This policy summarizes Principal Investigator (PI) responsibilities outlined by Stanford including quarterly review and certification of salaries, other project costs, cost-shared expenditures, and monitoring of funds within the sponsor's funding limitations and project closeout. Stanford’s policy meets federal requirements.
1. Principal Investigator Responsibilities
The PI has overall responsibility for the technical and fiscal management of a sponsored project. This includes the management of the project within funding limitations, adherence to reporting requirements and assurance that the sponsor will be notified when significant conditions related to project status change. This document addresses specific responsibilities concerned with the financial management of sponsored projects. While responsibility for the day-to-day management of project finances may be delegated to administrative or other staff, accountability for compliance with Stanford policy and sponsor requirements ultimately rests with the PI.
Stanford University requires all Principal Investigators including those receiving University Research awards to review their obligations for stewardship of sponsor funds and compliance with applicable regulations. This can be accomplished by completing DOR 0680, PI Training: Steward and Compliance for Principal Investigators. Individuals can certify their review of this material in the training section of this website.
2. Authorization of Direct Charges
To authorize the expenditure of funds to be charged directly to sponsored projects, the PI and originating department must assure that the:
- estimated charge is reasonable and necessary
- expenditure is allowable by the funding source and, if charged to a federally funded project, by OMB Circulars A-21 and A-110 or the Uniform Guidance
- expenditure provides benefit to the project
- funds are available within the authorized award amount and funding limitations
- justification for the expenditure is documented
- method of allocation of costs is appropriate and documented
- charge is coded with the correct Expenditure Type and charged to the correct account [Project Task Award (PTA)]
- charge has been processed through the appropriate University system
- salaries and wages charged are reasonable in relation to the work performed and to the individual’s total payroll distribution
- payroll charge to each sponsored project account does not exceed the effort devoted to that project
- base salaries may not be increased as a result of replacing Stanford’s salary funds with sponsored project funds
3. Stanford Base Salary
Stanford Base Salary (SBS) is the annual compensation paid by Stanford to individuals whose time is spent on research, teaching and/or other activities.
Stanford Base Salary:
- Includes regular and supplemental salary
- Excludes honorarium, vacation accrual, bonus payments and extra compensation such as faculty housing allowance, tuition reimbursement, etc.
- Excludes any income that an individual is permitted to earn outside of their Stanford responsibilities (e.g., consulting payments)
4. Review of Project Expenditures by the Research Administrator (Task Manager)
Sponsored project and cost sharing accounts must be reviewed by the Research Administrator and the review recorded/verified quarterly in the eCertification system.
- Project expenses displayed in the eCertification system are the basis for cost reimbursements to Stanford.
- Expenditures for sponsored projects and cost sharing accounts should be reviewed monthly by a knowledgeable individual i.e., the PI or designee typically the research administrator (the Task Manager).
- This review is documented quarterly by the research administrator in the eCertification System and is expected to be completed before the quarterly certification by the PI.
- Any questionable charges must be brought promptly to the PI's attention, and, if needed, corrected by an appropriate transfer.
- Transfers should be initiated as soon as possible after a need has been identified. Procedures governing transfers of expense are defined in RPH 15.8: Cost Transfer Policy for Sponsored Projects.
5. Quarterly Review and Certification of Project Expenditures by the Principal Investigator
Sponsored project and cost sharing accounts must be reviewed and certified by the PI quarterly in the eCertification system. It is expected that the Research Administrator review the expenditures before the quarterly certification by the PI.
The following certification statement appears in the eCertification System.
As the principal investigator I confirm to the best of my knowledge that the 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.
The statement will be updated to reflect the COVID-19 pandemic's impact for the period of March 2020 through June 2020.
As the principal investigator I confirm to the best of my knowledge that the salary and wages charged to this project are appropriate in relation to work performed on this project or that the charges are appropriate under the policies of the awarding agency relating to chargeable salaries for those who cannot do work due to the COVID-19 related restrictions. 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.
This certification is the responsibility of the project PI (or Co-PI). A PI may delegate the review of monthly expenditures for accuracy, but may not delegate certification of the appropriateness of the charges except as follows.
- The PI may only delegate review and certification to a participating Academic Council member or PI eligible individual who is responsible for the portion of the statement of work for which they are responsible. The designee must be identified as the Task Owner in the accounting system.
- If the PI of an on-going sponsored project will not be engaged in the project for a period of three months or more, another Academic Council member must be named as Acting PI to assume direction of the project, subject to the approval of the sponsoring agency. The acting PI will assume the responsibility of review and certification of project expenditures. If the acting PI does not have firsthand knowledge of the appropriateness of project expenditures and is unable to certify he/she should contact please contact the Office of the Vice Provost and Dean of Research.
- The purpose of the review and certification is to confirm that all expenses charged to the account are allowable, allocable to the project, and reasonable.
- The certification of salary expenditures confirms that salaries charged to the account are supported by a corresponding expenditure of effort during the time period being certified.
- The certification also assures that other expenditures are for items or services purchased and used during the project period as specified by the award.
- Faculty who are not Principal Investigators and whose salary is charged to sponsored projects must review and certify their payroll distribution.
- Expenditures must be reviewed and certified by the certification due date, which is approximately 75 days after the end of the academic quarter being certified.
6. Record Retention
Adequate explanation and documentation for all project expenditures must be maintained for four years after Stanford closes out the award. Where documentation cannot be provided as to the allowability, allocability and reasonableness of any project expense, including but not limited to expenses incurred late in the project period, the sponsor may deny them. In this case, the PI, department or school will be expected to cover the expense from appropriate sources. All data in the eCertification System will be retained by ORA in accordance with University record retention requirements for sponsored projects (see Guide Memo 3.1.5: Retention of Financial Records.
7. Departure from Policy
Any departure from the policy or procedures regarding Quarterly PI Review and Certification must be approved in advance by the Office of Vice Provost and Dean of Research (DoR) and The Office of Research Administration.
8. Charging Vacation to Projects
Staff at Stanford University, including Academic Staff-Research (non-faculty), accrue vacation as specified by University policy (Administrative Guide memo 2.1.6: Vacations). Stanford and the Office of Naval Research have established Vacation Accrual/Disability Sick Leave rates for exempt and nonexempt/bargaining unit staff. These accrual rates, reviewed and negotiated annually, enable Stanford to charge the appropriate funding source for vacation earned by benefits-eligible staff as they are working.
9. Charging Proposal Expenses to Ongoing Projects
Proposal preparation costs are the costs of preparing proposals on potential Federal and non-Federal projects, including the development of data necessary to support Stanford's proposals. These costs typically include salary for the PI and/or others.
The cost of proposal preparation activities in support of new and competing sponsored proposals cannot be charged to sponsored projects except when explicitly allowed or required by the sponsor (e.g. NIH Mentored Career Development Awards).
The cost of proposal preparation efforts for a non-competing extension or continuing research may be charged to current related projects.
Work performed by faculty, academic staff researchers, instructors and regular staff that is related to current projects may also be related to new projects in development. Only the incremental effort associated with proposal preparation that does not benefit the existing project(s) needs to be identified and charged to an appropriate non-sponsored account.
10. Monitoring of Funds within Sponsor Funding Limitations
PIs are responsible for the ongoing fiscal management of awarded projects, including regular monitoring against project period budgets. Federal grants policy establishes the approved project budget as the financial expression of the project, and sponsors may evaluate the project against the budget at any time. Although sponsors allow certain flexibility with respect to rebudgeting, unobligated balances, and preaward costs, Stanford University and sponsors expect expenditures to be reasonably consistent with the approved project and budget. Sponsors may question or restrict expenditures that appear inconsistent with the project plan and budget. PIs are obligated to request prior approval when budget and program plan revisions indicate a significant change in scope. Indicators of a change in scope can include, for example, significant expenditures beyond the amount authorized on the award, or requests for additional funding.
It is Stanford's expectation that projects will be managed within their established budgets. If, as a result of unusual circumstances or unanticipated project expenses, an account is in overdraft upon expiration of the term of the sponsored project, and if additional funds have not been received from the sponsor, the PI must identify an appropriate source of funds (e.g., gift, endowment, or operating budget) to cover the expense. The overdraft must be transferred to a cost sharing award in sufficient time to permit Stanford to comply with the financial reporting requirements of the original award (See Project Closeout, below).
The department must identify the source of funds to the Office of Sponsored Research or designated School office, which will create a cost sharing account. The department will then initiate the necessary expense transfer, including documentation of the nature of the expenses, noting they were legitimate project expenses but the funding was inadequate, and other reasons for the transfer. Such transfers must occur in sufficient time to permit Stanford to comply with the financial reporting requirements of Closeout, and the RPH: Cost Transfer Policy for Sponsored Projects.
The PI, department or school is responsible for the timely clearance of any unfunded expenditures from within its resources.
12. No Cost Time Extensions
If additional time is needed to complete a project and there is an unexpended balance in the award, PIs may request that the period of performance of an award be extended. In some cases, Stanford officials are authorized to approve no cost time extensions; in other cases, agency prior approval is required. Requests for extensions should be initiated by a PI and processed in accordance with the terms of the sponsored award; in most cases, the countersignature of an authorized institutional officer is required. To ensure compliance with the reporting requirements of awards, PIs are urged to submit no-cost time extension requests as soon as the need becomes apparent. Requests for a no cost time extension should be submitted no later than the end date of the award (unless an earlier date is required by the agency.) Award closeouts cannot be delayed to accommodate pending requests submitted after the award end date.
If final technical reports are to be completed after the project end date, and funds from the project are available to pay these expenses, a no cost extension should be obtained from the sponsor to cover the expense of producing and distributing those reports. If funds are not available from the project, then the PI, department or school must identify unrestricted funds to pay final report costs.
13. Project Closeout
PIs are responsible for overseeing the proper closeout of sponsored projects, including the timely submission of all required reports (including final technical reports). While central offices prepare and submit final administrative reports, including financial and property reports, they do so on the basis of documentation created in the department. PIs must assure that such documentation is adequate and readily available. In addition, PIs are responsible for ensuring that any necessary final financial adjustments and documentation (e.g., final invoices from vendors or subrecipients) are received promptly after the end of the award.
If an approval to close an award has not already been provided by the PI, the Office of Sponsored Research will prepare and submit financial reports based on the information reflected in the financial system. In addition, some financial reports may require the PI's signature.