Federal regulations require full accountability for costs committed in the fulfillment of sponsored programs. Cost Accounting Standards require that costs proposed on a sponsored application be accumulated and reported on completely and accurately.

When a sponsor requires financial and/or narrative reports on total project costs (including other sponsored agreements directly related to the project), it is the responsibility of the PI and department to monitor, track, and assist Project Accounting with the reporting requirements.

Cost sharing may consist of direct expenses such as faculty effort (and thereby related salaries and fringes), lab supplies, equipment, and travel.

Any expense that the University has defined as an indirect cost, such as administrative salaries, office supplies, and operations and maintenance expenses, may not be cost shared. Also, salary dollars in excess of regulatory salary caps, such as the NIH salary cap (even if the effort expended in the support of the sponsored award exceeds the salary cap) may not be cost shared. Unallowable costs as defined in Section J of OMB Circular A-21 may not be cost shared.

Mandatory cost sharing is required by the sponsor as a condition of the award. Ordinarily this requirement will be indicated in the program announcement. Voluntary cost sharing is not required by the sponsor but is nevertheless offered in the proposal by the investigator; ordinarily this is in the form of contributed effort. Cost sharing that is proposed voluntarily by the investigator becomes mandatory (or also known as 'voluntary committed' cost sharing) once the award is made. One other kind of voluntary cost sharing occurs in the case of overruns or overexpenditures, if the additional costs are covered by University funds. All cost sharing, whether mandatory or voluntary committed, must be tracked and accounted for.

The following statements in the proposal budget or budget justification would be considered cost sharing:

• Dr. X will devote 20% of her time to the project at no cost to the agency.
• The department will purchase a data frabulator (cost $15,000) for exclusive use in support of Dr. X's project.

The following statements would not be considered cost sharing:

• Dr. X will be providing expert advice and consultation to the project.
• Dr. X's laboratory is 800 square feet. She also has access to the departmental data frabulator.

If the award is cut so that the scope of work cannot be performed with the available funding, and therefore additional funding from University resources is needed to complete the project as described in the original proposal, a cost sharing form is required at the award stage. It remains the responsibility of the Principal Investigator to determine whether and to what extent cost sharing will be required if an award is reduced.

Any cost of the project not borne by the sponsor is cost sharing. It remains the responsibility of the individual Principal Investigator and department to ensure that other sponsored funds used as cost sharing on sponsored projects are:

1. Allowable,
2. Not offered as cost sharing for more than one project,
3. Verifiable through auditable documentation, and
4. Accumulated at the end of the project and reported to OSR Financial Services for the completion of reports to sponsors.