Q: Is cost sharing the same as matching?

A: The term matching often is a source of confusion. The National Science Foundation and some other sponsors explicitly indicate that they view matching and cost sharing to be synonymous. In addition, OMB Circular A-110 refers to "cost sharing or matching" without distinguishing between the two. For the purpose of UW policy, these terms are considered to mean the same thing. For more information, refer to 1.6.1.1. of the Guidelines for Cost Sharing.

Q: When we cost share, how does this negatively impact our department or the UW?

A: Cost sharing may redirect departmental, school, or central resources from other mission-critical uses to support sponsored research agreements. Cost sharing may reduce the flexibility of researchers to conduct other research by obligating their effort to specific projects. It may increase the requirements for capturing, monitoring, and documenting for audit all commitments and expenditures of cost shared funds. Cost sharing may also decrease the UW’s recovery of indirect costs (F&A costs) by the addition of cost sharing to the research base.

Q: Why is payroll cost sharing preferred over non-payroll cost sharing?

A: UW salaries and fringe benefits are already captured in the UW’s financial system. They’re easy expenses to document, and their value is straightforward to verify. Typically, payroll cost sharing does not require a new outlay of cash. Non-payroll expenses may require a new outlay of University resources. When non-payroll expenses are used as cost share, they may be difficult to document, and their value may be challenging to determine.

Q: What types of salary (Account) codes may be cost shared?

A: See Appendix A: Salary codes to be included/excluded on pages 4-5 of the Update Form instructions. Salary codes that are included in the effort reporting system (ECRT) can be used to meet cost sharing obligations. In limited circumstances, some of the salary codes not included in ECRT may be used to meet cost sharing obligations.

Q: Do I need to request approval from the Dean's office for 1% voluntary committed cost share for the PI?

A: Yes, the dean's or director's office should approve any instance of cost sharing. This is to ensure that proposed cost sharing is consistent with the overall policy to minimize cost sharing on sponsored projects.

Q: When should I use the Effort Commitment and/or Cost Share Update Form?

A: The Effort Commitment and/or Cost Share Update Form is used when there is a change in the specifics of cost share from what you proposed initially or what has been entered into the system. The form is used to make any changes to payroll cost sharing, e.g., corrections to dates or personnel changes. The form should also be used when you want to notify RSP that a non-payroll or third party cost sharing expense has occurred. See CSWG Business Process #5 and instructions for completing the Update Form. Note that this form is also used to initiate changes to sponsor paid effort commitments.

Q: Where do I send the Effort Commitment and/or Cost Share Update Form to be processed?

A: Departmental staff should send the update forms to their Dean’s or Director’s office for approval. Dean’s or Director’s offices should send approved update forms to costshare@rsp.wisc.edu.

Q: If a payroll cost sharing commitment also changes an effort commitment, what should I do?

A: Submit the Effort Commitment and/or Cost Share Update Form that indicates the change to the Payroll Cost Share Expense. If the cost share change also changes an effort commitment, you may need to contact the sponsor if the change is 25% or greater (see UW-Madison Effort Guidelines, Section 1.3.3). The RSP staff person processing the update form will make changes to the payroll cost share and the effort commitment data as needed.

Q: How do we document that a non-payroll or third party expense is cost sharing for another project?

A: After a non-payroll expense (including third party cost sharing) has been incurred that is to be used as cost sharing for another project, submit the Effort Commitment and/or Cost Share Update Form. Follow the instructions for "Required Supporting Documentation for Non-Payroll" cost sharing. The information submitted will be loaded by RSP into the Cost Share Bolt On and will subsequently appear in the WISDM Cost Share Expenditures tab.

Q: What systems are involved in the cost sharing process and how do they work together?

A: For Payroll Cost Sharing
For a new award, information regarding payroll cost sharing is entered into the Projects tab in the WISPER record. In addition, a payroll cost sharing requirement is flagged as a term and appears in the Requirements tab in WISDM. When the award is generated, the information on effort and payroll cost sharing commitments flows into SFS Extensions. In a parallel and separate process, the department enters payroll data. The payroll data entered should mirror effort and cost share information entered into SFS Extensions. Any updates to payroll cost sharing for existing awards are entered in SFS Extensions directly, based on the submission of a Effort Commitment and/or Cost Share Update Form, a no cost extension request, or an additional increment of time/funding.

Each weekend, the payroll cost share calculation runs, which compares information in SFS Extensions with payroll information. If the calculation is successful, the cost share information posts to the Proj_Resource table in the Shared Financial System (SFS). Information is stored in the Data Warehouse, drawn from there, and appears in the WISDM Cost Share Expenditures tab. If the calculation is not successful, then an entry appears on the cost share error report. As a separate process (and after the cost share calculation runs), payroll cost share data is loaded manually into ECRT on a weekly basis.

For Non-Payroll Cost Sharing
Non-payroll cost sharing requirements are entered as Terms in the WISPER system and appear in the Requirements tab in WISDM. After an expense has been incurred, a Effort Commitment and/or Cost Share Update Form and accompanying documentation are submitted to RSP. The information is entered into SFS Extensions in the Cost Share Bolt On, gets written to the Proj_Resource table in SFS, and is stored in the Data Warehouse. WISDM draws the information from the Data Warehouse and displays it in the Cost Share Expenditures tab.

For Third Party Expenditures and Unfunded F&A
Third Party cost sharing is entered as a Term in the WISPER system and appears in the Requirements tab in WISDM. After an expense has been incurred, a Effort Commitment and/or Cost Share Update Form and accompanying documentation are submitted to RSP. The information is entered into SFS Extensions, gets posted to the Proj_Resource Table in SFS, and stored in the Data Warehouse. WISDM draws information from the Data Warehouse and displays it in the Cost Share Expenditures tab.

Q: After cost share calculates and I see it in WISDM on the Cost Share Expenditures tab, how does it get to ECRT?

A: Information is loaded on a weekly basis into the ECRT system. The process is manual and typically takes place on Monday or Tuesday.

Q: If I requested an update to a payroll cost sharing commitment, when will I see the changes reflected in the system?

A: The cost share calculation runs once a week, typically over the weekend. Salary and fringe information should be loaded and available in WISDM on the Monday following the calculation. The F&A for these expenses, however, calculates 2-6 days later. Depending on when an update was entered, it may take about two weeks for the new information to appear in WISDM and ECRT.

At this point, matching the transactions requires doing an analysis using the SFD Transaction tool in WISDM. The process is described in CSWG BPR #8. An enhancement is in the works so that information in the Cost Share Expenditures tab will be displayed summarized by person and pay period. Detail will also be available on a pay period level. The updated displays, once in place, should render the SFD Transaction analysis largely unnecessary.

Q: Where is the commitment percentage in ECRT coming from?

A: The commitment column is comprised of data taken directly from the SFS Extensions commitment system. Data in SFS Extensions originates in the Projects tab in WISPER. Commitment schedules are usually captured at the award setup stage and serve as a baseline for managing effort. For schedules that do not span over an entire effort certification period, the commitment column will display a prorated value (e.g. a 50% commitment row scheduled from 1/1 – 3/31 will prorate to 25% in the commitment column in ECRT for the 1/1 – 6/30 certification period).

Q: How do I compute the percentage for the commitment line that I enter in WISPER?

A: The numerator in the calculation is the person-month(s) commitment that was offered to the sponsor. This figure is easy to identify in the proposal.

Choosing a denominator can be a challenging task, given all the variables to consider. For A-basis employees, the budget period should be the denominator used when computing the effort commitment. For example, a 2-month commitment for an A-basis employee with a budget period of 12 months would result in a 16.67% commitment (2/12). Be cognizant that most guidance on this topic is geared toward sponsored projects that have 12-month budget periods. In reality, not all awards follow this standard. If the budget period is 6 months and it is the Department’s intention to evenly spread out the commitment, then use 6 months as the denominator when computing the percentage for the effort schedule.

If the commitment within a sponsor budget period is being satisfied in a specified block of time, it is important to schedule it accordingly. For example, a person with a 1.0 person-month commitment can be scheduled as 16.67% (1/6 mo.) over a six-month timeframe if that’s when the effort is being exhausted.

Also remember that key personnel have the option of meeting their commitment in a fluctuating manner throughout the course of a budget period. For example, an individual with a 20% commitment over a 12-month budget period can meet it by expending 10% effort in the first 6 months of the project and 30% effort in the last six months.

The percentage entered in the commitment line in WISPER is being used to create the baseline commitment levels in ECRT.

Q: What about C-basis employees? How should their commitment percentages be computed?

A: C-basis employees bring another variable to the table. The denominator in the calculation can vary depending on the number of summer months being paid. The results may range from 8% (1/12 mo.) to 10% (1/10 mo.) for a 1 month summer commitment.

One way to avoid this variation is to simply assume 3 months (6/1-8/31) as the denominator for summer salary and to enter the commitment during June-August only. This practice removes the guesswork of selecting a denominator that is based on having to know future summer salary plans that are far from being set in stone.

This notion is true as well for cost sharing commitments that are supported by salary that is paid during the academic year. The person setting up the effort schedule should use "9" as the denominator, with the resulting percentage only spanning over the academic months (e.g. 1/9 mo.=11% over the period 9/1-5/31).

In an attempt to standardize this calculation, some Divisions have advised Departments to consistently use 11.5 months as the denominator, regardless of pay basis. To illustrate, 1.0 person-month always equals a rounded value of 9% (1/11.5 mo.). Applying this method for all cases can become problematic if the sponsor budget period differs from the typical 12 mo. budget period. It’s important to break the habit and adjust the denominator accordingly to match the atypical budget period. If you are working with a 20 month budget period and a 1.0 person-month commitment, the effort computation would result in 5% (1/20 mo.). The pitfall of applying the 9% throughout the budget period is that the percentage being captured in the effort system is overstating the true commitment (9%*20 mo.=1.8 person-months).

Q: Should the certifiers certify to match the new commitment values in ECRT?

A: It depends. The new commitment column is offered in ECRT as a suggestion and should not be the only factor that’s considered during the certification process. It may help certifiers document their effort in situations where drawing salary from their sponsored projects was decided against, thus creating a cost sharing situation. However, providing this information may lead to certifying and documenting voluntary uncommitted cost share, which is frowned upon. Consider the following scenario for an explanation:

The PI committed 1.0 person-month (paid) each budget period that aligns with the calendar year. For the first effort certification period, the effort card reflects an 8.33% commitment value. As the project progresses, the PI decides to work the entire 1.0 mo of committed paid effort in the second half of the budget period instead of splitting it between both certification periods. It would be inappropriate to document any effort in the first certification period, as it would be considered voluntary uncommitted cost share.

In this scenario, it would be acceptable to certify 0% in Jan.-June and 16.67% in July-Dec. We would not want, however, for the PI to certify anything in Jan.-June if he works and certifies 1 month in July-December. Remember, certified effort on a sponsored project that is not borne by the sponsor becomes cost sharing. And, in this scenario, any effort certified during the Jan.-June time period would be voluntary uncommitted cost sharing.

Here are some tips that can aid certifiers and EC's through this challenging task:

• Managing effort requires cross referencing multiple effort statements and knowing the projections for future salary/cost share.
• Review commitments at a sponsor budget period basis. Effort fluctuations within a budget period are acceptable and do not require sponsor approval, per section 1.3.2. in the Effort Guidelines that can be found here.

Q: Does the commitment percentage have to match the computed effort in ECRT?

A: No. Because the commitment percentage merely acts as a guide, it is not imperative for this figure to mirror the computed. The typical practice on campus, while setting up awards, is to evenly distribute commitments over each sponsor budget period. If the commitment is a paid 1.0 person-month each budget period, campus generally prefers to spread it out as 8.33% (1/12 mo.), given the uncertainty of when the committed effort will actually be performed and paid out.

Q: As an Effort Coordinator, how should I be handling my job and advising certifiers when I encounter discrepancies in the commitment and computed effort columns in ECRT?

A: Please consider the following scenarios and reference the point that applies to your situation for guidance.

Computed effort is less than the commitment percentage:

• The certifier reported additional effort in the previous certification period or is anticipating increasing their effort in the subsequent cert period, thus explaining the reduction. As long as the shifting occurs within a sponsored budget period, nothing needs to be changed. It is discouraged for departments to prepare update forms to have the commitment column match the computed, as this fluctuation is all too common and managing the volume of these types of requests is not the best use of resources.
• The PI decided to forego expending the sponsored project funding for his/her salary. Unless an approval from the sponsor is obtained for significant reduction in effort, the department will need to prepare and route an update form to document the effort as voluntary cost share in order to satisfy the effort commitment.
• The Department mistakenly did not pay the certifier from the sponsored project. Thus, a salary cost transfer must be initiated to retroactively correct the problem.

Computed effort is more than the commitment percentage:

• The certifier reported a lesser amount of effort in comparison to the commitment baseline in the previous certification period or is anticipating a lesser amount of effort in the subsequent period, thus explaining the need to increase. As long as the shifting occurs within a sponsored budget period, nothing needs to be changed. It is discouraged for departments to prepare update forms to have the commitment column match the computed, as this fluctuation is all too common and managing the volume of these types of requests is not the best use of resources.
• The certifier worked more than the commitment and paid him/herself from the grant for the additional effort. As long as the terms of the award do not prohibit this action (e.g., rebudgeting across cost categories is permitted and no salary limits exist), nothing needs to be done.
• The certifier worked more than the commitment and paid him/herself from the grant for the additional effort, plus the effort is a combination of paid and cost shared effort. Lower the cost share so the overall computed effort matches the commitment, unless the cost share is a mandatory requirement of the award.

Q: As an Effort Coordinator, how should I be handling my job and advising certifiers when I encounter discrepancies between the computed effort and certified effort columns in ECRT?

A: If the computed effort shows appropriate progress toward meeting the commitment for the certification period, then the certified effort should be commensurate with the computed effort. If the computed effort does not show appropriate progress or if certified effort differs from computed effort, then some action should be taken. Determining what action should be taken depends on: 1) whether or not computed effort indicates that appropriate progress is being made toward meeting the effort commitment, 2) whether the effort is to be paid by the sponsor (Payroll) or by the University (Cost Share), and 3) whether the computed effort or the certified effort reflects the more appropriate percentage for the effort certification period.

Please consider the following scenarios and reference the point that applies to your situation for guidance:

Computed effort is less than the certified effort:

• Assuming that the computed effort shows appropriate progress toward meeting the commitment for the certification period, if the computed effort is less than the certified effort, then the certifier should reduce the amount of certified effort.
• Assuming that the computed effort does not reflect appropriate progress toward meeting the commitment for the certification period, then the computed effort should increase to reflect appropriate progress. This can be accomplished by either a) initiating a salary cost transfer to show salary paid to the certifier or b) submitting a Cost Share and Commitment Update Form to indicate cost shared effort on the project. Once the computed effort accurately indicates appropriate progress toward meeting the commitment for the certification period, the certified effort should reflect the computed effort.

Computed effort is more than the certified effort:

• Assuming that the computed effort shows appropriate progress toward meeting the commitment for the certification period, if the computed effort is more than the certified effort, then the certifier should increase the amount of certified effort.
• Assuming that the computed effort exceeds the amount necessary to meet the commitment for the certification period, then the computed effort should decrease to reflect appropriate progress. This can be accomplished by either a) initiating a salary cost transfer to decrease salary paid to the certifier or b) submitting a Cost Share and Commitment Update Form to lower cost shared effort on the project (if the cost share is a mandatory requirement of the award, work with your RSP accountant to verify that the obligation will still be met). Once the computed effort accurately indicates appropriate progress toward meeting the commitment for the certification period, the certified effort should reflect the computed effort.

Computed effort and certified effort are within 5% of 100% total effort:

A precise assessment of effort is not always feasible, nor is it expected. Reliance, therefore, is placed on estimates in which a degree of tolerance is appropriate. If a reasonable estimate of the actual effort is within five percentage points of the effort percentage shown on the statement, it is permissible to certify the level of computed effort that appears on the statement. Differences between computed effort and certified effort that are 5% or less (based on 100% total effort) should be reviewed further. Effort cards should be returned to the certifier to verify that the level of effort was certified correctly.

• Assuming the level of effort was certified incorrectly, the certifier should revise their certification to certify their effort at the computed effort level.
• Assuming the level of effort was certified correctly, the effort coordinator should follow the appropriate instructions above for "Computed Effort is Less than Certified Effort" or "Computed Effort is More than Certified Effort."

Q: Our division submitted payroll cost share and commitment update forms for four different faculty/staff to meet a mandatory cost sharing commitment. The dates for the cost sharing range from October 2006 to September 2010. I was told that RSP can’t enter forms for periods prior to January 1, 2008. Why not?

A: The University began using its current Shared Financial System in February 2008. The Cost Share Bolt-On was created as part of SFS, and information can be captured in it as far back as January 1, 2008, but not before.

Q: Our department has a mandatory cost sharing commitment on a grant. We’re about $400 short of meeting the commitment and realized that we have an LTE-Hourly staff person whose time can be used. He was paid on a 135 grant while working on the project. What do we need to do to capture this cost sharing?

A: First, your department may want to consider increasing the cost sharing of the PI, Co-I, or senior/key personnel on the grant to meet the cost sharing commitment. If you choose to use the salary and fringe of the LTE, then you should submit the Cost Share and Commitment Update Form. Another option would be to use a non-payroll expense to meet the cost sharing requirement.

Q: Our department is submitting a grant proposal, and the grant program does not allow enough funding to pay for the time the principal investigator and co-investigator will spend on the project. We intend to cost share from our department. Would this be considered payroll or non-payroll cost sharing?

A: Salary and fringe for the principal investigator and co-investigator would be considered payroll cost sharing. Remember that the Dean’s office should review this cost sharing request. They may advise you not to quantify a cost sharing commitment in the proposal for the PI/Co-I. In that case, you would enter $0 in the budget and indicate that the PI/Co-I will provide adequate oversight of the project and that other University resources would be available as necessary to support the project. Should the project be funded under these circumstances, you would need to cost share 1% of the PI’s time and indicate as such in the Projects tab in WISPER. The alternative would be to commit a certain percentage of time for the PI/Co-I and, should the Dean’s office approve this cost sharing, you would have to identify a source to pay for that salary and fringe. Also note that, if the sponsor allowed you to use F&A on the salary and fringe as cost sharing, the F&A would be considered non-payroll cost sharing.