Grant Set up
Award letters and contracts must be reviewed by ROO to ensure the terms and conditions are acceptable. If necessary, the contract will be re-negotiated to follow LSHTM’s preferred terms of trade with the funder.
Negotiations on contracts or award letters issued by key funders or funders with a long-standing relationship with LSHTM can normally be concluded quickly. Negotiations on behalf of complex projects or with new funders will take longer.
The ROO team will request a meeting with the Principal Investigator/Project Administrator to discuss requirements for setting up the grant. This will cover:
- Awareness of any issues arising from the contract negotiations
- Comparison of the budget awarded to the budget requested and resolution of any discrepancies
- Clarification of funder’s virement rules, payment details and reporting requirements
- Clarification of authorisation details
- Agreement on how the funder’s budget categories will map across to LSHTM account codes
- Clarification of details (financial and non-financial) required to set up any sub-contracts for the project
- Assurance that appropriate governance and ethics approvals will be in place and, in the case of clinical trails, that insurance cover is assessed as adequate
When the grant award has been accepted by ROO or the contract signed by LSHTM and the funder, the grant will be set up on the financial system (Agresso) and activated.
The ROO team will send the PI and Project Administrator copies of:
- Award letter or contract
- Budget breakdown
- Grant details – authorisation, payment and reporting details, virement rules
- Grant number
Foreign Currency Budgets
Grants in foreign currency (usually EUR or USD) will be set up using the conservative exchange rate used at the time of costing the proposal – unless the funder has specified the exchange rate that should be used.
EC grants (FP7 and ERC) have their own rules for managing currency exchange.
The equivalent sterling budget (GBP) will remain fixed throughout the project except in exceptional circumstances. PIs should manage the project in accordance with the sterling budget.
Gains and losses on currency fluctuations will be dealt with by the Finance Department. The School's policy is that any currency gains across the School will be pooled in order to off-set currency losses elsewhere.
The Principal Investigator is responsible for the technical and financial management of the grant. This includes ensuring that the grant complies with the funder’s terms and conditions and fulfils reporting requirements. Any significant project changes (for example, change of personnel or change to budget allocation) should be discussed with the funder in a timely fashion.
Responsibility for day-to-day management of project finances can be delegated to Project Administrators (this should be reflected in the authorisation rules for the grant). Nevertheless, overall accountability for the project remains with the PI, who is in turn accountable to the Head of Department.
- Expenditure must be incurred between the agreed project start and end date
- Expenditure must be in accordance with the funder’s terms and conditions
- Expenditure must be in accordance with the awarded budget
- Expenditure must be in accordance with the School's own Financial Regulations
- Purchases must be charged directly to the grant for which they are intended
- Exceptional cases, or amendments to the budget, must be approved by the funder prior to actual expenditure
NOTE that funders may refuse to reimburse costs that are incurred outside the approved budget and grant terms and conditions. Ineligible costs that are charged to the grant but not reimbursed by the funder will be charged to the PI’s Department.
Virement (transfer) of budget funds
Many funders allow the transfer of funds between budget headings within certain limits. It is the responsibility of the PI and Project Administrator to clarify the virement rules for each grant (details should be in the funder’s terms and conditions).
Expenditure is permitted within the virement limits set by the funder. If these are insufficient, the funder must be contacted and written approval obtained to permit a formal re-allocation of the budget.
The ROO team will then re-load the grant budget in line with the new agreement between the PI and the funder.
Invoicing the funder
It is the responsibility of the ROO team to reconcile the grant account on a regular basis and submit invoices and financial statements to the funder in accordance with terms and conditions.
Some funders make payments on a regular basis; others pay against milestones (such as interim project progress reports). In these cases, it is the responsibility of the PI to ensure that these non-financial reports are made available to the ROO team in good time.
End of Project Financial Statements
Financial statements are produced jointly by the ROO team and the Project Administrator and must be reviewed by the PI prior to sign-off and submission to the funder. Late submission may lead to a financial penalty, such as non-payment of the final invoice.
It is the responsibility of the PI to review financial statements promptly and ensure they are approved in time for submission within the funder’s time scale. Financial penalties that result from delays by the PI will be charged to the PI’s Department.
Interim and Final Scientific Reports
Non-financial reporting must take place in accordance with the terms of the grant. Some funders only require a final report but others request interim reports as well.
If the scientific report includes any financial information, the PI must ensure that the ROO team checks the figures to ensure they are in line with interim or final financial statements.
Most funders set deadlines for the submission of both financial and scientific reports. It is the PI’s responsibility to meet these submission dates and to report any likely postponement to the funder in good time. Financial penalties that result from delays by the PI will be charged to the PI’s Department.
Collaborators and subcontractors
Many grants led by LSHTM involve Co-investigators and researchers from other research institutions (in the UK and overseas). These research partners are defined as collaborators. Sometimes LSHTM will contract out a service to a third party subcontractor (for example, some types of lab work, web design, large-scale surveys).
In both cases, it is the responsibility of ROO to set up a suitable subcontract to cover the financial and contractual relationship between LSHTM and the collaborator or third party subcontract. This will cover:
- Contractual terms and conditions
- Budget details
- Invoicing arrangements
- Financial reporting
- Any obligations to the main funder
The grant cannot be closed until the PI, Project Administrator or Departmental Administrator has confirmed that:
- The final scientific report has been submitted to the funder
- Overspends have been cleared
- Underspends have been dealt with in accordance with the funder’s terms and conditions
- Disallowed costs have been cleared
- Open purchase orders have been closed
ROO will alert the PI and DA ninety days in advance of the end date of the project to ensure there is sufficient time to review the grant account and make necessary adjustments.
Most funders reimburse costs based on actual expenditure incurred. If expenditure at the end of the project is less than the total budget value then there is an underspend and the funder will not reimburse the full budget. If the funder has transferred more funds than have been spent on the project, then the School may need to return any unspent funds to the funder.
Funders of this type include charities, UK Research Councils, European Commission and some UK government departments.
Commercial funders, and funders that regard researchers as ‘consultants’, reimburse costs against milestones or fixed price instalments instead of actual expenditure. These budgets will be reimbursed in full as long as the PI meets the deliverables set out in the contract.
Funders of this type include private sector funders, DFID and international agencies, such as WHO.
Any expenditure incurred after the end date of the project, or disallowed costs (considered to be ineligible by the funder) must be removed from the grant account by the PI or the Project Administrator.
The ROO team will liaise with the PI or PA to ensure that this happens in a timely fashion. However, if there is a significant delay, the ROO team will charge the Departmental account with any outstanding costs so that the grant can be closed and archived.
ROO is responsible for managing the transfer of grants to or from LSHTM. Transfers must be approved by the Head of Department. It is the responsibility of the PI to inform the Head of Department and Research Operations Office as soon as possible of a transfer.
The time taken to transfer a grant depends on both the funder and the complexity of the award.
Extensions and supplements
- No-cost extension
The funder agrees to extend the end date of the project but no additional funding is provided. The PI must inform their Project Administrator and ROO team when the funder confirms a no-cost extension. The position of staff employed from the grant must be clarified as there may be insufficient funds to extend their contracts in line with the new project end date.
- Cost extension
The funder agrees to extend the end date of the project and also provides additional funding. The PI must follow LSHTM procedures and set up a pFACT proposal to show how the additional funds will be spent. The pFACT proposal must be approved in the usual way.
The funder provides additional funding to an existing project and the end date does not change. The PI must follow LSHTM procedures and set up a pFACT proposal to show how the additional funds will be spent. The pFACT proposal must be approved in the usual way.
Quality Assurance and Audits
Funders expect their funds to be spent in a cost-effective manner. In particular, expenditure must be incurred in accordance with the funder’s terms and conditions. In general, costs are eligible if they were included in the proposal and were subsequently awarded.
Responsibility for the day-to-day management of the grant may be delegated to Project Administrators. Delegated staff are then responsible for ensuring that grant funds are properly spent (in accordance with the funder’s terms and conditions) and that expenditure takes place within the agreed start and end dates of the project.
Overall accountability for the project lies with the PI, who is in turn accountable to the Head of Department.
Any funder may decide to conduct an audit to ensure that LSHTM’s financial procedures are robust and that specific research projects are being run in accordance with the terms and conditions specified in the award.
EC FP7 projects will require an audit in all cases where the EC contribution to the LSHTM project team reaches €375,000. A charge for the audit cost should be included in the LSHTM budget.
Smaller FP7 projects may not require an audit certificate from the funder, but the Consortium may decide that one is required. In these cases, audit costs are considered to be ineligible by the funder and will have to be reimbursed by the PI’s Department.
All of the School's research activity is also subject to review by its own internal and external auditors.
Staff recruitment and management
Staff issues are primarily a responsibility of the Human Resources Department. However, some aspects of staff management have an impact on grant expenditure and control.
- Advertisements to recruit new staff for a project must follow Human Resources procedures. The cost of advertising can be charged to the grant account, providing it is an eligible cost and is included in the budget.
- Named researchers may transfer from other institutions to work on a project and are paid on an LSHTM payscale. The PI should ensure that the researcher’s CV is sent to Human Resources Department together with the researcher’s new job description. Human Resources will then indicate the likely grade and spine point that will be allocated to the researcher. Note, however, that this must eventually be formally confirmed by the HERA process prior to appointment.
Eligibility to work in the UK
- All employees must provide evidence of their eligibility to work in the UK before they are appointed.
- UK and EU citizens may simply present their passports but citizens from other countries may need to present supporting documents.
- Some funders will reimburse the costs of maternity/paternity leave. The PI should inform the funder and ROO as soon as possible so that the position can be clarified.
- Some funders will not reimburse costs but are willing to extend the end date of the project instead.
Long Term Sick Leave
- Some funders may be prepared to stop the project temporarily until the member of staff is able to return to work. The PI should inform the funder and ROO as soon as possible so that the position can be clarified.
Change of staff
- Some funders wish to be informed about all staff changes and some may wish to approve changes in advance. Others consider staff matters to be the PI’s responsibility.
- The PI should usually inform the funder (and ROO) if a member of the project team leaves in advance of the grant end date and needs to be replaced.
- If a member of the project team is promoted to a new grade unexpectedly there may be implications for the budget. Before informing the funder, the PI (and ROO) must quantify the impact the promotion will have and consider whether the additional cost can be absorbed within the current budget.
Health and safety
- As line managers for project staff, PIs must ensure that work is carried out safely.
- PIs should carry out risk assessments for all projects which involve clinical trials, lab work and/or travel to high-risk countries.
- School staff are not permitted to travel to locations where the UK Foreign and Commonwealth Office (FCO) advise against all travel. Travel to locations where the FCO advise against "all but essential travel" is considered on a case by case basis. If a project will require School staff to work or travel overseas, the PI should consult the FCO web-site before submitting the proposal for approval and before each trip. Staff must not travel unless they have received formal approval from the School.
- Check with Finance Department to ensure appropriate travel and medical insurance is in place.
- Check whether charges for travel abroad, medical insurance and allowances for staff located overseas are considered by the funder to be eligible costs.