charged via allocation journal, has proper authorization been obtained?

Regardless of funding source all expenses must be allocated based on a reasonable allocation method. Sponsored Projects must clearly document allocability.

Cardinal Curriculum: Allocability Discussion

Commitment Management Sysetm

If this award is nearing the “end date”, review:

  • outstanding obligations

  • other actions

Financial closeout should be completed if possible. Remember – even if we can’t perform a financial closeout on a project, we can still submit technical and patent information to the sponsor.

 Closeout

Commitment Management System

Do you expect this PTA will go into overdraft, and if so, are there actions to take?

1. Take care to note if PTA appears to be heading for overdraft – especially if there are missing items and there is little or no funding left.
2. If you know the PTA is in overdraft before the end date, transfer charges as appropriate to a benefiting PTA.
3. After the end date an overdraft must be transferred to a “cost sharing task”.
4. If total overdraft is less than $500, transfer lump sum (net of indirect costs) Expenditure type 56135 to an appropriate unrestricted PTA.

Administrative Guide Memo 34.1 “Activity/Accounts”

Stanford’s policy on handling a potential or actual overdraft

Commitment Management System

Reports available in ReportMart3:

  • FIN_EXP_150_Spo_Funded_Amt_Vs_Act_OD
    (Daily)

Has appropriate documentation been retained (on-line and centrally-filed, or in department files and does it match to the charges?

Confirm that documentation exists and supports charges on expenditure report (including receipts for Purchasing cards.)

Reports available in ReportMart3:

  • FIN_EXP_279_Transaction_Detail
    (Daily)

 

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Quarterly PI Review and Certification

In addition to monthly review, expenditures for sponsored project and cost sharing accounts must be certified by the PI at least quarterly. The following certification statement appears on expenditure statements for every sponsored project and cost-sharing account:

Principal Investigator Quarterly Expenditure Review and Certification:   

The principal investigator confirms: to the best of my knowledge, salary and wages charged to this project are appropriate in relation to work performed on this project. All other costs charged to this project are, to the best of my knowledge, appropriate. Where required, corrections have been or will be made through the accounting system.

Requirement:

The principal investigator reviews and certifies within two months of the end of each academic quarter.

The PI's review and certification of project expenditures is a key piece of documentation supporting the allowability, allocability, and reasonableness of project costs. Particularly for salary charges, this certification is the primary evidence that the salary being charged was supported by a corresponding degree of effort devoted to the project.

 A PI may delegate the monthly review of statements for accuracy, but may not delegate certification of the appropriateness of the charges.

The PIs review and certification assures that all expenses charged to the account are allowable, allocable to the project, and reasonable. The  review and certification of salary expenditures assures that salaries charged to the account are supported by a corresponding expenditure of effort during the time period being certified. The review and certification also assures that other expenditures are for items or services purchased and used during the project period as specified by the award. It is the PI's responsibility to seek a No-Cost Extension of the award if that is necessary in order to complete the project.

To be considered timely, the Quarterly Expenditure Review and Certification Report (RM 149), must be signed within two months of the end of the academic quarter being certified.

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e-Certification

eCertification tracks the results of Stanford's quarterly process of certifying all sponsored project and cost-sharing expenses. This application is for:

  • Verifiers, who track the quarterly certifications and input the status of each PTA
  • Overseers, who coordinate the certification tracking process on behalf of their school or organization

View the Site

 

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Fall Quarter Deadlines (Oct-Nov-Dec)

October

November

 December

January

February

$$$ Oct Statements Available

Oct Review DEADLINE

Dec 31

   

 

$$$

Nov  Statements Available

Nov Review DEADLINE Jan 31

 

 

 

$$$

Dec Statements Available

Dec Review DEADLINE Feb 28

Fall Quarter Expenditures

Fall Quarter PI Certification Deadline Feb-28

 

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Winter Quarter Deadlines (Jan-Feb-Mar)

Jan

Feb

Mar

Apr

May

$$$ Jan Statements Available

Jan Review DEADLINE

Mar 31

   

 

$$$

Feb  Statements Available

Feb Review DEADLINE Apr 31

 

 

 

$$$

Mar Statements Available

Mar Review DEADLINE May 31

Winter Quarter Expenditures

Winter Quarter PI Certification Deadline May-31

 

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Spring Quarter Deadlines (Apr-May-Jun)

Apr

May

 Jun

Jul

Aug

$$$

Apr Statements Available

Apr Review DEADLINE

Jun 30

 

 

 

$$$

May  Statements Available

May Review DEADLINE

Jul 31

 

 

 

$$$

Jun Statements Available

Jun  Review DEADLINE Aug 31

Spring Quarter Expenditures

Spring Quarter PI Certification Deadline Aug-31

 

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Summer Quarter Deadlines (Jul-Aug-Sept)

Jul

Aug

Sep

Oct

Nov

$$$ Jul  Statements Available

Jul  Review DEADLINE

Sep 31

   

 

$$$

Aug  Statements Available

Aug  Review DEADLINE

Oct 31

 

 

 

$$$

Sept  Statements Available

Sept  Review DEADLINE

Nov 30

Summer Quarter Expenditures

Summer Quarter PI Certification Deadline Nov-30

 

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Annual Payroll Distribution Certification

For more information on Annual Payroll Distribution Certification click here.

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