Office of Sponsored Programs (OSP): Project Balance Netting and Fixed-Price Balances | November 2017 CRU Newsletter

By Holly Tiemann

OSP has announced updates to Duke’s post-award financial management processes, which were implemented in October.  Reach out to your OSP liaison and/or implementation team representative with any questions.

Project Balance Netting

All reportable sponsored projects that include subcodes established under a parent code with an end date of October 1st or later will follow a standardized approach when expenses do not equal budget on all WBSEs.  These procedures will ensure consistent predictable management of balances across all parent w/subs projects, will support the ownership of the project by the parent org, and will minimize financial risk to Duke University. 

Factors that will affect the specific steps of this approach include:

  • Whether a project is at budget period end (carryforward not automatic) or project period end
  • Purpose (rebudget class) of each subcode

A detailed description of this process is available in a Quick Reference Guide (QRG), addressing both the standard procedures and exceptional circumstances. 

There is no change to the institutional expectations for GMs to monitor balances during the life of the project, to submit rebudget request forms as appropriate to align budget with PI intent, and to communicate on critical issues with GMs of subcodes managed in other org units.  In all cases when closing a project that includes subcodes, the owning org of the parent retains control of the ultimate disposition of budget and expenses across all project codes; read the QRG closely to determine the correct approach based on the specific factors on each WBSE.  The Parent/Child Sponsored Project Management GAP 200.190 has been updated to confirm the project balance netting process at time of closeout.

Fixed-Price Residual Balances

All fixed-price reportable sponsored projects closing with an end date of October 1st or later will be processed based on the new Fixed-Price Residual Balance Transfer GAP 200.185.  These standard procedures are being implemented by Duke University to provide a consistent approach to the review and disposition of residual balances on projects based on a fixed-price award amount, and to ensure appropriate management review and risk analysis are performed based on the details of each project. 

Key points include:

  • There is a minimum award amount threshold (projects with a total award amount of <$20,000 are exempt from the GAP)
  • There is a tiered review structure based on the amount of the residual balance;
    • Balances of ≥25% total award amount or ≥$50,000 will require owning org management review
    • Balances ≥40% or ≥$100,000 require School approval
  • F&A will be assessed on the residual balance, based on the original proposal budget and assigned F&A rate, and the direct cost portion of the balance will be transferred to the cost object identified on the closeout tasklist.

There will be an associated Quick Reference Guide that provides a helpful graphical summary of this process and links to related resources; it will shortly be posted here. 

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