Effective Award Closeout
When do you start planning the close-out process?
- At the time the proposal is designed.
- At the time the award is accepted.
- At the time modifications, extensions or supplements are approved.
- Just prior to the expiration of an award.
- At the time of expiration of an award.
- All of the above.
If you answered “5”, you are right. By starting at the proposal stage, special and problematic close-out issues can be identified and addressed. At the award stage and with each modification, justification and negotiation can occur to address problematic close-out issues. Effective planning and communication of close-out procedures should occur from the beginning of the proposal through the completion of all close-out requirements.
This short discussion paper is meant for use by OSR and department administrative staff. It is not meant to be definitive, or all-inclusive, but serves as an introduction to the topic. More extensive processes are being developed.
Who should understand the close-out procedures?
Persons in OSR pre-award roles should understand the close-out requirements of the sponsor and the effect those requirements will have on post-award project administration and for the accountants in OSR finance roles. It is necessary to understand the flexibility as well as the restrictions required for post-award and financial administration in order to meet final invoicing and financial reporting requirements.
Persons responsible for negotiating subagreements must understand the close-out requirements. An item the prime awardee (Stevens) must consider while drafting the subagreement and during negotiations with the subawardee is that adequate time is allowed to receive all required reports and deliverables in time to complete Stevens’ required sponsor reports. OSR will monitor projects and notify Principal Investigators (PI) and departmental administrators about upcoming award expirations, including their roles and responsibilities.
The PI and his/her departmental administrator should also understand the close-out procedures, especially if there are any special deliverables due to the sponsor other than a technical report. These other deliverables may require significant involvement and input from the PI in order to complete.
How do you know what the close-out requirements are?
For contracts, all of the close-out requirements should be included in the terms and conditions. Typical examples of issues that should be addressed in the contract are:
- the types of reports or deliverables that will be due
- timeline when reports and deliverables are due
- terms for final payments
- whether the award is on a fixed-fee basis or cost-reimbursable basis
- early termination processes
- cost-sharing and/or program income applicability
Relevant administrative staff must understand all of the referenced policies, guidelines and forms mentioned in the sponsor award document including subparts C and D of OMB Circular A-110, OMB Circular A-21 when the award is from a federal agency. Subrecipients must be monitored in accord with the requirements of OMB Circular A-133.
Who is responsible for close-out requirements?
The PI will always be responsible for any technical reports and related deliverables. Any type of financial report or invoice will generally be the responsibility of OSR; however Stevens asks the PI to review these financial documents prior to sponsor submission. OSR will coordinate the preparation and submission of equipment reports or invention statements that may be required. Equipment reports will generally be prepared by the asset management area and reviewed by the OSR staff. Invention statements will generally be prepared by the PIs in conjunction with input from the Office of Research and Enterprise Development. OSR must also understand Stevens’ policies and procedures relating to the close-out process in order to ensure those requirements are met in addition to the sponsor’s requirements.
If effective close-out is so important, why is the process often neglected?
In the process of negotiating awards, establishing accounts, negotiating subcontracts, reviewing expenditures for allowability allocability and reasonableness, reviewing rebudgeting and expense transfers for allowability, allocability and reasonableness, requesting no-cost extensions, monitoring time and effort reporting, invoicing, recognizing revenue, managing accounts receivable, preparing interim financial reports, etc., close-out of an award often falls to the bottom of the list. It is critical to remember that project close-out is a compliance process monitored by sponsors.
Now that you have effectively closed an award, are you done?
OSR and department administrators should be aware of the required record retention policies of both Stevens and the sponsor.
Questions may be directed to OSR personnel.