The University of Texas at Arlington Office of Research and Office of Accounting and Business Services Brown Bag Traini

1. The University of Texas at Arlington Office of Research and Office of Accounting and Business Services Brown Bag Training Session Four: Gifts versus Grants

2. Gifts vs. Sponsored Projects: Overview • Gifts vs. Sponsored Projects Definitions • Sponsored Project Indicators • Gift Indicators • Research Gifts • Account Management

3. Gifts vs. Sponsored Projects: Definitions • A sponsored project (grant, contract, cooperative agreement) is: • Externally funded activity with a statement of work or set of objectives that provides a basis for sponsor expectations • Enforceable by law • Subject to revocation for cause • A sponsor and recipient exchange of items that have economic value (including knowledge, IP)

4. Gifts vs. Sponsored Projects: Definitions • A gift or donation is: • A voluntary and irrevocable transfer of money, services or property (e.g., equipment, personnel time and skill, etc.) • Without any expectation of or receipt of goods or services from the recipient • Without performance requirements either written or oral

5. Gifts vs. Sponsored Projects: • Gifts are handled through the Office of Development (30-accounts) • Grants are handled through the Office of Research (26-accounts) • Any gift determined to be a sponsored project will need to follow the policies and procedures of the Office of Research and the UT System Regents Rules and Regulations

6. Sponsored Project Indicators: Sponsor • Determined a sponsored project if the sponsor: • Is a government entity (Federal, State, or Local) or includes governmental flow-thru funds • Awarded funds through a competitive bid process or in answer to an RFP (Request for Proposal) • Requires the signature of an authorized University Official and/or the PI • Issued a contract, cooperative agreement, consortium agreement, subgrant, subcontract, or purchase order • Identifies or assigns a technical monitor • Funds a project for a specific scope of work, product, service or other deliverable

7. Sponsored Project Indicators: Terms and Conditions • Determined a sponsored project if the Terms and Conditions: • Impose publication restrictions • Require conveyance of rights to tangible (equipment) or intangible property • Require an audit of facilities or other University resources • Stipulate compliance with federal or state regulations, unallowable costs, subcontracting, insurance, warranties, indemnification, proprietary or confidential information, modifications, terminations, penalties, or applicable law

8. Sponsored Project Indicators: Financial Restrictions • Determined a sponsored project if financial restrictions include: • How funds are to be used or include a line item budget • A start or end date on the use of funds • Facilities and Administration Costs (Indirect) • The return of unexpended funds for any reason • Invoicing or detailed financial reports • Funding based on cost reimbursement contingent upon programmatic and fiscal reporting

9. Sponsored Project Indicators: Special or Other Considerations • The following issues also require special consideration in determining external funding as either a gift or sponsored project: • Funds used as matching or cost sharing towards a sponsored project • Funds for activity involving humans subjects, animals, radiation hazards, biohazards or R-DNA • The PI has a potential financial conflict of interest with the sponsor • Funds are used to generate program income for a sponsored project

10. Gift Indicators: • Gifts may require minimal reporting to the sponsor in the form of a general statement of how funds are used • Gifts may be limited towards general use in a specific department, lab, or research area • Gifts may include: endowments, construction projects (renovation or equipment), or general student financial assistance (fellowships or scholarships) • External funds may be determined to be a gift if there are no sponsored project indicators

11. Research Gifts: Overview • During FY 02, the Texas Higher Education Coordinating Board (THECB) issued a memorandum on reporting research expenditures among Texas Public Universities • The memorandum defined “research” and established standards for reporting research expenditures • The total amount of research expenditures our University has in a fiscal year partially effects funding allocations our University Receives from the Texas Legislature in the following fiscal year • It is imperative our University properly classifies research expenditures

12. Research Gifts: Procedure • The Offices of Research (OR), Development (OD) and Accounting and Business Services (OABS) developed a procedure to properly classify research gifts in accordance with the accounting standards in the THECB memorandum • Research Gift Procedure: • Any gifts that may be for research, OD sends to OR for review and deposits the check into a holding account • If OR determines to be research, OR sends the PI a Research Gift Certification Statement • If OR does not determine to be research, OD follows normal procedure • If the PI signs the certification statement, OABS creates a research gift account and transfers the deposit into the research gift account

13. Research Gifts: Requirements • Cash Gifts designated for “research” or utilized for research purposes, may be classified/coded as Research Expenditures if they meet the following requirements: • Over 50% of expenditures will be for “research” as defined by the THECB memorandum • The PI, or authorizer of the account signs a Research Gift Account Certification Statement (attached)

14. Research Gifts: Other Key Points • Gifts determined to be Research: • Are still GIFTS, not Grants • Are NOT managed by the Office of Research • The office of Research only assists the PI in the research determination for completion of the Research Certification Statement • Are NOT subject to F&A (indirect) costs • Research Gift Accounts only exist in order to properly classify the University’s research expenditures in accordance with the THECB memorandum

15. Account Management: Overview • Grant Accounts (26-Accounts) • Research Gift Accounts (30-7XXX-XX) • Gift Accounts (30-account)

16. Account Management: Grant Account (26-accounts) • Supported by the Office of Research • Managed using award criteria and related regulations • Will have definite beginning and ending dates • Funds MAY NOT be comingled

17. Account Management: Research Gift Account (30-7XXX-XX) • Initiated through the Office of Research • Supported by the Office of Accounting and Business Services • Requires a Research Gift Account Certification Statement • Managed using University Policies and Procedures • Must comply with donor intent • May include many deposits from multiple donors as long as they are for research

18. Account Management: Gift Account (30-account) • Supported by the Office of Accounting and Business Services • Managed using University Policies and Procedures • Must comply with donor intent • Deposits made to general gift funds may be made to the same account, as long as there is a similar purpose

19. Brown Bag Training Session Five • Federal Demonstration Partnership (FDP) • Thursday February 27th, 2003