Annual Expenditure Validation
In the course of managing a sponsored project, expenses must be regularly reviewed for compliance and to ensure they are accurate, reasonable, allowable and appropriately allocated to the project. Each project must undergo a quarterly financial review, an annual expenditure validation, and a final expenditure validation.
On the anniversary of a sponsored project’s start date, an annual expenditure validation request will be sent from Sponsored Projects Finance (SPF) to the DA(s) and PI(s) of the project, indicating the due date for the validation.
Upon receipt of an annual expenditure validation request from SPF, a thorough review of the project’s expenditures must be conducted. Validation may be provided by the DA alone if the DA regularly reviews the project expenditures and thus has a basis on which to confirm appropriateness, otherwise, PI validation is needed.
A thorough review includes:
- Review of budget and all direct and indirect costs
- Analysis of outbound sub-awards to ensure that all invoices for the year have been received, reviewed, and paid
- Submission of pending cost transfer requests and review of anticipated integrating systems distributions
- Review of petty cash, travel advances, open encumbrances and PO’s
- Review of overrun, when one exists
- Review of receivables to ensure expected payments have been received and applied
- Preparation and submission of progress reports, technical reports, and invention statements, when required
Once the validation is complete, an attestation must be sent to SPF indicating that:
- Expenses for the year have been finalized and posted in ARC
- Expenses charged to the project were incurred in support of the project and comply with all applicable terms and conditions
Annual validations are due either 40, 60, or 90 days after a project’s anniversary, depending on the sponsor and award type:
- 90 days: NIH and NSF grants and cooperative agreements
- 60 days: all other prime awards
- 40 days: all inbound subawards