Advance/Prebilling of Charges to Sponsored Awards

Purpose: This guidance provides the Institutional position on the advance or prebilling of charges to sponsored awards.

Institutional Position: Advanced billing/prebilling of costs to sponsored awards is NOT allowable for reasons including the following:

  1. The future costs are not yet allocable to the project (for more on allocation, see OSP's Costing Principles and Guidance page)
  2. No benefit has been received by the project for the item or service being charged
  3. For cost reimbursable awards, the institution cannot collect revenue for a cost not yet incurred

If you have costs that the vendor/internal service provider will only bill in advance/prebill:

  1. Direct the vendor/provider to place the charge(s) on a non-sponsored funding source
  2. Periodically and timely cost transfer the charge from the non-sponsored funding source to the sponsored program account as the benefit of the charge is realized (preferably monthly)