UCI receives a variety of agreements (including fixed-price awards), from a broad spectrum of sponsors to fund its research enterprise. A fixed-price award, which is usually a contract but may also be a grant or other funding mechanism, is characterized by its unique nature. A sponsor agrees to pay UCI a predetermined price for accomplishing the agreed upon work, regardless of the actual cost to complete the work and provide the final deliverable(s).
Occasionally, UCI completes the work at a total cost that is less than the agreed upon price. In such cases, the account assigned to the fixed-price award will have an unexpended balance. UCI's procedure for the treatment of such unexpended balances is described below.
When an account for a fixed-price award has an unexpended balance, UCI makes the remaining balance attributable to budgeted direct costs available to the Principal Investigator (PI) by transferring it to an unrestricted sales and service fund, 60118, linked to a department research account (UC Account starting with 41xxxx). The PI may use the funds to further support their research program, including support of graduate students engaged in research.
All of the below criteria must be met for the direct cost portion of the fixed-price award unexpended balance to be eligible for transfer to an unrestricted department research account:
- All work required under the award must be completed and all required programmatic and administrative deliverables sent to the sponsor.
- The PI must certify that all expenses charged to the award were consistent with UC/UCI policy, and award terms and conditions. Specifically, all expenses to carry out the work were appropriately incurred, timely recorded to the correct account, reconciled in a timely fashion, and reasonable (meaning that a prudent person would come to the same decision regarding the price paid and the funding source charged under the same circumstances and involving the same facts).
- Financial closeout must be completed, and this is accomplished jointly by the administering unit and the Contracts and Grants Accounting Office.
Within 90 to 120 days after the expiration of a fixed-price award, the department/unit administering the award completes the Fixed-Price Award Closeout Form and e-mails it to the appropriate accountant in the Contracts and Grants Accounting (CGA) Office.
The form must be signed by the PI for the purpose of making the above noted certification, and the administering department/unit must provide a KFS account with attributes of a department research UC account number (41xxxx) linked to an appropriate fund number (60118). In cases where the total unexpended balance is greater than $10,000 or greater than 25% of the total amount received from the sponsor, the PI must include a written explanation for the balance.
If a fixed-price award has more than one PI (e.g. a lead PI and multiple Co-PIs), it is the responsibility of the PIs to determine how the unexpended balance will be distributed amongst them. In addition, it is the responsibility of the administering department/unit to communicate to the CGA Office the research account numbers and the amount to be transferred to each.
After the CGA Office has verified that the unexpended balance is eligible for transfer, it will distribute the total unexpended balance between direct costs to the PI and facilities and administrative (F&A) costs to the campus using the F&A cost rate applicable to the award. For example, if $9,000 remains and the applicable F&A rate is 57%, $5,732.48 will be distributed to direct costs and $3,267.52 to F&A costs. The CGA Office will transfer the direct cost balance to the department research account provided by the administering department/unit.