Funds Received/ Expenditures Made
Researcher
It is the researcher’s responsibility to ensure that all spending on the research account is in accordance with the rules of the granting agency, the terms of the agreement, and the policies of the university. Any questions on such matters should be directed to Research Finance or the department, before expenditures are made.
The researcher should ensure that all personnel transactions, as well as any travel made on the account, are approved by the department, as per University Financial policies. In addition, most departments will have their own policies regarding approval of other expenditures, such as journal entries, cheque requisitions, and purchase orders and researchers are expected to abide by those policies as well.
Department
The degree of assistance offered by the department with regard to spending on research grants may differ across departments. It is the responsibility of both the researcher and the department to ensure that this role is made clear prior to any charges being made against the account.
Health Research Services (HRS)
HRS may be called upon to assist in large equipment purchases, as these purchases relate to space, and ownership issues.
McMaster Industry Liaison Office
When researchers are subcontracting out work, MILO facilitates agreements to ensure appropriate intellectual property terms.
Research Finance
The Research Finance offices are the key players in receiving income, and processing expenditures on a research account. Research Finance is responsible for tracking research income by source and agency and managing any overhead or surcharges.
All cheques and income transfers must be processed through respective Research Finance offices to ensure accurate recording of research income. Research Finance also ensures that expenditures meet granting agencies’ terms, comply with university policies, and that there are sufficient funds in the account to pay for any charges.
Granting Agency Guidelines
Each granting agency has different guidelines pertaining to spending on their grants. Some agencies are more specific than others in their requirements. A list of guidelines for the major granting agencies are available from HRS, the department, or from Research Finance. While these guidelines are not entirely complete, they give the researcher a good idea of what is, and is not allowed to be charged to the research account.
University Guidelines, Policies and Procedures
McMaster University’s policies and procedures apply to all research grants; however, the granting agency’s rules take precedence in most situations. For example, if the agency allows a higher mileage rate than the University, that rate will be honoured.
Rules concerning personal expenses, allowable travel costs, possible conflict of interest situations, payments to close relatives on a grant, and the additional payments to full-time employees (including the researcher) are just a few of the areas that fall under specific policies of the university.
Types of Income
The granting or contracting agency will specify if a research account will receive funding. The University prefers to receive the funds up-front. As mentioned previously, new research accounts must be established for new projects. Mixing different project funding and the related expenses is not permitted. Deposits will be reviewed to ensure that funds are deposited to the appropriate account.
The funds can be received in various ways: Cheques should be mailed to the university and must be deposited directly into a university account. For a non-peer reviewed grant, cheques must be made payable to McMaster University and be sent to the appropriate Research Finance Office for deposit with supporting documentation from the granting agency. Some agencies will transfer the funds to the university’s bank and the cashier’s office will transfer the funds to the research account. The university is required to invoice the agency after expenses have been incurred. The Research Finance Office will invoice the agency on behalf of the researcher.
Types of Expenditures
Hiring into a Position
Distinguishing between full-time employees, part-time employees and individuals on an employment contract, and the policies and procedures governing the hiring, and paying of these individuals, is very complicated. If you are unsure about the possible employment status of an individual, contact the Department Manager or Human Resources for clarification and advice.
A Notification of Vacancy (NOV) must be completed when a researcher wants to hire a new or replacement full-time staff member. The information required on this form enables the university to fulfill its human resources policy and procedure obligations and pay equity legislation requirements. This form must be approved by the department and forwarded (with one copy) to Research Finance.
When Research Finance is satisfied that confirmed funding to cover salary and benefits costs are in place, and that the project specified is appropriate for the salary charge, they will also approve the form. Once properly signed, the form will be forwarded to human resources so that the hiring process can begin. Human Resources will guide the researcher through the hiring process including advertising, interviewing, and the selection process.
Other Payments to Individuals
Research Finance must also approve other payments to individuals on research grants so they can ensure that there are sufficient funds in the account, the payment meets the terms of the grant, and that the coding being used is appropriate for the account. To approve these payments forms must be sent to Research Finance prior to the payroll cut-off dates. A list of cut-off dates can be obtained from payroll or the Research Finance web site.
Graduate Student Payments
Payments for graduate students should be arranged through the appropriate graduate studies office. That office will confirm the amount of the payment, as well as the term. They will complete the payroll authorization form, and forward it to Research Finance, who will give final approval. Research Finance will ensure that the account is authorized to pay a graduate student, and that there are sufficient funds to do so.
Travel Expense Reports and Advances
All travel expense reports and travel advance forms must be approved by Research Finance. If the traveller is the researcher, it must also be approved by the departmental signing authority. Granting agency and university policies govern expenditures on these reports. These reports must be sent to Research Finance, who will approve and forward to Travel Management Services.
Cheque Requisitions and Purchase Requisitions
Purchases of less than $2,500 should be processed through a cheque requisition, and purchases in excess of $2,500 must be processed through purchase requisitions. Although primary responsibility rests with the researcher, the Research Finance Officers ensure that there are sufficient funds available in the grant and will check to ensure that the purchase is in compliance with the granting agency guidelines and university policy. If you are unsure about the eligibility of a purchase or how it must be processed, consult the Research Finance Office.
Electronic Journal Entries
Electronic journal entries are used to allocate charges to the appropriate grant accounts, as occasionally funds must be transferred from one account to another. A form must be completed in full, the description for the entry must be explicit, and the form must be approved by an account signing authority. All journal entries require that the researcher and department have sufficient original documentation (receipts) for the transfer, in the event it is requested by either Research Finance, the university, the granting agency, or by internal or external auditors.
The use of journal entries should be kept to a minimum. Most expenses are recorded to an account through payroll and cheque or purchase requisitions, and therefore journal entries should not be necessary.
If expenses must be moved from one account to another, specific charges must be itemized and attached to, or included as part of the journal entry. Lump-sum transfers of expenses are not acceptable to the university, auditors, or granting agencies.
Once approved by the researcher and department, completed electronic journal entries are forwarded automatically to Research Finance for approval.
Internal Services and Automatic Charges
University area hospitals provide services which will be charged directly to the research accounts. These services include photocopying, telephone, laundry, animal quarter expenses, computer repairs and computer support, scientific and office supplies. The researcher should expect the service provider to forward an itemized summary of the charges.
Overhead and Indirect Costs
Research Finance is responsible for removing the overhead and research surcharge from grants and contracts. This policy is outlined in the document available from the McMaster Industry Liaison Office.