Reconciling your grant accounts on a monthly basis will ensure that expenditures are appropriate to, and within the restrictions of, your project. All costs must be allowable, allocable, reasonable, consistently applied, and necessary to achieve project aims.

A cost transfer is an account change to a previously approved and booked expense that takes place within 90 days of the booking of the original expense. You can correct an error found in monthly review accounts with a cost transfer.

A clearly articulated justification is required to establish and maintain an audit trail. Provide a full explanation of the need for the transfer. An explanation such as “to correct error” or “to transfer to correct project” is insufficient.

• Explain why the original charge was not allocated to the correct account, and what corrective actions will be taken to ensure the error is not repeated in the future.
• Detail how the expenditure (whether salary or non-salary) benefits the project.

Cost transfers occurring more than three months from the month of initial expense require additional justification and approval of the Late Cost Transfer Committee. Cost transfers to or from accounts awarded under federal funds receive additional scrutiny.