The Residual Balance Procedure establishes an institutional procedure for residual revenue earned on restricted fixed-price or fee-for-service contracts.
Fixed-price or fee-for service agreements require the university to perform work to the sponsor’s specifications regardless of the actual cost and the proposed budget must ensure that actual costs and the sponsor’s funding will closely align. When costs are underestimated, the investigator or academic unit will have to cover excess expenses.
All costs for a fixed-price or fee-for-service award must be expensed directly to the assigned FMS project account. With reasonable budgeting and accurate charging, neither a deficit nor a surplus of fund will arise. Upon project completion or termination, deficit or surplus (residual) balances will be transferred to a sponsored project residual account. In order to ensure there is not an excess accumulation of residual balances, any project balance greater than 10% will require a justification along with review and approval.
DISPOSITION OF RESIDUAL BALANCES
After project completion the balances will be transferred to a UTHealth sponsored project residual balance account. Each Principal Investigator will be assigned one FMS project account to enable transfer of sponsored program residual balances.
The account is solely for residual balances from fixed-price/fee-for-service contracts that have concluded whereby the sponsor’s terms and conditions have been met. No other funds or income may be deposited in this account.