"At-Risk" PTAOs

What does “At-Risk” mean?

The term “At-Risk”, in this context, refers to the financial risk assumed when starting work on a research project prior to receiving an official signed award document or a fully executed contract (i.e., final award document) from the sponsor.  Any research effort expended during this period of time is done with the knowledge that the department is fully responsible for all expenses if UVA cannot accept the award for any reason, the sponsor ultimately decides not to fund the award, or the sponsor disallows any of the costs incurred. 

It is important to understand that establishing an “At-Risk” PTAO is not what creates the risk, it is the decision to begin work and incur costs before the award and funding are in place. 

What is an “At-Risk” PTAO?

A PTAO is designated “At-Risk” when it is initially established in Oracle.  This applies to both new (“At-Risk” Preliminary) and continuation (“At-Risk” No Cost Extension) funding.  An “At-Risk” PTAO is set up in Oracle with a $0.01 budget; once the final award document is received, the “At-Risk” award is funded (i.e., the budget is loaded into Oracle) and it becomes an “Active” award.

When is an “At-Risk” account needed?

Best practice is to request an “At-Risk” PTAO as soon as the decision is made to start or continue work without a final award document, initial or subsequent modification. 

Why should I set up an “At-Risk” PTAO?

Although not specifically required by policy, failure to establish an “At-Risk” PTAO is considered to be a poor financial practice because it creates unnecessary rework and gives the appearance of weak internal controls.  Having an “At-Risk” PTAO prevents compliance issues and mitigates risk to the University by ensuring:

  1. departments can properly allocate and accurately charge costs correctly the first time avoiding the need for subsequent labor distribution (LD) adjustments and cost transfers
  2. departments can easily monitor “at-risk” spending
  3. retroactive (≥ 90 days) cost transfers and LD adjustment are avoided
  4. effort is correctly certified if/when the work crosses effort reporting periods

Note:  In the absence of an "At-Risk" PTAO, costs incurred to support research (or other activities) in anticipation of 1) receiving a sponsored award, or 2) an award being executed and set-up in the Integrated System, should be incurred on an non-sponsored PTAO.  However, it is important to understand that these costs are still essentially at risk as they cannot be recovered if the award is not made or the sponsor's terms do not permit us to charge them for the incurred costs.

How do I request an “At-Risk” PTAO?

Requests are made using the Grant Change Form – SP23 found in the Forms dropdown menu on the Sponsored Programs website.  The form must be fully completed, signed, and emailed to ospnoa@virginia.edu.  

See OSP Procedure 8-12:  Request to Establish or Extend Awards Prior to Receipt of Funding (“At-Risk” Awards) and OSP Procedure 8-13:  Preparation of Grant and Contract Changes for more detailed information.