Guideline RAG05 FIXED PRICE AGREEMENTS - RESIDUAL BALANCE

Contents:

  • Purpose
  • Policy Guidelines

  • PURPOSE:

    Fixed price agreements are expected to be based on the best estimate of the funds needed to complete a project. In some cases, a small residual balance may remain at the end of the project.

    POLICY GUIDELINES:

    At the time the fund is to be closed, the academic unit may retain that portion of the balance representing the unused direct costs; however, the indirect portion must be transferred to the central indirect cost income account. The amount of the residual balance shall not exceed twenty percent (20%) of the award. This is accomplished by the preparation of a Journal Voucher - Departmental (JVDP), debiting income on the account to be closed, and crediting income in the unit's Miscellaneous General Research Account for the direct expense portion and 001-69 (1001), Object Code 040, for the indirect portion

    Accounts should be closed within a reasonable period after the termination date, but no later than six months after the termination date (or approved extensions).

    All costs related to a project must be charged to the account at the time the cost is incurred. It is inappropriate for investigators to utilize general funds to support the project in an attempt to generate a residual balance in the restricted account at the end of a project.

    Detailed information may be found at:  http://www.research.psu.edu.


    Effective Date: January 9, 2012
    Date Approved: January 5, 2012
    Date Published: January 9, 2012

    Most recent changes:

    Revision History (and effective dates):

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