Office of Sponsored Research - 500.14 - Cash Advances

Purpose

Cash Advances are required to allow business to be conducted in specific situations. It is necessary to determine the acceptable circumstances to use this process and the methods by which they must be managed.

Policy Statement

The University can advance cash for activities related to a sponsored project utilizing unrestricted University funds. Cash Advances are to be made only for business expenses incurred by, or on behalf of, an employee in their capacity as such. The Cash Advance is reconciled to project funds once the cash has been utilized and the expenses are reviewed for allowability. Advances are strictly limited to two types of activities: circumstances requiring cash payments of dollar amounts that are too small to justify the use of an imprest bank account and are intended for a one-time purpose and short periods of time; or, providing advanced funds to collaborating institutions unable to support a system of cost-reimbursement payments.

These types of payments are only for business expenses incurred by or under the supervision of employees in their capacity of completing work on behalf of the University. The request for a Cash Advance must be authorized by the Principal Investigator (PI) or their designee. Examples of such types of expenses include study subject compensation, extended field work in remote locations, certain travel expenses, collaborating institutions requiring advanced payment, and other exceptional circumstances.

The Cash Advance process is owned by UNC Finance Division (Finance). However, any advances involving a sponsored project require additional oversight by the Office of Sponsored Research (OSR). For policies on non-sponsored project Cash Advances, please see the Finance Policies and Procedures Manual.

Expectations of Cash Advance Management

  • All advances for domestic use must be reconciled within 60 days after receipt of the advance.
  • All advances for foreign use must be reconciled within 90 days after receipt of the advance, unless required sooner for reporting purposes.
  • A project may only request a third advance if the other advances are in compliance with this operating standard.
  • Advances to a third-party institution or University foreign facility should not exceed two (2) months of that institution’s operating cash required for the project.
  • Advances must be reconciled in a timely manner after the end date of the project as required by the reporting requirements of the agreement and OSR.

I. Cash Advance Request

Requests for a Cash Advance are created by selecting the appropriate transaction based on the method of payment. Options include a voucher transaction and wire transfer. A payment is then provided leveraging unrestricted non-project resources. The advance is made payable to an individual or institution and is considered a loan.

The requestor and the project’s PI are responsible for management of open Cash Advances. All required documentation for the transaction must be submitted with the request. Projects are limited to three (3) open Cash Advances at a time. Additional advances will only be approved once one of the three (3) outstanding Cash Advances has been reconciled.

II. Cash Advance Reconciliation

Reconciliation is the responsibility of the Departmental Administrator (DA), PI, and the recipient of the Cash Advance. Open advances are reconciled once the funds have been spent and the open advance had been reconciled in the University’s financial system. Cash advances reconciled to sponsored projects must be for expenses that are allowable and incurred during the period of performance of the project to which it is charged.

The department must provide documentation for the use of the cash, detailed receipt information for the expenses, and any other required documentation. Any unspent cash is to be returned to the University during this process. OSR reviews the documentation and transaction details to confirm that expenses meet all applicable regulations regarding allowability. OSR pre-audit technicians provide the final approval for the reconciliation transaction. If approved, the Cash Advance expenses are reconciled to the correct expense account, and the advance is closed.

The department is responsible for maintaining gift card disbursement logs to support all gift card expenses charged to sponsored projects via cash advance reconciliation. Logs should contain information such as study subject identification number, date of gift card distribution, amount of gift card, gift card identification number, as applicable.

Related Requirements

Unit Policies, Standards, & Procedures

Contact Information

For questions regarding this operating standard and its related procedure, please contact ResAdminOSR@unc.edu.

For questions regarding Pre-Award management or Post-Award administration, please contact the assigned Sponsored Project Specialist (SPS).

For invoicing, reporting and other financial matters, please contact the assigned Sponsored Projects Accountant. OSR Staff assignments are found in RAMSeS or on the OSR website.

History

12/4/2020 Revised to clarify reconciliation of advances during performance period and include documentation requirements for gift card disbursement logs.
05/15/2018 Revised to coincide with the release of the new OSR Website.
02/28/2018 Revised operating standard to clarify reconciliation expectation of foreign advances and to allow for a third advance.
08/28/2017 Revised operating standard to clarify expectations of cash advance management, updated hyperlinks to Procedures and Related Operating Standards, and Contacts.
01/06/2011 Revised policy to clarify authorization required by Principal Investigator.
05/30/2010 Revised policy to conform to Finance Division newly revised Policy 307 – Cash Advance.
12/22/2009 Revised policy to include the compensation threshold that must be reported to Accounting Services.
09/04/2009 Changed title of policy from Compensation for Study Subjects to Cash Advances to reflect additional types of requests for advances.

The operating standards in the Office of Sponsored Research Operating Standards & Procedures Manual supersede any OSR operating standards, procedures and appendices previously included in the University Business Manual, a publication of UNC-Chapel Hill’s Division of Finance.

Details

Article ID: 132318
Created
Thu 4/8/21 9:28 PM
Modified
Fri 4/23/21 10:44 AM
Effective Date
If the date on which this document became/becomes enforceable differs from the Origination or Last Revision, this attribute reflects the date on which it is/was enforcable.
12/04/2020 1:53 PM
Issuing Officer
Name of the document Issuing Officer. This is the individual whose organizational authority covers the policy scope and who is primarily responsible for the policy.
Issuing Officer Title
Title of the person who is primarily responsible for issuing this policy.
Distinguished Professor
Last Review
Date on which the most recent document review was completed.
12/04/2020 1:53 PM
Last Revised
Date on which the most recent changes to this document were approved.
12/04/2020 1:53 PM
Origination
Date on which the original version of this document was first made official.
07/01/2008 12:00 AM