Revised Budget Workshop Carla Kirksey OME Mission of the Office of Migrant Education To provide excellent leadership, technical assistance, and financial support to improve the educational opportunities and academic success of migrant children, youth, agricultural workers, fishers, and their families. Objectives Review the Process of the Revised Budget Review the Cost Analysis Checklist Provide opportunity to ask questions regarding budget items Basis of Your Budget Your approved Application Project Narrative Your approved Application ED 524 (Sections A, B & C) • Section A: Categorical description of use of Federal funds • Section B : Categorical description of the use of NonFederal funds • Section C: Narrative of the use of Federal AND NonFederal funds Attachment J Subsequent Changes and Revised Budgets 3 OME Monitoring of Fiscal Matters Review of Application Budget Review of Revised Budget Review of APR Expenditure Report Monthly or Quarterly Review of Drawdowns Review of Grant Balance at Continuation Review of Use of Funds for Specific Requests On-site and Desk Monitoring Carryover Review Revised Budget Checklist Overview How Is Cost Sharing / Matching Handled? Review of Application Budget Not Required by program laws or regulations If proposed in application, must be provided Must be outlined in ED 524, Sections B (Table) and Section C (Narrative) Treated as Federal funds are treated The Budget Process Application Budget Analysis With Budget Request ED 524 ED 524 Attachment Js Your Acceptance of Recommended Revised Budget Department’s Recommendation GAN Attachment Js Expenditure Reporting & Carryover Projection Department’s Recommended Continuation APR, Cover Sheet and Section E GAN Original Attachment Js Your Acceptance of Continuation & Explanation of Carryover Revised Budget 7 What Are the Basic Considerations of Cost? Reasonable Allocable Allowable 8 How Do I Determine a Reasonable Cost? A cost is reasonable if it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost. 9 How Do I Determine an Allocable Cost? A cost is allocable to a particular cost objective if the goods/services involved are chargeable/assignable to such cost objective in accordance with relative benefits received/other equitable relationship. A cost that can be traced to specific activities of a grant project. 10 How Do I Determine an Allowable Cost? Is necessary & reasonable for the performance of the award Conforms with Federal cost principles Is consistent with uniform procedures of the organization Is determined in accordance with generallyaccepted accounting principles Is not included in any other Federally-financed grant (unless authorized by statute) 11 What is Equipment? Tangible nonexpendable personal property • having a useful life of more than one year and • an acquisition cost of $5,000 or more per unit. Fungible property (paper, pens, pencils, calendars, CDs, DVDs, chairs, desks, etc.) Less than $5,000 per unit NOT equipment, intangible property (e.g., software designs), debt instruments, and contractor inventions (e.g., student classroom alertness monitor/SCAM) 12 Indirect Costs Difference between agreed upon indirect cost and a restricted indirect cost rate cannot be used for cost sharing Direct Cost Base must not include • • • • Each sub-award in excess of $25,000 (contracts) Stipends Tuition and related fees Equipment, as defined in 34 CFR 74.2 8% applies to sub-awards that fund training If negotiated indirect cost rate is lower, the grantee must use the lower of the two 13 What Kind of Financial Management Systems Do I Need? • Relate financial data to performance data • Accurate, current, & complete disclosure • Records that identify source & application of funds • Effective control over & accountability for all funds, property, & other assets • Written procedures to minimize the time between transfer of funds to the recipient for determining costs reasonableness, allocability, & allowability • Accounting records supported by source documentation • May require adequate bonding & insurance 14 Things to Remember Email the 524 form in a Word document to your program officer with only the current year’s column. Revised budgets are due August 30, 2013. Have proper documentation on file at your project concerning contractors. • Refer to the Cost Analysis Checklist for the additional information on documentation for contractors. Send a full narrative only if there are changes to the budget. • Highlight specific changes from the original application’s budget. Revisions Financial expression of the project Required to report deviations from budget and project plans Request prior approvals for budget & plan revisions, in accordance with EDGAR 74.25 Grantee prepares & submits a budget revision to acknowledge & accept the award & all conditions 16 Budget Revision—Expanded Authority A one-time extension of the expiration date of the award of up to 12 months • To complete project activities, NOT spend down funds Carry forward unobligated balances to subsequent funding periods 17 Carryover Balance Unexpended funds from a previous budget period that are authorized for allowable costs in a current budget period Can be used in the next budget period for allowable activities without any action by ED or the grantee unless restricted by program staff as an award condition Program staff may require a description of how the unexpended funds will be used This year, some grants were offset for carryover so funds could be redistributed. 18 Budget Revisions—Prior Approvals • • • • • • Change in scope or objectives Need for additional funding Change in key personnel specified in the application Absence for more than 3 months of PD or PI A 25% reduction in time of PD or PI Transfer of amounts budgeted for indirect costs to absorb increases in direct costs, or vice versa • Costs that require prior approval in accordance with 2 CFR • Transfer of funds allotted for training allowances (stipends) to other categories of expense • If NOT described in the application & funded in the approved award, the transfer or contracting out of any work under an award 19 When Are Revised Budgets Due? For Continuing Grants, Revised Budgets are due •August 30, 2013. References Program Statute: Title IV, Section 418A of the Higher Education Act of 1965 as amended by section 408 of the Higher Education Opportunity Act P.L. 110-315 (H.R. 4137) Program Regulations: 34 CFR Part 206 Education Department General Administrative Regulations (EDGAR) Cost Principles • Circular A-21 for Educational Organizations (2 CFR Part 220) • Circular A-122 for Non-Profit organizations (2 CFR Part 230) Grant Attachments FAQs Conferences and Meetings 21 OME Contact Carla Kirksey 202-260-2114 [email protected] Always seek the assistance of your program officer first!