Stewardship and Compliance
for Stanford PIs

WORDING OF THE
PI'S CERTIFICATION OF
PROJECT EXPENDITURES

 

The Principal Investigator's certification of project expenditures is a key piece of documentation supporting the allowability, allocability and reasonableness of project costs. Particularly for salary charges, this certification is the primary evidence that the salary being charged was supported by a corresponding degree of effort devoted to the project.

The wording of this certification is as follows:

To the best of my knowledge, salary and wages charged to this project are appropriate in relation to work performed on this project. All other costs charged to this project are, to the best of my knowledge, appropriate. Where required, corrections have been or will be made through the accounting system.

See the July 2005 memo from the Dean of Research for further explanation of the importance of this internal control and of the possible consequences if expenditures are NOT certified.

Here is an analysis of key components of this internal control:

Review

Monthly Expenditure Statements must be REVIEWED before they are certified. Typically, someone in the department goes through each statement to reconcile expenditures and check for errors, and that individual will initial the statement as a record of that review. Any accounting errors or other questions about the appropriateness of particular expenses should be brought promptly to the PI's attention for clarification or correction. (See Expenditure Review Checklist, will open in a separate browser window.)

Best
Effort

The PI certifies TO THE BEST OF HIS OR HER KNOWLEDGE. A-21 acknowledges that precision in these determinations may not be possible, and we therefore rely on the PI's BEST ESTIMATES.

Appropriate
Charges

The PI certifies that salaries and other expenses charged to the project, e.g., materials, supplies, travel, and any other expenditures, are APPROPRIATE. In accordance with the cost principles of Circular A-21, these charges are allowable, allocable to the project, and reasonable, i.e., the amount paid for them was what a prudent person might be expected to pay.

Effort
Over Time

The PI certifies that salaries charged to the project are reasonable in relation to work performed on the project. While month-by-month levels of effort may fluctuate, over the quarter being certified, salary charges are reasonable in relation to work performed.

The certification of salary charges must be based on work performed - not on work expected to be performed. If an individual has not worked on a project, salaries may not be charged on the expectation that they will be earned in the future.

Correcting
Errors

The PI certifies that differences have been or will be corrected THROUGH THE ACCOUNTING SYSTEM. Staff will correct any errors by means of journals from one account to another, based on information provided by the PI. Journals should be initiated as soon as possible after an error is identified, and should be well documented. In particular, the journal should include a specific statement about the benefit to the project being charged. Without this statement, a reviewer might assume that an expense was moved for budget reasons, and not for project-related technical reasons.

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