Departmental Guarantee Memorandum - C03
The purpose of this procedure is to outline the process for Departmental Guarantee Memorandum (DGM).
Request a Departmental Guarantee Memorandum (DGM) to secure an account for spending, hiring, graduate student contracts, etc., prior to an award receipt. The department guarantees to cover the expenditures incurred, in the event the sponsor rejects the proposal or denies the expenditures. There are two types of DGM:
Pre-award account – spending 90 days prior to the award start date under expanded authority with sponsor approval.
In some cases, grantors will allow the University to incur expenses on a grant before the actual start date, generally referred to as pre-award account. Under the expanded authorities granted to the university by some funding agencies, they will allow 90-day pre-award expenditures when the ORSP has prearranged prior approval. Once the ORSP has authorized prior approval, the Principal Investigator/Project Director (PI/PD) or delegate will initiate the DGM request.
At-risk-account – spending prior to receipt of the award or increment.
The ORSP recommends a DGM when there are activities and/or costs incurred prior to the award or increment receipt (at risk award), provided there is high expectation the award is forthcoming. The department assumes the financial risks and the Principal Investigator will not perform any compliance activities without approval (i.e., IRB, IACUC, etc.). The ORSP also recommends a DGM when the award has been received but due to extenuating circumstances (e.g., compliance hold), the ORSP is unable to forward the award to Grants Accounting for setup.
This procedure applies to all sponsored projects subject to OU Policy 19.045 Administering External Grants and Contracts set up as separate accounts in the OHIO Financial Management System (FMS).
The PI/PD submits a request for a DGM that meets all conditions below, following the submission of a proposal. The ORSP will review and submit the approved DGM to Grants Accounting within one business day of receipt, when received before 3:00 PM EST. Grants Accounting will set up the account in Oracle and notify the PI/PD of the account number within 3 business days upon receipt of a valid DGM. Grants Accounting will not issue invoices for expenditures incurred on an at risk award spending account. The DGM is valid for 90 days. If the ORSP does not receive the award within 90 days, the PI/PD will request an extension of the DGM or ORSP will contact Grants Accounting to move the expenses from the at-risk award spending account to the account listed in the DGM.
- The required signatories must approve the transmittal.
- The ORSP will have submitted proposal to the agency.
- The PI/PD or delegate will initiate the DGM and all required signatories must approve.
- The PI/PD or delegate must provide a legitimate reason for the DGM.
- The DGM must have a valid account number for the transfer of expenditures, in the event the sponsor rejects the proposal or denies the expenditures.
- Department Chair/School Director
- AVP for Research
Required Information from transmittal and attachments
- CFDA# (if Federal funding type)
- Period of performance
- Indicate Task number
- Funding Type: Federal, State, Private, Local Government
- Activity Type: Research, Public Service, or Instruction
- Org Unit for which the award is being set up
- IDC rate
- Standard budget line items or those allowed
- Identification and approval for all cost share commitments (related cost share accounts must be set up at the time of the DGM)
Click here to request a DGM through LEO.
Training is available through ORSP upon request. Submit request for training to ORSP@ohio.edu
Roles and Responsibilities