Cost Transfers

Last updated: 02/14/2020 - 9:50am

About Cost Transfers

A cost transfer is defined as an after-the-fact re-allocation of a cost (expenditure) from one ASU account to another. These transfers sometimes move costs from or to a sponsored project account, and are thus monitored by Research Operations. Research Operations monitors sponsored cost transfers pertaining to the salaries of faculty and staff working on a sponsored project as well as supplies, equipment, travel, and other expenses.
Type of Expense Cost Transfer Method
Salary and Wage corrections for FY19 payroll and beyond Payroll Redistribution application in PeopleSoft
Salary and Wage corrections for FY18 payroll  Accounting Journal in Workday (refer to full instructions here).
Non-Payroll Cost Transfers for FY18 Accounting Journal in Workday with Non-Payroll Cost Transfer Request (CTR) ORSPA 510 form.
Non-Payroll Cost Transfers for FY19 and Beyond Accounting Adjustment, Accounting Journal or Enterprise Interface Builder in Workday with Non-Payroll Cost Transfer Request (CTR) ORSPA 510 form.

Faculty and staff must make every effort to allocate sponsored project costs to the appropriate account(s) at the time the costs are initially incurred. However, sometimes it is necessary to transfer costs from one account to another.

Cost transfers involving sponsored projects are allowable only in special circumstances, including:

  • Error correction
  • Transfers between sub-allocations of the same sponsored project
  • Costs benefiting more than one project
  • Clearing potential or actual overruns
  • Disallowed costs

Any time a transfer is initiated, you invite the assumption that the transaction was not initially handled properly. If expenses are being transferred onto a sponsored project account there will be considerable scrutiny of the reasons for the transfer, and the justification for moving those charges. To adequately support these transfer requests, it is essential to provide justifications explaining how the cost directly benefits the project account being charged.

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Issues Related to Cost Transfers

The situations detailed below are often encountered in the administration of sponsored projects. The proper treatment of these situations may avoid the need for cost transfers. Research Advancement (RA) staff or the assigned Award Management Team (AMT) Grant and Contract Officer (GCO) can provide guidance and assistance when these issues arise.

  1. Pre-award at-risk. For the effective and economical conduct of a sponsored project it is sometimes necessary for costs to be incurred prior to receipt of the award document and actual funding. In such cases, units should request the establishment of an at-risk account. Complete and submit the At-Risk Request Form in ERA following the instructions included in the form. The early account number will become the permanent account number when the award is effective and no cost transfers will be required. If the anticipated funding is not received, these costs will need to be covered as an institutional expense by the account provided to guarantee the costs.

  2. Continuation Costs. If a continuation award is anticipated after the end date of the original contract or current contract modification, costs may continue to be charged to the current active account following the processing of a Post-Award At-Risk. To request a Post-Award At-Risk units need to submit an Award Change Request in ERA. If the continuation award is denied, these costs must then be covered as an institutional expense by the account provided to guarantee the costs.

  3. Cost Accounting Standards. Special care should be taken to ensure that any cost typically considered a facilities and administrative cost (F&A) is not initially charged or transferred to a sponsored project as a direct project cost unless it meets the Cost Accounting Standards (CAS) exception and is properly documented. See RSP 508-01. Units are no longer required to obtain Research Operations' approval but are required to maintain a justification and associated backup documents.

  4. Close-out of Sponsored Project Account. Principal investigators and unit administrators overseeing sponsored project accounts should be particularly careful to manage and monitor account expenses to avoid incurring costs that are not reimbursable. Principal investigators and unit administrators should check the award terns and conditions.  If there is uncertainty about the allowability of an expense, the unit should contact the assigned AMT GCO prior to charging the sponsored account. If unallowable costs have been incurred, they must be removed from the sponsored account and charged to an appropriate unit account. Generally, costs incurred beyond the project end date are not allowable.

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Non-Payroll Cost Transfers - Other Considerations

The standard expectation is that the PDF packet should stand on its own and that the justifications are clear enough to allow for review and approval. The unit/Financial Services, as appropriate, are required to retain the support documentation for the original expense in the event of an audit.
 

Justifications:

Justifications must be clear and concise. A descriptive phrase or two can suffice if it adequately answers the questions. Some examples of weak/poor justifications are:

  • I am moving this charge to place it on the correct account

  • There is no error
     

Determining the 90-day window:

  • The standard 90-day window is calculated by counting 90 days from the Workday Financial Close of the month in which the expense posted.
  • Requests for cost transfers have to be received by the assigned AMT GCO within the 90-day window, allowing for corrections as needed.

 

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Cost Transfer Policies

Please note that RSP 506-02 disallows cost transfers which occurred more than 90 days prior, or a shorter timeframe in the case of closeouts and final invoicing of terminated projects.

RSP Policies

RSP 506-02, Cost Transfers on Sponsored Projects
RSP 508-01, Charging Direct and Facilities & Administrative Costs to Sponsored Projects

Federal Regulations

2 CFR Part 200 (Uniform Guidance), Subpart E - Cost Principles

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Cost Transfer Training

Payroll Redistributions

Training is required prior to being granted the FSO Redistribution role in PeopleSoft.

Courses are offered by Financial Services personnel. Go to the ASU Course Catalog Search page. Search for courses titled "Payroll Redistribution" and then click on the "Search" button.

Courses may also be found by going to the ASU Course Catalog Search page, select "ASU Business Operations" and then click on the "Search" button. On the next page, look for courses titled "Payroll Redistribution".

Additional Resources:

Non-payroll Cost Transfers

FMS Work Instructions

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Payroll Cost Transfers

A payroll redistribution is used to correct an inaccuracy in payroll accounting. These are also known as cost transfers (specific to payroll).

Payroll redistributions may be used to correct the account number, position number, close date or earnings code type of a payroll expense.  Payroll Redistributions are often the result of monthly account reconciliations.

Payroll redistributions follow the 90-day rule noted in item 5. What is the 90-day policy and is it enforced? Under Cost Transfer FAQs below.  Note that 90-day exceptions are rarely being granted due to the higher audit risk, and they indicate monthly payroll reconciliations are not being completed in accordance with ASU FIN 201.

Answering the three questions/response requests.

PeopleSoft requires that an answer for each question/response request be entered.  The answer of “not applicable” or “none” is not acceptable when the transaction involves sponsored projects.  Input of “N/A” or “none” will result in the transaction being returned for editing.

Relevant and detailed information will aid in making the approval and entry process quicker and more accurate.  It is very important to give pertinent and comprehensive answers so as to provide a proper audit trail.  On sponsored projects, federal and other sponsor regulations require written justification on all payroll redistributions that will document:

  1. Reason why payroll expenses are being transferred. Explain how or why the error occurred.  (Note: The question is not why the unit wants to transfer the payroll expense.  All payroll redistributions are considered errors.)

  2. What corrective action will be taken to avoid this type of error in the future?  (Note: since all payroll redistributions are considered errors, there is some kind of corrective action that can be taken going forward.)

  3. This one has two parts: (1) Describe why all costs transferred are allowable, allocable, and reasonable charges. (2) Additionally if a sponsored account, describe the tasks performed that were appropriate and necessary to the performance of the sponsored project.  (Describe one or two specific tasks performed by the employee for the project during the payroll redistribution period, not a list of tasks mentioned in the SOW.)

Answers to the second and third questions/response requests are not required if payroll is being transferred off an account.

Note that the text boxes are limited to 254 characters.  Explanations that merely state that the transfer was made “to correct an error” or “to transfer to correct project” are not sufficient to justify new charges on a sponsored project account. Transfers from one sponsored project to another sponsored project to reduce cost overruns, to spend unused balances, to avoid restrictions imposed by law or agreement terms, or for other reasons of convenience are strictly prohibited. Please do not use the same response for all three questions/responses as this will result in the payroll redistribution being returned for editing. The responses should be relevant to the specific employee and the question/response request to which you are responding.

Additional information regarding payroll redistributions is available in the Cost Transfer FAQs below and Best Practices for Payroll Redistributions on Sponsored Projects.

Cost Transfer FAQs

1. What is the difference between an Accounting Adjustment and an Accounting Journal?

An Accounting Adjustment allows users to update the Accounting Worktags associated with a particular transaction. For grants, an Accounting Adjustment is the preferred method to transfer non-payroll expenses as it retains all the historical journal information of the original transaction. Accounting Adjustments can only be used when transferring the full transaction amount of Supplier Invoices, Supplier Invoice Adjustments and Expense reports for FY19 and beyond.

An Accounting Journal can be used to transfer multiple accounting items from/to multiple accounts.  It is a more versatile document that can transfer partial dollar amounts, multiple expenditures on multiple accounts to multiple spend categories on multiple accounts. Units should keep in mind that Accounting Journals do not provide an audit trail and should only be used when necessary (i.e. for FY18 expenses).

2. How often should payroll be reconciled to determine if redistributions are needed?

Per policy FIN 201, account reconciliation is expected to take place on a monthly basis to ensure timely correction of any accounting mistakes.

3. How should payroll expenses be reconciled?

Payroll reconciliations should be started prior to each pay day with the timely review of the On-Cycle Payroll Register Dashboard and completed immediately following each pay day.  ASU Analytics contains Payroll Reconciliation Reports to assist in the reconciliation process.  The Grants Salary, ERE, and Tuition Expenses Reconciliation Report is now available in Workday.  Expenses may also be reviewed and verified by running the HR Expenditures Workday query in MyReports.  These reports should be accessed on a monthly basis to determine that pay amounts and accounting sources are correct for the unit's employees. Any corrections (payroll redistributions) must be made in a timely fashion.  Helpful information about payroll reconciliations can be found in the Financial Services – Best Practices-Reconciling Payroll Expense document.

In the Human Resource folder in MyReports, there are two canned query options called HR Expenditures Workday or HR Expenditures Advantage.  Both queries offer three query options:

  • Salaries, Wages, and ERE– (this query will provide a listing of payroll and employee related expenses for a specific account)
  • Salaries and Wages – (this query will provide a listing of payroll expenses for a specified account)
  • ERE/Tuition Remission – (this query will provide a listing of employee related expenses for a specified account)

 

 

Information on using MyReports is at http://www.asu.edu/it/eds/welcome.html.

4. What is the 90-day policy and is it enforced?

Cost transfers related to either salary, wages and related ERE, or non-payroll expenses, when involving sponsored project accounts, must comply with ASU’s Cost Transfers on Sponsored Projects policy found in RSP 506-02.  This policy states that transferring costs onto a sponsored project must be requested within 90 days after the month in which the cost was originally accepted in the university’s financial accounting system. No time limit exists for removing inappropriate expenditures from a sponsored account. If an inappropriate expenditure is discovered on a sponsored project it must be removed regardless of a time limit. The 90-day policy does not apply to transfers between grants under the same award.

A shorter cost transfer request period is necessary near the project end date. Final financial reports are typically due to sponsors 30 to 90 days after the project end date. This requires that all cost transfers must be completed no later than 60 days after the project terminates (unless the final financial report is due in less than 90 days following project termination requiring an earlier fiscal closeout of the project). This earlier cutoff is necessary to promptly charge the project and not delay submission of the financial report. Transfer requests on terminated projects may not be approved and will be reviewed by Research Operations on a case-by-case basis.

The assigned AMT GCO will be able to answer questions relating to a project end date and/or final invoice/report submission required by the project.

5. How is access gained to enter payroll redistributions online in PeopleSoft?

Payroll redistributions are expected to be handled by each unit, and are to be entered in our payroll system of record, PeopleSoft.

Training is required to be granted the ASU_HR_PM Redistribution role in PeopleSoft, also known as the FSO Redistribution role. Courses are offered by Financial Services personnel. Register  is through the ASU Course Catalog Search page. Search for courses titled "Payroll Redistribution" and then click on the "Search" button.

6.  Does the submitter of the payroll redistribution need to have the PeopleSoft HR Grant Manager Role?

No. However, PeopleSoft HR Grant Manager approval is required when payroll moves on to a sponsored account. If the person who submits the payroll redistribution is not a PeopleSoft HR Grant Manager on the account the charge is being transferred to, then all PeopleSoft HR Grant Managers on the account will be notified via email that the transaction requires approval. Only one PeopleSoft HR Grant Manager approval is required to process the payroll redistribution. An employee is not permitted to submit and approve their own payroll redistribution. An additional submitter or PeopleSoft HR Grant Manager is required in this case.

7. What needs to be checked before submitting a transaction?

If transferring on to a sponsored project, make sure:

  • The project is still open and the sponsor has not received the final invoice. The assigned AMT GCO can advise the status of the final billing, if need be.
  • The account is not in deficit and there is available budget for the transactions moving onto the account. If additional funding is expected but the award notice has not yet arrived, please consider an At-risk increase using a guarantee account.
  • There is confirmation that the person performed work on the project. This information must be included in the justifications.

8. How is a payroll redistribution done in PeopleSoft?

Payroll redistributions for FY19 and beyond should be submitted through PeopleSoft which can be accessed through MyASU.

  • Log on to MyASU at www.asu.edu/myasu
  • Locate and click on the PeopleSoft quick link. This will open a new window to the PeopleSoft logon screen.
  • Logon to PeopleSoft HRIS and follow this menu navigation:
    • ASU Customizations
    • ASU HCM Custom
    • ASU Position Management
    • Create Redistribution Entry

Input your search criteria (Fiscal Year, Empl ID, ASU Acct, etc…) and click 'Search' to pull up the transaction to be redistributed.

9. What are the steps to completing the payroll redistribution in PeopleSoft?

  • Once a transaction to redistribute is selected, a data entry screen for the “From” side of the transaction will appear:
    • Enter answers to ALL of the three questions.
      • Not applicable, N/A, and none are not appropriate answers.
      • It is very important to provide pertinent and comprehensive answers as to provide a proper audit trail.
      • Relevant and detailed information will aid in making the approval and entry process quicker and accurate.
    • Enter the dollar amount to be transferred.
      • It is not necessary to transfer the entire transaction amount.
      • The amount entered can be equal to or less than the original transaction.
    • Click the Continue button to move to the next screen.
  • Enter information for the “To” side of the transaction.
    • Input boxes are provided with defaults which mirror the original transaction. Any of the following  may be changed: Position, Earn Code, Close Date, and Account.
    • Input the dollar amount for this transaction in the Redist Amt box.
    • If redistributing to more than one set of codes, click the plus sign at the right-hand side of the line to add a line.
    • Click save when all of the “To” criteria are entered. The Redist amount must net zero before the transaction can be submitted. For instance, if redistributing $500, your offsetting entries must equal -$500.

10. What transpires between submission and General Ledger posting?

For transactions transferring on to a sponsored account, the transaction requires PeopleSoft HR Grant Manager approval. If the submitter is a PeopleSoft HR Grant Manager, the transaction skips to Research Operations approval. If the submitter is not the a PeopleSoft HR Grant Manager, the transaction will queue for PeopleSoft HR Grant Manager Approval, and all HR Grant Managers will be emailed. Only one PeopleSoft Grant Manager is required to approve.

Next Research Operations reviews the transaction. Research Operations may return the transaction if the answers to the questions require more detail. Also, if an account is closed or in deficit, there is potential the transaction can be canceled and the unit notified.

Once the transaction is Research Operations approved, payroll redistributions post to Workday daily, except on Fridays due to Workday maintenance. 

11. Where can I find PeopleSoft HR Grant Managers for a specific grant account?

1. Log into Workday using your ASURITE and password (DUO authentication required).

2. In the search box enter the Grant Account Worktag (GRXXXXX) and hit enter:

3. From the search results, click on the Grant link:

4. Click on the Roles tab located at the top of the screen:

12. How long does the process take overall?

The process is usually completed within 5-7 business days. This is dependent upon several factors, however, having the form properly completed, submitted timely, with appropriate signatures can help expedite the process. There have been instances where PRRs have taken months to approve because they were in the Signer’s queue, and the signer didn’t regularly check his/her queue for requests. This can result in PRRs being over the 90-day threshold and thus disallowed. At fiscal year-end, there is more activity and approvals may take longer than usual.

13. Is there a way to tell when a transaction has been approved by Research Operations and posted to Workday?

Once a payroll redistribution has been processed, the approval status can be viewed in PeopleSoft under ASU Position Management/View Redistribution Entries. In the transaction header are Approval Status, Signer approval, Research Operations approval, and GL post dates. A blank date field indicates that an action has not yet occurred. Approval status of “All Approved” indicates the transaction has passed signer and Research Operations' approvals, and a GL post date indicates the transaction has been loaded to Workday.

14. How can a transaction that has been rejected be edited?

Once a transaction has been submitted, the only information that can be edited are the responses to the three questions. If the accounting information needs to be changed, withdraw the submitted transaction(s) and resubmit new transaction(s).

To edit responses to the questions:

  1. Use the “Edit/Resubmit Redist Trans” in ASU Position Management to search the transaction.

  2. Edit the responses. Relevant and detailed information will aid in making the approval and entry process quicker and more accurate.  It is very important to give pertinent and comprehensive answers in order to provide a proper audit trail.  Only the responses to the 3 questions/response requests can be modified.  Additional text can only be modified if it is part of the original request.  Additional text cannot be added to a returned request.  It is usually possible to provide proper justifications using complete sentences in 254 characters or less.

  3. Submit the transaction again.

15. How do I withdraw a transaction I have submitted?

Provided the transaction has not been Research Operations' approved, you are able to withdraw your transaction as follows:

In PeopleSoft, navigate to the ASU Customizations>ASU HCM Custom>ASU Position Management>Edit/resubmit Redist Trans. Call up the transaction and click the Withdraw button at the bottom of the screen.

16. Where can Payroll Redistributions be viewed?

Anyone with MyReports HR access can query payroll data for redistributions. In MyReports, redistributions are indicated by Source code of “RD”, and there is a column listing the transaction number. All transactions in MyReports have been posted to the GL.

In PeopleSoft, those with the FSO Redistribution, HCM Dept Financial Mgr, HCM Dept Position Mgr, and HCM Position view roles can see the screen View Redistribution Entries under the navigation: ASU Customizations>ASU HCM Custom>ASU Position Management>View Redistribution Entries. View Redistribution Entries allows viewing of positions within your PeopleSoft unit access. Also, entries that have not posted to the GL yet are pending can be viewed. Only transactions with a date listed in GL Post Date have been fully processed.

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Contacts

COST TRANSFERS (FROM OR TO A SPONSORED PROJECT ACCOUNT)

Payroll Redistribution Request

Questions on requesting a payroll cost transfer such as allowability on a project and proper justification may be directed to the unit's RA staff, or to the assigned AMT GCO. Contacts for the unit can be found by using Who Can Help Me?.

Payroll Redistribution Helpline

(480) 727-2584

Payroll Redistribution Mailbox

PayrollRD-q@asu.edu

PeopleSoft-Payroll Redistribution System Assistance

UTO CRM (Customer Relationship Management). Submit case at: https://uto.asu.edu

NON-PAYROLL COST TRANSFERS

Non-Payroll Cost Transfer Request and Status in Workday

Questions on requesting a non-payroll cost transfer such as allowability on a project and proper justification may be directed to the unit's RA staff, or to the assigned AMT GCO. Contacts can be found by using Who Can Help Me?.

Non-Payroll Cost Transfers are fully processed in Workday. Units can monitor the progress of a cost transfer from the Process History section of the Accounting Adjustment Event or Accounting Journal.

FMS Assistance

Service Now FMS Support
Phone: (480) 965-2334

 

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