suggest updates to this page

What is a deficit project?

A deficit project is created by RCA when an award has ended and all close out financial accounting of expenditures has been implemented, and expenses in excess of the award budget remain.  This has been previously referred to as a 'write off'.  Please note that any overspend less than $10 will not require a deficit project.  RCA will reduce the F&A in that amount. 

When is a deficit project used?

During award close out (see Award Close Out section) and all actions have been taken to manage expenses, any remaining overspent funds can be addressed through the creation of a deficit project. RCA creates a deficit project and moves the overspent direct costs to this project which will need to be funded by department source of funding.  These costs will be accounted for and reported as uncommitted cost-share.  You can see the deficit project in the SPFF Dashboard with the same title as the original project but preceded with the word 'Deficit-'.  Your original project will now have a balance of $0 while the Deficit Project will show the overspent costs in its actuals.

A balance transfer will be required to fund these costs.  The balance transfer will be a movement from funds in a department fund source to the deficit project's COA in the General Ledger.  For the deficit project, the fund type is 101 (unrestricted designated) and the fund source is 012100 (cost share).  Account code 8345 for Miscellaneous costs is used. You will see the deficit project in the Finance Dashboard General Ledger with COA as 10.101.012100.8345. 

What is the process?

1. Submit a help ticket in iO (non-billable projects). 

2. RCA will create a new project within the award.

1. • Project name will include “Deficit”.

   • Duration will be the same as award.

   • Project will have Internal funding source (balance transfer required).

   • F&A rate will be 0%.

   • Budget will be set up for overage amount.

   • RCA will process cost transfer to move direct portion of overage to new project, using expenditure type ODC: Excess Costs.

3.  Submit a balance transfer form from a department (non-sponsored research) fund source to the deficit project COA. 

Additional considerations

The source for funding the deficit project should be from department funds and cannot originate from sponsored research funds or funds with restrictions that disallows usage for this purpose.  Efforts to manage expenditures on the award including cost transfers or labor distributions should be considered as a first priority to ensure all intended expenses are processed on the award.  

Additional Resources

Templates, Tools, and Job Guides

1. Job Aid, 'Balance Transfer', https://rice.app.box.com/s/h2ge4sp90act2gm00p4j8xq93nuvhlfc 

2. Chart, 'Frequently Used Fund Types', https://rchcostacctng.blogs.rice.edu/2022/07/15/frequently-used-fund-types-and-fund-sources/.

Policies & Regulations

1. RCA Protocol, 'Award Close Out', https://controller.rice.edu/rca-award-closeout

2. RCA Protocol, 'Award Close Out Timeline', https://controller.rice.edu/rca-closeout-timeline

3. RCA Blog protocol, 'Non-billable Projects', https://rchcostacctng.blogs.rice.edu/2022/07/15/non-billable-project/ 

Training Materials

1. Type, 'Name' (date), link url

2. Type, 'Name' (date), link url

University Announcements

1. Type, 'Name' (date), link url

2. Type, 'Name' (date), link url

FAQs, RADAR forum threads

1. Type, 'Name' (date), link url

2. Type, 'Name' (date), link url