Closeout Procedure

This page describes the procedure to prepare a final invoice and/or financial report for awards extramurally sponsored by government, non-profit, and for profit entities, for organized research, instruction and training, and other sponsored activities (e.g. public service, community service, health service projects, etc.) at UCLA.

Prior to Fund Expiration

• As indicated in UCLA’s Policy 910: Management of Sponsored Projects, Departments are to conduct monthly reconciliation with the general ledger. This includes, reviewing and approving all expenses to charge in compliance with the award terms and conditions, providing the PI with accurate and timely information about expenditures and processing adjustments needed to ensure that the general ledger is cleared of any expenses not applicable to the Sponsored Project.
• ORA sends three notifications to alert Principal Investigators and department fund managers as follows;
  
  • On 90 days prior to fund expiration
  • On 30 days prior to fund expiration
  • On the day of expiration
• The notification includes the fund expiration date, the current balance, EFM contact as well as key demographic information of the award including PI name, project title, sponsor award number and etc. Templates of automatic notifications can be located at the Standard Forms and Other Resources page.
• Upon receipt of the notification 90 days prior to the fund expiration, all campus departments (including organized research units) start actively preparing to close out the fund to submit the closeout packet, including any supplemental schedules and supporting documentation as applicable. To ensure appropriate and complete review, “Department checklist at 90 days prior to fund expiration” can be used as a guideline. The checklist can be located at the Standard Forms and Other Resources page.

After Fund Expiration

• ORA sends closeout packet (COP) reminders 15 calendar days prior to the COP deadline (COP reminders may be sent prior to the fund expiration depending on the due date of the final to the sponsor).
• Departments prepare and submit the COP to EFM by the deadline. Closeout packets are due to EFM in advance of the sponsor due date. To assist in determining the deadline depending on Sponsor’s due date, refer to the Due Dates table in the Closeout Deadlines page.
• EFM reviews the closeout packets submitted by department fund manager and may make further inquiries when clarification is needed.
• For federally sponsored projects, when the submitted COP is materially incomplete or inaccurate, EFM prepares the Final based on expenses posted to the project fund excluding unallowable, inapplicable, and undocumented questionable costs. EFM records expense accruals to the project fund for the expense adjustments included in the Final.
• When the COP is not submitted to EFM by the deadline or required information is not provided timely, EFM will proceed to prepare the final invoice or financial report based on expenses posted to the general ledger excluding questionable costs. EFM will provide these figures to the department and request confirmation of final expenditures, refer to the Due Dates table in the Closeout Deadlines page.
  The financial closeout procedures can be located at the Policies and Procedures page.

After Submission of the Final Invoice and/or financial report to Sponsors

• EFM provides Principal Investigators and department fund managers with a copy of the final invoice and/or financial report submitted to the sponsor.
• Copies of the final invoice and/or financial report submitted to the sponsor are retained in PAMS.
• Departments maintain appropriate and sufficient supporting documentation for all transactions posted to the funds as the office of records. In the event of audit, departments provide EFM with requested documents to support any questioned transactions and are responsible for the expenses that are concluded unallowable and/or inapplicable by the auditor.
• For federally sponsored projects, EFM reverses expense accruals for pending adjustments as they post to the project fund. Departments should notify EFM as soon as they become aware of such occurrences.
• Departments review expired funds and take required actions to ensure expenditures are reconciled to close the fund. This includes, but is not limited to, processing cost transfers, cancelling recharge IDs, clearing encumbrances and memo liens.

Clearing Deficits

Definition

A deficit occurs when cumulative expenditures exceed total revenue.
A cost overrun (a.k.a. overdraft) occurs when actual expenditures exceed the budget approved by the sponsor.

When the final invoice and/or financial report is completed,

• EFM excludes unallowable expenses and/or inapplicable expenses that are charged to the sponsored fund from preparing the final financial deliverable to the sponsor.
• EFM reduces the award budget to the final expenses reflected in the final financial deliverable. When there is a cost overrun (overdraft), EFM processes a financial journal to remove the overdraft to a departmental unrestricted funding source designated in the closeout packet. In the event an unrestricted funding source is not provided by the department, EFM uses the default FAU that is being utilized for UCPath.
• EFM distributes a monthly deficit report to Department Administrators designated in PAMS. This report identifies sponsored funds that expired over 6 months ago that reflect a deficit balance. Departments should utilize this report to take timely action to clear the deficit from the funds.
• Within 30 calendar days from the due date of the financial deliverable, the Department removes unallowable and/or inapplicable expenses not included in the Final, and releases encumbrances and memo-liens from the fund.
• EFM removes the cost overrun from the project fund utilizing the unrestricted FAU provided in the closeout packet. If an unrestricted FAU is not provided in the COP, EFM selects a Department unrestricted FAU (default FAU in UCPath) and notifies the Department.