Project Financial Management

Ultimately, the Principal Investigator has overall responsibility for the scientific and financial management of their research project. This includes compliance with the funder’s Terms and Conditions, their Institutions financial regulations, adherence to reporting requirements and the timely communication of significant project changes.   Nevertheless, they will often depend on their Project Manager to assist with these responsibilities.

There are a number of questions, which a project manager may wish to review and consider when a project begins in order to manage expectations and be clear on responsibilities such as:

• Is there designated financial support available within the Institutions concerned?
• Is the award subject to Full Economic Costs? If so, what is the rate?
• Does the award include all costs that were originally included?
• Is the start and end date as expected?
• Has the start certificate been returned to and accepted by the Funder?
• Have the costs be appropriately and accurately categorised?
• Do all partners agree to the budget distribution as outlined in the award letter and collaboration agreement?
• What is the frequency of reporting on the financial expenditure of the project?
• What is the expected frequency for individual partners to report to and invoice costs from the lead institution?
• Who is responsible for the reviewing and processing of invoices from external partners?

Managing the finances and resources within any project can be complex and the approach may vary depending on the Institution concerned (e.g. Higher Education compared with NHS or Local Authority-led collaborations).  The key concern of a Project Manager in any multi-partner project will be to maintain oversight of the utilisation of finances and resources across all partners in order to be able to report expenditure to the management group and the Funder as and when required.  This can be time-consuming and it is vital to establish contacts with the relevant financial contact at each Partner and set up an appropriate system to collate the information. Having said that, some academic institutions in particular, have designated financial teams who may take responsibility for this particular task and you should discuss internally with the Principal Investigator and the relevant finance teams to agree expectations on who and when this will take place. 

It may also be necessary at time to alter the budget for one or more partners as a result of the change to the project or the partners within the project (see contracts section). Any deviation from the original budget awarded outside the Terms and Conditions, should be notified to, and approved by, the funder prior to the commitment of expenditure.