Financial Management

1. The factors that affect the allowability of costs on a sponsored project can be found in OMB Circulars A-21 and A-110.

True

False

2. Which of the following best describes the factors affecting the allowability of a cost on a sponsored project?

The cost must be reasonable, allocable, treated consistently, and must conform to any limitations identified in OMB Circular A-21.

The cost must be reasonable, allocable, treated consistently, and must conform to any limitations identified in OMB Circular A-21 or the sponsored agreement.

The cost must be reasonable, allocable, treated consistently, and must conform to any limitations identified in OMB Circular A-21 or the sponsored agreement and OMB Circular A-110.

3. What best describes the purpose of OMB Circular A-110?

OMB Circular A-110 outlines for federal agencies the rules for the management of grants and contracts.

OMB Circular A-110 outlines for federal agencies the rules for the management of grants and cooperative agreements.

OMB Circular A-110 outlines for federal agencies the rules for the management of grants, contracts, and cooperative agreements.

4. If an award has a cost-sharing requirement, the PI and department administrator must track each expense considered as cost-sharing by applying which of the following:

Institution policies regarding the allowability, allocability and reasonableness of the expense.

Institution policies and sponsor terms and conditions regarding the allowability, allocability, and reasonableness of the expense.

Sponsor terms and conditions only regarding the allowability, allocability, and reasonableness of the expense.

5. Salary charged to a sponsored project at a minimum should reflect the effort devoted to that project as committed in the award. What should be done, if the effort devoted does not agree with the salary charged on the certification report?

Nothing needs to be done since salary charges are based on estimated levels of effort.

The PI or other person having a suitable means of verification is required to ensure the accuracy of an effort report and to amend the effort report which may ultimately require a cost transfer to be done.

As part of a department administrator's responsibilities s/he must determine the accuracy of an effort report and complete all transfers prior to presenting an effort report to the PI for signature.

6. Which of the following would be an acceptable reason for initiating a cost transfer?

The PI is running out of money on a federal project and wants to transfer the cost to another federal project because the latter has funds to cover the costs.

The PI and department administrator have found it convenient to “park” all the PI's research costs temporarily in a single project and then transfer them to the correct projects later.

An expense was incorrectly charged to a project and, upon discovering the error thirty days later, a cost transfer to the appropriate project is initiated.