To: School Deans
Charles Kruger, Vice Provost and Dean of Research and Graduate Policy
Geoffrey Grant, Associate Vice President for Research Administration
Date: September 25, 1999


Beginning with expenditures for the month of October 1999, Stanford will strengthen its internal controls for direct charges to sponsored project and cost sharing accounts. We are writing to you to explain the reasons for the change in advance of announcing it to all faculty and department administrators so that you can assist in communicating this change and responding to questions.

In place of the current monthly certification of expenditures by the Principal Investigator, we will divide the process into the following two components. We expect that individual Schools will incorporate their own procedures in the implementation of these requirements.

1. Monthly Expenditure Review

The PI or other individuals in a position to be knowledgeable about the project account will review monthly expenditures for errors, accuracy of charges, unusual or unanticipated charges, etc. Apparent errors and questionable charges must be brought to the PI's attention and, if needed, corrected promptly. While this review should already be standard practice, a signature on the Monthly Expenditure Statement is now required to document its completion.

This review must be completed within two months of the end of the month of the statement. For example, October expenditures must be reviewed before December 31 (see Timeliness Calendars).

2. Quarterly PI Certification

The PI's certification will be required at the end of each academic quarter. To be considered timely, the certification must be completed within two months of the end of the academic quarter being certified. Listed here are the deadlines for the certification of each academic quarter (see also Timeliness Calendars).

Quarter Months Included Certification Deadline
Fall October, November, December February 28
Winter January, February, March May 31
Spring April, May, June August 31
Summer July, August, September November 30

The review and certification wording that will appear each month is also attached to this memo. Although the certification language will appear on each month's statement, the PI only needs to certify the statement for the last month of each quarter. The PI would certify an earlier month's statement if a) there are no expenditures in the third month or b) the project ends mid-quarter.

Note: Care should be taken to perform the review and certification as soon as possible when an award ends. This will ensure that any adjustments are made promptly, allowing for accurate reporting to the sponsor within the timeframe specified by the sponsor.


RATIONALE - Monthly Reviews

A monthly review of project expenditures is an essential component of good project management. To assist those performing this review, we have prepared an expenditure checklist and made it available on the web.

This checklist includes links to policies, tools, and other reminders. It is available as a resource, and is not intended to be retained as a permanent record of this review.

PIs may perform this monthly review of expenditures and sign monthly Expenditure Statements for that purpose. In that case, the PI must ALSO certify expenditures at least quarterly (see below). They may certify more frequently if they wish.


RATIONALE - Quarterly Certifications

Changing the PI's certification from monthly to quarterly facilitates a timely review of the allocability of charges, particularly of the level of effort spent on each project. While effort may reasonably fluctuate from month to month, the PI's quarterly certification attests that expenditures are appropriate and, in particular, that salaries "are reasonable in relation to the work performed."

Last year, Stanford changed the wording of the certification for salary charges to reflect work performed "taking into account the period of performance for the project." We have been advised that this might be interpreted to mean that salary could be certified on the basis of an expectation of work to be performed in the future. Salary charges must be certified on the basis of work performed - not work that the PI expects will be performed.

Certification every academic quarter allows for reasonable fluctuation of effort while permitting PIs to certify salary charges in a timely fashion. Salary charges do not otherwise have to be adjusted on a monthly basis.

This topic is discussed in the PI sessions on Stewardship and Compliance currently being scheduled and conducted by our offices for all Stanford PIs.


Good business practice mandates that errors be corrected in a timely manner. This means that transfers should be initiated as soon as the need is detected based on the monthly review or the quarterly certification. The journal should provide the documentation necessary to support the allocability of the charge to the new account. Explanations for a lack of timely transfer are required for any transfers made after the deadline for quarterly PI certification. A checklist for cost transfers is available on the web.


It is essential that Stanford maintain the integrity of its controls to assure that sponsors are charged correctly and to avoid more onerous and costly control mechanisms and reporting requirements. We will continue to monitor PI certifications each quarter as we have done for the past several years. Questions or problems in this regard should be brought to the attention of any of the following individuals: