The budget for a sponsored project is the financial expression of the costs necessary to complete a project or program as approved during the award process. After a grant or contract has been awarded, the Principal Investigator (PI) may determine that the approved budget, which is often reduced from those requested during the application phase, is not correctly allocated for the actual needs of the project or program. In such cases, a reallocation of funds from one spending category to another category must occur. This process is called budget revision or rebudgeting. Sponsors may or may not require prior approval for budget revisions, and/or may provide thresholds that require prior approval (either by a percentage of the budget or an amount of deviation by budget category or line item.)
To initiate a reallocation of funds, a PI should work with their Local Research Administrator (LRA) to complete the Budget Revision Form. Once signed by the PI, the LRA should route the form to Central Pre-Award. In instances where a reduction in the amount requested for Facilities and Administration (F&A) costs is greater than $2,500, the Authorized Official at the PI’s School / Center must also sign the request before it is sent to Pre-Award. Please note that for the HNRCA, the Manager for Planning & Analysis must sign all requests in all instances where there is a reduction in F&A
Sometimes budget revisions impact Facilities and Administration (F&A) costs. This occurs when amounts are rebudgeted to or from the following budget categories that do not generate F&A:
If a given budget revision transfers money from a non-F&A bearing budget item (such as equipment) to an F&A bearing item (such as materials), the F&A dollar amount will increase. (See Example 1)
Example 1: An award has a capital equipment budget of $10,000 and an F&A rate of 56%. If only $8,000 was spent on equipment, and the remaining $2,000 will be spent on other materials. The $2,000 balance in equipment will need to be rebudgeted between materials and F&A since the materials purchases will generate F&A. In this scenario, $1,282 would be added to materials and $718 would be added to F&A ($1,282 + $718 = $2,000).
If the budget revision transfers money from an F&A bearing budget item (such as materials) to a non F&A bearing budget item (such as equipment), the F&A dollar amount will decrease. (See Example 2)
Example 2: An award has a capital equipment budget of $10,000 and an F&A rate of 56%. If $12,000 was spent on equipment a budget revision would need to reduce the F&A dollar amount since the additional $2,000 spent on equipment does not generate F&A. In this scenario, the F&A budget would be reduced by $1,120 (56% of $2,000) that would be re allocated to the equipment budget.
Contact Post-Award for assistance with budget revision calculations.
Upon receipt of the Budget Revision Form, Pre-Award will make a determination of whether or not prior sponsor approval is required for the requested changes. Requests for budget revision that do not require prior agency approval will be expeditiously routed to Post-Award for review, internal approval, and processing in PeopleSoft. Post-Award will interact with the LRA to correct any errors in the request.
If it is determined that prior sponsor approval is required, Pre-Award will contact the sponsor on behalf of the PI and obtain such approval prior to routing the request for budget revision to Post-Award. Once the sponsor approval is received, Pre-Award will route the Budget Revision Form together with a copy of any applicable approval from the agency, to Post-Award for review, internal approval, and processing.
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Submit Post-Award documents for processing: firstname.lastname@example.org.