GAP 200.100, Capital Equipment Purchases on Sponsored Projects

I.    Purpose

II.   Procedure

III.  Equipment Screening Form

IV.  Acquisition of Excess Federal Property

V.   Roles and Responsibilities

VI.  Federal Regulations

 

 

I. Purpose

This procedure describes the procurement processes, documentation and approvals associated with purchasing and maintaining capital equipment on reportable awards. Reportable awards are projects where invoices and financial reports are submitted by an institutional office (Post-Award Financial Management (PAFM) or Treasury Billing Services (TBS)); and are represented by the 20x-28x, A03, and 30x-38x WBS element ranges. Capital Equipment refers to equipment maintained by Plant Accounting, that depreciate in value over time and cost in excess of $5,000; but excludes fabrications of systems (purchases using G/L account 668300) and computer software (purchases using G/L account 667600).

This process depends upon knowledge of the concepts and terms presented in GAPs 200.372, Purchasing Goods on Sponsored Funds, and 200.050, Plant & Equipment Capitalization. Grant Managers (GM) and Principal Investigators (PI) should review these GAPs before initiating a capital equipment purchase on a reportable award.

Note: when purchasing equipment with federal funds, the purchase of American-made products is encouraged.

 

II. Procedure

The process for purchasing capital equipment from sources external to Duke University on reportable awards relies upon knowledge of GAP 200.372, Purchasing Goods on Sponsored Funds and GAP 200.320, Direct Costing on Sponsored Projects. These purchases, made using the appropriate 66xxxx G/L accounts, are subject to the principles of allowability, allocability and reasonableness, and GMs are responsible for ensuring these principles are used as standards in documentation.

 

1. Prior to the creation of a Buy@Duke cart, the PI and GM must ensure the purchase is allowable under the Terms & Conditions of the award and that funds are available. If the Sponsor required prior approval for the purchase, the PI and GM should coordinate this request with the appropriate pre-award office so that documentation of this approval appears in the Notes and Attachment section of the Buy@Duke Cart.
2. A shopper creates a Cart in Buy@Duke and, following appropriate academic unit workflow and purchase procedures, receives approval and submits for further review. If the purchase uses federal funds, an Equipment Screening Form must appear in the Notes and Attachment Section of the Buy@Duke Cart. See Section III for further instruction.
3. SAP Buy@Duke system will automatically route the Cart to PAFM if federal funds are used. PAFM will review the Cart to ensure compliance with the terms of the award, the appropriateness of the WBS element and G/L, and the attachment of a completed Equipment Screening Form. Once the Cart has received approval, it routes to Procurement Services.
4. Procurement Services reviews the Cart to ensure compliance with University andsponsor purchasing procedures prior to issuing a Purchase Order (PO). Upon issuance of a PO, SAP will route the PO to Plant Accounting.
5. Plant Account performs final review of the PO. The SAP Asset Master Record will be created and linked to the line item(s) of the PO.

 

III. Equipment Screening Form

Capital Equipment Purchases on sponsored funds require further documentation and additional approvals beyond existing grant and departmental SAP Buy@Duke workflow. A Capital Equipment purchase is a purchase exceeding $5,000; but excludes fabrications of systems (purchases using G/L account 668300) and computer software (purchases using G/L account 667600).

Per 2 CFR 200.318(f), Duke must avoid the purchase of unnecessary or duplicative items. Duke Procurement Services and Supply Chain maintain a research surplus inventory, and PIs are encouraged to review available inventory prior to purchasing Capital Equipment.

A complete Equipment Screening Form includes

1. A description of the functionality of equipment being purchased
2. WBS element(s) to be charged
3. Narrative documentation of the scientific or programmatic needs of the project that will be furthered by the purchase of the project. Convenience is not a sufficient reason. The GM should review to ensure these justifications meet allowability, allocability, and reasonableness concerns.
4. Signature of the PI, certifying that, to the best of their knowledge, the scientific or programmatic aims of the project require the functionality and capacity of the equipment, per 2 CFR 200.318(f).
5. Signature of a Departmental Representative, validating that they have reviewed the completed form and related documentation.

The completed form must appear in the Notes and Attachment section of the Buy@Duke Cart. Questions regarding allowability or procedure should be directed to your OSP liaison.

 

IV. Acquisition of Excess Federal Property

The federal government may transfer excess government property to Duke as a means of providing additional grant support and conserving equipment funds. In these rare instances, though the government retains the title to the equipment, Duke assumes responsibility for custodianship and Plant Accounting must maintain adequate records of the location and condition of the property in the University’s property records. Principal Investigators should note that Duke may also be responsible for costs associated with shipping, packing and repairs. Acceptance of the property is subject to written directions from the sponsoring agency of the federal government. It may not be disposed of without prior written approval from the sponsoring agency.

For further information and assistance with managing excess federal property, contact Plant Accounting.

 

V. Roles and Responsibility

For equipment purchased on Sponsored Projects, property control and record keeping responsibilities include the following:

A.  Principal Investigator

As custodian of the equipment, the PI is responsible for:

• Safeguarding and maintaining equipment in good repair
• Promptly notifying their GM or other department representative if sponsor-owned equipment becomes surplus, lost, stolen, or missing. The GM/department representative will then notify PAFM.
• Promptly notifying their GM or other department representative of any change in the location of the equipment. The GM/department representative will then notify Plant Accounting.

B.  Procurement Services

Procurement Services should keep the following in the permanent Purchase Order file and/or SAP system:

• Buy@Duke Cart
• Purchase Order
• Price or rate quotations obtained
• Equipment Screening form, if required
• Relevant approvals from PAFM or other offices as dictated by the award and purchase terms

C.  Post-Award Financial Management

PAFM is responsible for:

• Coordinating with Plant Accounting to ensure that the University's capital asset records are accurate and up-to-date
• Notifying appropriate sponsors of any sponsor-owned equipment that becomes surplus, lost, stolen, or missing
• Reviewing and approving the disposal of sponsor-owned equipment according to the requests of the sponsor in coordination with the PI, management centers, Plant Accounting and Duke Surplus
• Submitting property reports to sponsoring agencies as required by the award document.

D.  Plant Accounting

Plant Accounting is responsible for:

• Tagging all capital equipment with the appropriate property control tags as appropriate and recording specific information such as description, model, location, serial number, etc., as required by 2 CFR Part 200 §200.313
• Maintaining the capital asset records on an accurate and up-to-date basis
• Conducting an independent physical verification of all capital and sponsor-ownedequipment and adjusting the capital asset records based on their findings, as required by 2 CFR Part 200 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.

 

VI. Federal Regulations

This GAP reflects the provisions of the Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards, 2 CFR Part 200, otherwise referred to as the Uniform Guidance. The UG became effective as of December 26, 2014, and revised as of November 12, 2020, and all awards issued on or after this date must be managed in accordance with its provisions. It is important to verify the applicable regulations for an individual award, which may be found in the Award Notice issued by the funding agency.

These guidelines pertain to federally sponsored projects and should be used as guidance for all sponsors unless specifically addressed in a non-federal sponsor’s policies and/or procedures.

This GAP supersedes previous GAP versions, Duke Policies, Guidelines, etc.

Note: This guidance is administrative in nature and is not a cost reimbursement policy. Failure to comply may or may not result in adjustments of charges to the award. Noncompliance with this policy does not mean this cost is unallowable from an external perspective. Any adjustments of charges will be as required under applicable federal cost reimbursement principles. If a cost is removed from an award for any reason, whether or not related to this guidance, the cost will generally be charged to departmental funds.