20.14 – General (Non-Grant) Cost Transfers
February 2, 2010
A. General. Cost transfers are used when an expense is incorrectly processed on one budget or expense code and needs to be transferred to another. Cost transfers may be made on most budgets; however, if the transfer involves a grant or contract (“K” Accounts), additional steps may be required [See APM 45.07]
B. Significance of Cost Transfers. Cost transfers are perhaps the most sensitive area in financial management. They are an indication that something unusual happened and that further investigation may be required. Cost transfers may not be used as a means to transfer income from one account to another.
C. Procedures. The following guidelines are provided to ensure cost transfers are appropriate and authorized.
C-1. Timely Corrections. The University of Idaho requires that a corrective cost transfer be completed within 90 days after the original incorrect transaction was posted to the account. In very limited circumstances, a cost transfer requested more than 90 days after the original transaction may be authorized if additional documentation, including an explanation of the internal control weakness that prevented a timely correction, is submitted with the request. The request must also identify the corrective action taken to prevent a reoccurrence. Cost transfers requested for a closed fiscal year will not be authorized.
C-2. Proper Explanation Required. Units must justify each cost transfer. The reason for the transfer must state in detail how the error occurred and why the transfer is necessary. See Paragraph C-1 for additional requirements if the transfer is entered more than 90 days after the month closed. Statements such as 'to correct error' or 'clerical error' are insufficient. Document numbers (JVs, IDs, TRs, etc.) must be referenced. Cross referencing text (cost transfer number, date, explanation, and name of person entering cost transfer) must be added to the original document on which the error occurred. [ed. 2-10]
D. Contact Information. Questions about cost transfers should be referred to Business Systems and Accounting Services, (111) 111-2130. For grants and contracts related cost transfers, questions should be referred to the Office of Sponsored Programs, (111) 111-6689.