PURPOSE

The purpose of this statement is to provide general principles to be used for establishing an original budget for a contract and grant account.

GENERAL GUIDELINES/APPLICABLE POLICIES

The detailed budget for a contract and grant account should reflect the expenditure object code breakdown as submitted and approved by the awarding agency and coincide, where feasible, with the University's expenditure object code structure (see appendices).

PROCEDURES

The Office of Contracts and Grants will prepare the necessary documentation to enter the original budget data into the accounting system based on the award, original proposal, and any negotiated budget change.

AUTOMATIC BUDGET REALLOCATION USED FOR CONTRACTS AND GRANTS

The current accounting system provides for contracts and grants to be budgeted at the major object code, i.e. 2600 with the exception of line items 1100, 1200, 1300 and 6500. Expenditures must be at the detailed level such as 2601 Office Supplies (Exhibit A-1). Since the budget is at the major object level and the expenditures are at the detailed object level, the accounting system will automatically draw the budget from the higher level to reflect the current unexpended balance.

If there is insufficient budget available at the major level, the system will generate a deficit (-) balance on the FRS system.