Cost Transfer Best Practices - Justifications and Consequences


Critical Concepts

Steps to Take

Initiators Completing Cost Transfer Justifications

1. When completing the Cost Transfer in Oracle, use this KBA Cost Transfer
2. At the end of the Cost Transfer process after clicking Submit, enter the following information in the Submit Adjustment for Approval dialog box: 
3. Answer the following questions, considering a 1000 character limit:

a. Why is the Cost Transfer being done?
b. What is the benefit to the Project or other Chart Segment, the Cost Transfer will be sent to?
c. Why is the Cost Transfer untimely, Expense is past 90 days?
d. What action is being taken to avoid the necessity for this type of Cost Transfer in the future?

4. Before answering questions for High Risk Justifications, coordinate with PI to obtain more details on how the item being transferred directly benefits the Contract or Grant that you are moving to:

The goal of the explanation is to have a stand alone justification for the auditors to avoid additional questions of PI or department, for example:

a. If moving a lab Expense such as a chemical, ask the PI how that chemical is used in support of the research

b. Attach any documentation or include in the justification the name and employee ID (EID) of whom the Expense belongs to

c. If it’s High Risk you must address these questions, for reference:  Project Transaction Codes - IFIS E Codes High Risk Justifications

1. Are you moving to a federal fund?
2. Older than 90 days?

Approvers Reviewing Cost Transfer Justifications

1. Review Cost Transfer Guidelines and Resources, especially the ramifications of a disallowance
2. Review the Initiators’ requirements
3. If you need additional guidance, work with SPF
4. The PI and Department will be responsible for covering any disallowances, see Audit Considerations

Audit Considerations

Audit Disallowance Examples 

If the Cost Transfer is approved, the following examples won’t pass audit:

Consequences of Audit Disallowances

Guidelines and Resources

UCOP Direct Costing Procedures applicable to Expenditure Adjustments

Cost Transfer Overview

Project Transaction Controls - IFIS E Codes

If you still have questions or need additional assistance, please submit a ticket