1. Webinar - SUBMITTING AN ERROR-FREE SBDC BUDGET:
OSBDC Budget Training for SBDCs
June 3, 2014
Webinar - SUBMITTING AN ERROR-FREE SBDC BUDGET:
How to Avoid Common Budget Mistakes That May Delay Your Notice of Award
Good afternoon and welcome to our “Submitting an Error-Free Budget” presentation. This year we have tried to cast a wide net to include any and all people involved with the SBDC budget preparation, be it staff at the lead and service centers; the host financial staff; and/or staff in respective Offices of Sponsored Programs. We do this to acknowledge and include the multi-level, multi-site preparation that migrates from office to office in order to pull together a cohesive SBDC budget.
Our presentation is based on information gathered from our Grants and Program Management staff. We identified the most common and most time-consuming errors and created a few graphics that offer solutions to these common errors that we find in our budget reviews. This presentation will move at a fast clip in order to leave time for a question and answer period, and consists of many slides. While having a staggering amount of slides is looked upon as poor public-speaking protocol, this is a deliberate effort to leave you with a reference handbook after the presentation. This presentation will also be recorded and distributed to the SBDC State Directors.
We want to acknowledge to all of you that SBDC budgeting is unlike most federal grant budgeting: Our unique ways of formulating the SBDC budget request is driven by our statute and regs, and also by our own internal SBA forms which simplify the labor-intensive grants processing. So we ask your forbearance in advance as we go through each of these processes. One caveat up front: You are not REQUIRED to use any of OSBDC’s budgeting forms aside from the SF 424 and the SF 424A. However, if you do decide to use our forms, we can promise a speedier correlation, review and resolution between all documentation.
The webinar today will consist of the following areas related to the SBDC annual budget proposal:
Registration, Updates, Uploads and Payments
Some Overall Budget tips or “Generic Common Errors”
6 Common errors for the SF424
9 Common errors for the SF424A
10 Common errors on Budget Justification Worksheets
Indirect Cost Errors; and
Cross-Walking the numbers

2. BEFORE WE BEGIN:
By now, all SBDCs that were registered in the CCR have been migrated to SAM, the System for Award Management. So we assume that you must have received s for creating a new user account in SAM and have been informed that all updates must be entered into the system. The SAM and Grants.gov interact with each other during your proposal upload, and it is of utmost importance that all information is correct - and cross-references correctly - in BOTH systems.
Here is a screen shot of the training PPt on Grants.gov’s home page. Instructions are very user-friendly and they also have a video.
Important: Note that the time it takes for registration and updates in each system as well as the time it takes for validation.
Rule of thumb: Register early. Update early. And upload early.

3. Before We Begin…….
Very Important!
Pre-registration/Updating in SAM (System for Award Management):
Your SF 424 Applicant Information in in your Grants.gov upload and SAMS information must match: Legal address, organizational DUNS number, and Employee Identification Number (EIN), also known as the Tax Identification Number (TIN).
You must update your applicant information in SAM.gov prior to your submission to Grants.gov. Unmatched information between the two systems will cause upload errors/failure on Grants.gov
The DUNS and TIN in SAM must identify the same legal name and address on your Application (SF424), even when the company is Doing Business As under a different name.
We at OSBDC have experienced the failure of Grants.gov uploads as well as payment failure in Denver with some recipients.
Therefore we are asking that you follow these steps carefully, and ensure that your DUNS, EIN and/or TIN numbers correlate to your legal name and address in SAM; your Grants.gov application (SF 424); and your host’s Grants Award and Financial Systems.
Unmatched information between the two systems will cause upload errors/failure on Grants.gov

4. Before We Begin…….
Very Important!
Pre-registration in SAM (System for Award Management) for DBA Applicants:
The DUNS and TIN in SAM must identify the same legal name and address on your Application (SF424), even when the company is Doing Business As under a different name.
If an entity has sub-entities under its purview, the DUNS, legal name, EIN and TIN must submit at the applicant-specific (sub-entity) level, not at the parent (entity) level.
We have reserved a special slide Doing Business As (DBA) applicants.
These are usually State hosts, Board of Regent hosts, and University Extension hosts)
We won’t dwell on tips here, but these hosts should pay particular attention to this slide.

5. Before We Begin……. Very Important!
Your ACH Vendor/Miscellaneous Payment Enrollment Form:
Must show the same Payee/Company Information as the legal name on the Application (SF 424) and Notice of Award
You may be required to submit a tax exempt form issued by the IRS to substantiate the legal name and TIN on the application.
OSBDC’s Grants Awards System and Financial Accounting System must be updated with the information in SAM prior to OSBDC issuing your Notice of Award. Unmatched information between all systems will cause failure/delay of payment.
Payment Documentation: SBA’s Denver Finance System requires consistency in your payment documentation:
Your ACH Enrollment Form information must match the information in SAM; OSBDC’s Grants Award Systems (which consists of ORACLE and PRISM); and your host’s Financial Systems.
Unmatched information between all systems will cause failure flagging and delay of payment from Denver.

6. Overall Common Errors
Error #1: Documents are Unprintable and/or Unreadable. (Runaway printing from improperly set margins.)
Data is not organized to fit on a single page or prints outside the margins. Fonts are too small to read.
If we can’t see it, we can’t review it.
Solution: Paginate to print out in a readable format. We will request re-submission of documents if improperly formatted.
So now let’s begin: At this point we present four generic common errors found throughout SBDC budget documentation before we go into specific forms. We also graphically point out where they occur and the solutions. The first of these has to do with pagination. Theoretically, unprintable documents should not be a problem, as you, the SBDC, must paginate and print out most of these documents for your Program Manager and District Office review prior to upload.
Here at the OSBDC office, OMB Circular directives require the Grants Management Specialists to keep the official legal grant file in hard copy, so we print out the downloaded proposal from Grants.gov
For your Grants.gov upload, please paginate for readable printing with fonts no smaller than the equivalent of Arial 11point. This is particularly necessary for Budget Justifications.
Improperly formatted documents must be resubmitted.

7. Overall Common Errors Error #2: Incomplete Budget Submission
Solution: Confirm all forms are attached and error-check calculations before uploading to Grants.gov.
A complete submission includes these documents, correctly filled out:
SF 424 “Application for Federal Assistance”
SF 424A “Budget for Non-Construction Programs” for entire SBDC network
SBA’s Budget Justification Form for Lead Center and each Service Center OR
- 424A for the Lead and each Service Center AND
- your own budget justification format that includes all information required in SBA’s Budget Justification instructions
Personnel List for all persons charged to the Cooperative agreement: Names, titles, federal and match share of annual salary, salary rate, # of months, % of time
Current Indirect Cost Rate Agreements for Lead Center and each Service Center
Schedule of Indirect Costs
Error #2: Incomplete budget submission
A complete budget submission consists of the following: SF 424, SF 424A, Budget Justification Worksheet with details OR additional 424As with details; Personnel List; CURRENT Indirect Cost Rate Agreements; and a Schedule of Indirect Costs.
Please refer to the current program announcement which highlights all necessary forms for both single-year and multi-year applicants.

8. Overall Common Errors
Error #3: Budget Does Not Clearly Identify the Service Center it Covers Throughout the Various Documents
Interchanging the names of Service Centers across the Budget Justifications, Schedule of Indirect Costs, Network Listing, Org Chart, etc. This makes it nearly impossible to review information from one document to another and leads to inefficient follow up communication.
Solution: Be consistent on all proposal documentation.
For Service Center Budget Justifications, use Host Institution’s name FIRST, then the SBDC’s “branded” name.
Avoid acronyms and “place” names
Error #3: Service Center Names:
We need consistency in lead and service center names throughout the proposal and are asking that both the Host Institution’s name, followed by the SBDC’s “Branded” name be used throughout.
OSBDC staff must cross-check most documentation. Shifting from service center “location” or “regional” names such as “Region 3” on one document - to the formal service center name on another “Northwest Minnesota SBDC” on another - renders correlation impossible.
Please also remember that Program Managers have inherited new portfolios and aren’t familiar enough to connect the dots yet.

9. Examples of Clearly Labeled Service Centers
Host Institutions followed by SBDC Name
Bemidji State University - Northwest MN SBDC
The Alliance – Modesto SBDC
The Alliance – Merced SBDC
Women’s Economic Ventures - Mountain Communities SBDC
University of Plattsburgh - North Country SBDC
Ivy Tech Community College - Central Indiana SBDC
University of MN Duluth - Northeast MN SBDC
California State University (CSU)Bakersfield - Bakersfield SBDC
PLEASE BE CONSISTENT WITH YOUR SBDC HOST NAMES AND BRANDED NAMES
So here are samples of correct service center documentation: Host institution name followed by the “branded” SBDC name.
From a quick review of the centers listed here, you can guess how confusing it can become if both names are not included.
The same naming format should be on your Budget Justifications, Schedule of Indirect Costs, Network Listing and Org Chart.
Just as an FYI - this was one of the highest rated pet peeves for both Grants and Program staff….

10. Overall Common Errors
Error #4: Totals Don’t Add Up: Amounts on SF 424 are Inconsistent with SF 424A and/or Budget Justification Worksheet Totals
Solution: Cross-check budget totals on all documents in your application.
SF 424
SF 424A
Budget Justification
Cash Match Certification
Schedule of Indirect Costs
Documents with variances will be returned to the applicant for correction, which delays SBA’s issuance of your Notice of Award.
Generic Common Error #4: Totals don’t add up
One of the first things your Project Officer and Program Manager will do is to conduct a generic cross-walk on your Network SF424 and Network 424A to see if they square.
If they don’t, your budget will immediately be set aside, and you will be asked to re-submit a correction.

11. Federal Share of SBA total
SF 424A
SBA Funding
CASH MATCH
IN-KIND
INDIRECT
TOTAL
So for the Cross-Walk: The total federal portion of your budget, Column 1k on your Network 424A……
Consultants
Col 1k =$100,000
Federal Share of SBA total

12. SF 424 “Application for Federal Assistance”
Federal Share (SBA)
…..should equal the federal share on your Form 424, (Block 18a)

13. Col 2k, 3k, and 4k = $500,000 = Non Federal Match
SF 424A
SBA Funding
CASH MATCH
IN-KIND
INDIRECT
Col 2k, 3k, and 4k = $500,000 = Non Federal Match
Consultants
TOTAL
Similarly, Columns 2k, 3k and 4k on your Network 424A – which is Your Cash, In-Kind and Indirect, in other words, your total SBDC match – should equal……

14. SF 424 “Application for Federal Assistance”
18 b, c, d, e =
= $500,000 = Non Federal Match
…..Box 18, b through e on your SF 424.
In other words, Total SBDC Match on both documents should square.
Finally the sum totals in both documents should square. Hence Block 18g in the 424 should equal…..
18g=$600,000

15. SBA Funding
CASH MATCH
IN-KIND
INDIRECT
Consultants
TOTAL
……….Column 5k on your Network 424A.
Also cross-check that the sum of your lead and individual service centers square with the totals of your 424 and 424A.
Neither you at SBDC nor we at OSBDC pass GO or collect two hundred dollars if this Cross-Walk doesn’t square. If it doesn’t, at this point your budget will be returned and you will be asked to correct it.
This is our initial cross-walk. There will be others throughout the presentation.
Col 5k total = $600,000 = Row g of your SF 424 and the Total of your Budget Justification Worksheet
Do your individual service center budgets add up to the total in your Budget Justification? Does this total match totals of your 424 and 424A?

16. 6 Common Errors on the SF 424 (Application for Federal Assistance)
Error #1: Block 5b has incorrect Federal Award Identifier.
Solution: Use award number from Block 2 of previous year’s Notice of Award. PRISM has generated new numbers.
Presenting the SF 424: 6 Common Errors:
On the next few slides, we’ll concentrate on the Application for Federal Assistance, your SF 424.
The first two errors include the Federal Award Identifier, and Congressional District, and are just reminders to pay attention to filling in these blocks:

17. SF 424 - Application for Federal Assistance
Error #1: Solution: Use award number from Block 2 of previous year’s Notice of Award
For the Federal Award Identifier, Use the award number form your previous Notice of Award in 5b.

18. 6 Common Errors on the SF 424 (Application for Federal Assistance)
Error #2: Congressional District, Block 5b, is either not completed or incorrect.
Solution: Double check. The correct number is required for uploading to the USA Spending database.
Error #3: Block 18, Lines b – e Estimated Funding is left blank or lumped into “Applicant.”
Solution: Complete and break out the match into correct categories.
Error #4: Block 18, line f “ Program Income” in Estimated Funding is filled in and included in the “Total,” Line g.
Solution: Leave “Program Income” BLANK.
Error 2: Congressional District is not completed or incorrect.
Error 3: Estimated funding is left blank or lumped into “Applicant.”
Error 4: Program Income is filled in.

19. SF 424 - Application for Federal Assistance
Error #2: Solution: Double check. Must be correct for USA Spending database.
Error #3: Solution: Break out match by Source (Applicant, State, Local, Other)
This total will be incorrect if 18f, “Program Income” is filled in.
Here are your solutions:
For Error #2, just double check and fill in the number of your Congressional District
And focusing on the Estimated Funding, Block 18:
For Error #3, we tend to see a lot of lumped, aggregated numbers here in the non-federal match lines, 18b through e. Please break out your match source by Applicant, State, Local Match, and Other.
For Error #4, VERY IMPORTANT: Leave Program Income, 18f BLANK, otherwise the total will be incorrect. If filled in it may also incorrectly populate your SF 424A.
Error #4: Solution: LEAVE BLANK

20. 6 Common Errors on the SF 424 (Application for Federal Assistance)
Error #5: SF 424 not signed by correct designated Authorized Organization Representative (AOR). It is not dated.
Error #6: Revised SF 424 submitted without signature or date.
Solution: When Form 424 is revised or corrected, it must be signed and dated again.
Error #5 and #6: The form is not signed by the AOR, nor dated. And revisions to the SF 424 are not signed and dated by the AOR.
The Authorized Organization Representative, or AOR, on file with SAM and OSBDC, is the only one who should sign the SF 424.
Be sure it is dated.
And finally, for Error #6, remember to have your AOR sign and date any revisions to the Form These revisions should be ed to us.

21. SF 424 - Application for Federal Assistance
Solutions:
The Authorized Organization Representative, or AOR, on file with SAM and OSBDC, is the only one who should sign the SF 424.
Be sure it is dated.
And finally, for Error #6, remember to have your AOR sign and date any revisions to the Form These revisions should be ed to us.
Error #5: Solution: Must be signed and dated by the Authorized Organizational Representative (AOR).
Error #5a: Solution: Must be SIGNED.
Error #5b: Solution: Must be DATED.
Mistake #6: Solution: If revision is needed after initial Grants.gov submission, AOR must sign and date revised form

22. 9 Common Errors on the SF 424A (Budget for Non-Construction Programs)
Error #1: Section A rows and Section B columns incorrectly labeled or not labeled at all for the SBDC Program.
Solution: Type labels in Section A lines 1 – 4; these populate Section B columns 1-4. “SBA”, “Cash Match”, In-Kind”, and “Indirect.” In that order.
Error #2: Section B, line g: “Construction”
Solution: If the 424A shows “Construction” on line g, cross it out and write “Consultant.” Put consultant costs on line g.
Error #3: Section B Columns 2, 3 and/or 4 (Non-federal) are incomplete or incorrect.
Solution: Show breakout of Cash and In-Kind by line-item in Column 2 and 3. Show Indirect Cost in Col 4 line j.
Moving on to the SF 424A: Its nine most common errors
The first three common errors comprise incorrect labeling and incorrect allocation:

23. #3 Columns in Proper Order
SF 424A – Budget for Non-Construction Programs
SBA Funding
CASH MATCH
IN-KIND MATCH
INDIRECT
TOTAL
Consultants
#2 Replace
#1 Fill in.
#3 Columns in Proper Order
When you see the 424A on Grants.gov, you will fill in the first four rows in the upper left hand corner of the form IN THIS EXACT ORDER: 1) SBA Funding, 2) Cash Match, 3) In-Kind Match, and 4) Indirect. These in turn will populate the columns beneath sequentially.
While you may not be able to do this on Grants.gov, replace Row g, labeled “Construction” with the label “Consultants” on your hard copy. This will help to keep your allocable costs in the correct category.

24. 9 Common Errors on the SF 424A (Budget for Non-Construction Programs)
Error #4: Cash Match requirement is not met and/ or does not correspond to your Cash Match Certification.
Solution: Ensure that cash match total on line K, column 2 is 50% or more of the total federal share (Section B, line K, column 1). Ensure that your Cash Match Certification form is equal to or greater than minimal cash match requirements.
Error #5: Match funds budgeted for Service Center indirect costs are included in the Cash Match total (column 1).
Solution: Cash match column can only include cash match used for Direct costs. Use column 4. line j for non-federal indirect.
Errors #4 and #5 concern Cash Match.
In Error #4, the cash match is not met, and
In Error #5, sometimes we find unintended indirect costs allocated to this column.

25. SF 424A – Budget for Non-Construction Programs
SBA Funding
CASH MATCH
IN-KIND
INDIRECT
1. SBA Funding
2. CASH MATCH
3. IN-KIND
4. INDIRECT
5. TOTAL
Mistake #4: Solution: Cash Match total should be 50% or more of SBA Total on Line 6k Col 1
Mistake #5: Solution: Only put cash for Direct Costs in the Cash Match column.
Consultants
SBDC Regs stipulate that 50% of the SBDC’s total match must be in cash. The cash match requirement can only be met with cash that is used for Direct Costs.
Follow the formulas in this graphic to conduct a quick check to verify you satisfy the minimal level of cash match.
Finally, do a quick cross-check. Is your Certification of Cash Match at the minimal acceptable level for the cash match requirement?
Is your Cash Match Certification form equal to or greater than the minimum allowable cash match?
X=Total Federal Share
≥ 50% of X (6k Col 1)

26. 9 Common Errors on the SF 424A (Budget for Non-Construction Programs)
Error #6: Indirect cost charged to SBA exceeds maximum allowable amount (20% of SBA Funding).
Solution: Federal share of indirect costs (Col 1 Line J) cannot be more than 20% of SBA funding (Col 1, Line k).
Error #7: Indirect costs allocated to wrong Columns or Lines.
Solution: Indirect costs covered by non-federal match should only be shown in col 4, line j. All indirect costs (charged to federal, waived, etc.) must be shown ONLY on line j. Only Columns 1, 4 & 5 may have indirect cost entries on line j.
Error #8: Indirect cost total does not balance with other docs. D
Solution: Totals should square with totals on Schedule of Indirect Costs worksheet and the Budget Justification
Errors six through eight all have to do with indirect cost. SBA’s Regs stipulate that reimbursement of indirect costs charged to federal funds will be capped at a maximum of 20%. We also find that indirect costs, Line Item J, are found in the incorrect columns. Finally, indirect cost totals on your 424A should square with the totals on your Schedule of Indirect Costs.

27. SF 424A – Budget for Non-Construction Programs
SBA Funding
CASH MATCH
IN-KIND
INDIRECT
1. SBA
1. SBA Funding
2. CASH MATCH
3. IN-KIND
4. INDIRECT
4. Indirect
5. TOTAL
Mistake #7
Indirect Cost in In-Kind Match column. Solution below:
Mistake #7
Indirect Cost in Cash Match column Solution below:
Indirect costs belong in these boxes ONLY
Mistake #6
Solution:
Indirect Cost ≤ 20% of SBA Funding
So here you have it: Your federal Indirect Costs (Line J, Column 1) ≤ 20% of Line K Column 1 (the Totals line)
Line J, Columns 2 and 3 should be BLANK. No exceptions!
And Line J, column 4 should include all the indirect NOT included in the federal portion.
So in a nutshell: There are only TWO places you can place Indirect Costs, either in the Federal Column, or in the Indirect Column. And BOTH will be on Line J. PERIOD. NO EXCEPTIONS!!
From Dave: fringe rate agreement might not be with HHS...suggest using phrase "cognizant federal agency" in case it's another agency such as DOC, DOD, DOL, etc.
Consultants
Indirect Cost charged to SBA
Leave BLANK!
Leave BLANK!
Indirect Cost

28. 9 Common Errors on the SF 424A (Budget for Non-Construction Programs)
Error #9: Program Income is included on SF 424A. Grants.gov form may have automatically populated Box 7 to the SF 424A Application total, resulting in erroneous totals.
Solution: Leave Box 7, “Program Income” BLANK. Include Program Income amount and planned use in your Technical Proposal.
Finally, as in the SF 424, Program Income is not included in the SF 424A. All columns in Line 7 should remain blank.

29. Error #9: Solution: Leave Program Income BLANK
SF 424A – Budget for Non-Construction Programs
SBA Funding
CASH MATCH
IN-KIND
INDIRECT
1. SBA Funding
2. CASH MATCH
3. IN-KIND
4. INDIRECT
5. TOTAL
Error #9: Solution: Leave Program Income BLANK
If you see that there is Program Income on the 424A, go back to the 424 and ensure that a mistake on that form did not automatically populate the 424A.
Consultants
LEAVE BLANK
LEAVE BLANK
LEAVE BLANK
LEAVE BLANK
LEAVE BLANK

30. Budget Justification Worksheet
A Budget Justification is required for the Lead and each service center.
OSBDC prefers the use of SBA’s Budget Justification Worksheet for the following reasons:
SBA’s form has separate columns for Federal (SBA), Cash Match, In-Kind Match, and indirect charges by line item.
Required budget justification instruction details (purpose, rates, names etc.) are clearly stated for each item.
Budgets arranged in this manner are processed easily and quickly.
(Please DO NOT add columns to SBA’s Budget Justification)
On to the Budget Justification.
OSBDC prefers to use SBA’s Budget Justification Worksheet because
It mirrors the five columns and eleven line items in the 424A and is pre-organized for a quick review.
Also the instruction details are included and clearly stated for each line item/cost category. Cost and narrative is all in one place by using the OSBDC form.

31. Budget Justification Worksheet
However, if the SBA’s Budget Justification form is not used, the following is needed for each Center:
SF 424A (Budget for Non-Construction Programs) for the Lead and each service center; AND
Budget justification summary for each center with all the detail specified on SBA’s Budget Justification Instruction form.
Please do not include costs that are not part of the SBDC program budget.
If you are not using SBA’s Budget Justification, these items must be submitted:
An SF 424A for the Lead and each service center AND a budget justification summary for each center which includes all the detail on SBA’s Budget Justification Instruction form.

32. 10 Common Errors on Budget Justifications – Personnel List
Error #1: Required Personnel List is Missing, Incomplete, or Incorrectly documented.
Solution: Ensure that Personnel List is included and entries in all columns are completed for each position.
List names and titles of all personnel to be charged to the Cooperative Agreement.
For each position show: personnel cost charged to federal and match, total annual salary for position, number of months charged to SBDC program, level of effort in percentage, and total as the basis to estimate personnel costs.
Show position title only for temporary hires (Student interns, etc.) and vacancies (personnel to be hired for unfilled positions.) Plans to fill vacancies in key positions should be included in the Technical Proposal.
The Personnel list should include all persons charged to the Cooperative Agreement, either full or part-time.
The List shows personnel charged to federal and match, total annual salary, number of months charged to the program, the level of effort in percentage, and the total charged to the SBDC Program.

33. Needs to be Actual
Here we have a sample of how the Personnel sheet should be filled out.
The Total Annual Salary allows OSBDC Grants Management Specialists to determine whether these costs are reasonable.
In this sample, everyone is full-time and works year-round.

34. Amount Charged to SBDC Program
Federal Share
Match
Total Salary
Months
% Time
In this sample, please refer to the VACANT: Counselor, the row with the first blue arrow.
The total salary is $50,000 with 100% of time charged to the SBDC Program. However, only 6 working months of the year are indicated, so the amount charged to the SBDC Program is only $25,000.
The VACANT Receptionist has a total salary of $26,000 and the months indicated are 12, but only 75% of time is with the SBDC Program. The charge to the SBDC Program is therefore $20,000.

35. Amount Charged to SBDC Program
Sheet
nnel Sheet
Amount Charged to SBDC Program
Federal Share
Match
Total Salary
Months
% Time
The formulas to verify that the form has been filled out correctly are at the bottom of OSBDC’s Personnel Worksheet.

36. Total on Personnel Sheet = $800,000
Amount Charged to SBDC Program
Federal Share
Match
Total Salary
Months
% Time
Finally, does the total on your Personnel Worksheet……..
Total on Personnel Sheet = $800,000

37. Standard Form: 424A
SBA Funding
CASH MATCH
IN-KIND
INDIRECT
TOTAL
Total Personnel = $800,000 Does this square with the total on your Personnel Sheet?
Consultants
………correspond with the total Personnel costs on your Network 424A?
Here I would like to acknowledge that many SBDC, particularly the larger networks, submit Personnel sheets for the Lead and each service center with all the requirements. This is of course, fine with OSBDC.

38. 10 Common Errors on Budget Justifications - Fringe
Error #2: Fringe benefits & rates are not included in the Budget Justification.
Solution: Attach a copy of the fringe rates schedule or the rate agreement.
If unavailable, list fringe benefits.
If the fringe benefits rates differ, indicate the highest rate applicable for the Lead Center and each service center.
On to Fringe: If you do not have indirect cost rate agreements with a cognizant federal agency, then attach a list of fringe benefits and Indicate the highest rate applicable.

39. …as in this Budget Justification Worksheet
…as in this Budget Justification Worksheet.. Note that the applicant has embedded instructions in the Worksheet as an internal guide as well as for her sub-recipients.

40. 10 Common Errors on SBA’s Justification – Travel
Error # 3: Travel Expense Detail is Missing or Incomplete: In- and out-of-state travel not clearly identified; mileage and rate for local travel missing; Travel to ASBDC conferences, Lead Center Director travel to SBA meetings, and personnel travel for professional development purposes not included.
Solution: Ensure Lead Center and all Service Center budgets include required detail for both local and out of state travel.
Provide purpose for in-state and out-of-state travel.
For local travel, provide anticipated mileage and mileage rate.
For out of state (region) travel: itemize reason, mode of transportation and rates, number of trips, number of travelers, per diem.
List all travel to the ASBDC Conference
For travel requiring prior approval, including international travel, refer to the Program Announcement, Section 8.3.2, Advanced Understandings, Travel.
Travel is a perennial problem within OSBDC Budget reviews.
Please identify In-State, Out-of State, mileage and mileage rates for local travel.
For Out-of-State travel, list purpose, transport costs and rates, number of trips, number of travelers and per diem.
Always include travel to the ASBDC Conference.

41. On the Budget Justification Worksheet, the applicant has included In-State and Out-of-State travel, mileage rates for local travel, and ASBDC conference travel.
In this sample, per diem rates are included in the travel costs.

42. 10 Common Errors on Budget Justifications – Equipment and Supplies
Error #4: Equipment items incorrectly identified.
Solution: Unless Host’s policy has a lower threshold, include only items costing $5,000 or more in Line D.
Items costing less are considered intangibles/expendables by SBA and should be listed under “Supplies.”
For centers following their host institution’s procurement policies, then indicate the appropriate (lesser) amount in Line D.
Error #5: Supplies not individually identified.
Solution: List the types of supply items, such as general office, operational, computers and computer supplies.
SBA’s definition of equipment has a threshold of $5,000 and above, with a useful life of one year.
Anything below should be allocated to the supplies category and it is important that they be broken out discretely. While laptops and computers may be in this category, they must be accounted for.

43. PAUSE

44. 10 Common Errors on Budget Justifications – Contractual
Error #6: Lead Center Budget Justification includes service center costs in Line F.
Solution: DO NOT PLACE CONTRACTED SERVICE CENTER COSTS IN THIS CATEGORY. Refer to the Program Announcement, Section , Service Center Costs. Even if paid contractually by the Lead Center, service center costs must be allocated and broken down by line item within each individual service center’s Budget Justification. DO NOT PLACE THESE COSTS IN THE LEAD CENTER BUDGET. The Lead Center budget justification should only include contractual costs allocable to the Lead Center.
Error #7: Details for contracted services are missing or incomplete.
Solution: List type of services, number of hours and hourly rate for contract services, or square footage for space in this category.
The Contractual Line item tends to create a lot of confusion. Sometimes the lead center includes all the service centers (which, technically, are contractual relationships) in this category.
OSBDC requests that you DO NOT do this, but instead include all service center costs in individual Budget Justifications which include all the cost categories in OSBDC’s Budget Justification instructions.
Only contractual costs allocable to the Lead Center should go in this category.

45. Under the Contractual line item in this sample, we at OSBDC would expect a breakdown of these costs either in a separate Budget Narrative or in the technical proposal narrative
Note that the Consultant category indicates purpose, number of hours and rates of pay.

46. 10 Common Errors on Budget Justifications - Other
Error #9: Detail is missing or incomplete for “Other” cost category. Items included are not listed or explained. Often an un-itemized “dumping ground.”
Solution: “Other” category may include, but is not limited to: postage, printing, software, copying, publications, subscriptions, periodicals, dues, telephones, and conference fees.
List items included in cost estimate.
Do not list items for which no expenses are estimated.
Finally the “OTHER” cost category tends to be a catch-all and is not broken out. Items in this category MUST be individually listed.

47. ….like this…..
Also, please REMOVE the item label that does not have a corresponding dollar amount.

48. 10 Common Errors on Budget Justifications – Indirect Costs
Error # 10: Indirect Costs are found in other Budget Justification line items, particularly in “Contractual” and “Other.”
Solution: Indirect costs should only appear in Line J.
The rule of thumb: If costs can be allocated to a direct cost category, it should not be found in the indirect column of the budget justification.
Check to ensure that indirect costs totals in Budget Justification match amounts shown in Schedule of Indirect Cost Worksheet.
Moving on to the Indirect Cost Category:
As with the SF 424, Indirect Costs should only be allocated on Line J and in two columns on the Budget Justification. PERIOD.

49. SBA
Cash Match
In-Kind Match
Indirect
Total
As in the SF 424A, Indirect Costs are only reflected in the column representing SBA Funding and “Indirect ,” Column 4 on Line J.
Here are the two columns in which indirect costs may appear aside from the “Totals” column:
In line J Column 1, the indirect charged to the federal amount
And line J, Column 4, the Indirect Column
These are the ONLY TWO PLACES where indirect charges may be placed. NO EXCEPTIONS!!

50. Errors Regarding Indirect Costs
Error #1: A copy of a current, signed indirect cost rate (ICR) agreement for the Lead Center and each service center is not submitted. Signature page is not included.
Error #2: The incorrect rate is applied, i.e. “Research”
Error #3: The ICR’s effective period does not fall within the Cooperative Agreement proposed project period.
If the ICR has been “provisional” for more than one year, please include documentation that demonstrates the center is in process of renewing their ICR.
If a service center does not have a cognizant agency, please contact your Project Officer who can offer SBA’s Indirect Cost Rate of 24%.
Errors Regarding Indirect Costs:
OSBDC will disallow indirect costs charged to the Cooperative Agreement if a current, signed indirect cost rate agreement with a cognizant agency is not included for each center claiming indirect cost.
SBDC funds are for Other Sponsored Activities (OSA) according to the 2CFR Part When the Colleges and Universities Rate Agreement says – “Applicable to research, Instruction or Other Sponsored Activities (OSA)”, OSBDC must use the rate applicable to OSA. If the SBDC does not have an OSA rate, the Grants Management Specialist will contact the cognizant audit agency for advice.
For OSBDC purposes, a current agreement consists of one in which the effective period of the rate agreement at a Fixed or Predetermined rate falls within the proposed budget period for a single year proposal, or within the first year of a multi-year proposal.

51. Here is an HHS example of an ICR Agreement: Let’s just say that this SBDC host institution’s ICR Agreement is included in a single-year Calendar Year SBDC proposal. From OSBDC’s point of view, the Effective Period for the Provisional rate was from July 2011 through July 2012, a year after the Provisional rate kicked in.
Therefore, for the SBDC’s 2012 fiscal year (Jan through Dec 2012) , the Effective Period for this Provisional rate was acceptable, because it fell within the Proposed Project Period for this Calendar Year SBDC.
If this indirect cost rate agreement were presented in a FY 2013 proposal, however, the agreement would be considered expired. OSBDC may elect to honor the rate agreement if the Lead Center provides evidence of an ongoing negotiation between the recipient and their cognizant federal agency for a new indirect cost rate agreement.

52. SCHEDULE OF INDIRECT COSTS
SAMPLE FORMAT
SCHEDULE OF INDIRECT COSTS
(Note: Use this schedule if more than one rate was in use during the year)
(a)
(b)
(c) = a x b
(d) see below
(e) = c – d
(f) see below
Name of Site
Rate (%)*
Method of Allocation*
Base**($)
Total Indirect Costs ($)
Amount Reimbursed by Federal Funds($)
Amount Waived ($)
Amount Waived reported on SF 425
Lead Center
0.0%
$0.00
Service Center A
Service Center B
Service Center C
Service Center D
Service Center E
Service Center F
Total
* See Indirect Cost Rate Agreement
** The base should include allowable federal and cash match expenditures.
(d) This amount should not exceed the indirect cost amount included in the federal share column on the Notice of Award.
(f) This amount should be shown on the SF 425– Federal Financial Report. This amount should not exceed the indirect cost amount included in the non-Federal share column on the Notice of Award. Furthermore, this amount should not exceed the waived amount, reported above, in column (e).
Does this = Total IC on your 424A? On your Aggregate Lead and Service Center Budget Justifications?
Schedule of Indirect Costs:
We tend to have few errors on the Schedule of Indirect Cost, and most tend to be that the Rates (Column A) do not match the rates provided in the ICR Agreements. Please double check!
We include also a Cross-Walk reminder that the Totals on your Schedule of Indirect Cost Worksheet should square with the totals on your Network 424A and Budget Justification Worksheets.

53. Finally: Do The Numbers Add UP??
Perform the following Final Crosswalk:
Does each individual line item across the four discrete columns of your Network 424A square with the corresponding cells of your aggregate Budget Justification Worksheets for lead and service center budgets?
Finally: Do the Numbers Add Up?
As a reminder:
We have already conducted a preliminary Summary Cross-walk between the 424, 424A and Budget Justification Worksheets.
We have already cross-walked Personnel Costs with the Personnel Worksheet; Minimum Cash Match requirements with the Cash Match Certification; Indirect Cost totals with the Schedule of Indirect Costs.
Now we will do the final Cross-walk: the Biggie

54. This is the Indirect Column and any charges will be in line 6j.
Standard Form: 424A
SBA Funding
CASH MATCH
IN-KIND
INDIRECT
TOTAL
$60,000
$20,000 $0
$80,000
6a, Column 5 = $80,000 = Total Aggregate Personnel Costs….must square with Total Personnel Costs of the Lead and each Service Center BJs in the Totals column. (Column 5, Line A)
6a Column 1 = $60,000 = Total Personnel Costs paid with federal (SBA) funds on the 424… must square with the Total Personnel costs of the Lead and each Service Center BJs in the SBA Funding Column. (Column1 , Line A)
6a Column 2 = 20,000 = Total Personnel Costs paid with Cash Match on 424…. must square with the Total Personnel Costs of the Lead and each Service Center BJs in the Cash Match Column (Column 2., Line A)
6a, Column 3 = 0 = Total Personnel from In-Kind donations on the 424…. There should be no In-Kind Personnel costs in any of the Lead and Service Center BJs (Column 3, Line A)
This is the Indirect Column and any charges will be in line 6j.
Our Grants Management Specialists use large worksheets to cross-walk all discrete cost categories/line items referenced by each source of funding (SBA, Cash Match, In-Kind and Indirect) between Budget Justifications and the Network 424A. Variances, if any, are noted, and you will be asked to correct them. This can require a total budget re-submission if not done correctly the first time.
So do cross-check each cell in your Network 424A with the Totals of the corresponding cells from your Lead and Service Center Budget Justification Worksheets:
For example, let’s look at Personnel paid for with SBA funding: You will add up all Personnel costs from your Lead Center and Service Center budgets charged to SBA. This should square with the $60,000 on your Network 424A.
Similarly, the Personnel Cash Match cell on your Network 424A should equal all Personnel paid with Cash Match from your Lead and Service Center budgets. And so on…and on….and on….. For all 55 individual cells on your Network 424A.
Consultants

55. THANK YOU! Future Dates to Keep in Mind:
For FY SBDCs: June 26: 2015 Draft Proposals due to Project Officer and District Office for Review
July 17: Final Proposals Uploaded to Grants.gov
For CY SBDCs: July 31: Draft Proposals due to Project Officer and District Office for Review
August 21: Final Proposals Uploaded to Grants.gov
SBDC Forms and Worksheets:
Further Questions or Information: Contact your Program Manager
On that arduous note, this finally concludes our Budget training. Thank you, thank you all for attending this training. We are aware that federal budgets are difficult at best, and that OSBDC’s budget requirements for the SBDC Program can be particularly demanding. The precision with which you coordinate this large effort, often involving different departments within your own, and your host’s institutions, is appreciated. And we as a group will attempt to be as supportive as possible, educate, and give reasons along the way…..
And remember: Keep the dates above in mind. And register early. Update early. And upload early.
And now, if there is time left, we will answer any written questions that were sent in……