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Invoices and Collections

The Office of Sponsored Program-Post Award Unit is responsible for requesting funds related to externally sponsored activities. The Post Award staff will submit all invoices, including final invoices and necessary supporting financial reports to the Sponsoring Agency.  The staff is also responsible for applying payments received to the appropriate invoice and award. Ensuring timely receipt of payment is an important function of the Office of Sponsored Program (OSP) and requires a combined effort with the Principal Investigator (PI), the Department Administrator, and the sponsor.

When the University receives new awards, the designated OSP Analyst will examine the award documentation and determine the payment methods. The invoice will be created based on the payment method and invoicing requirements specified by the sponsor in the award documents. Sponsors may use financial reports instead of invoices for payment requests, but if the financial report triggers payment, it will be considered an invoice-required award.

Invoicing Methods

The Post Award Unit manages their accounts to identify and meet future deadlines. The Post Award Unit follows these general invoicing guidelines:

Cost Reimbursable

The OSP Analyst prepares and sends invoices to the sponsor based on the frequency stated in the award (usually monthly).   Invoices will be based on actual expenditures that have posted to the University’s general ledger account for the sponsored project. These invoices are generally issued the month following the invoice period to align with the prior month’s closeout and payroll distribution. Encumbrances will not be included.

  • Departments are responsible for ensuring that cost is allowable, reasonable, and allocable to the project. (See Uniform Guidance – Costing Considerations for additional information).
  • Departments are responsible for timely posting of expenditures to the appropriate account
Milestone, Fixed price, fee-for-service, and capitation awards 
The OSP Analyst works with the PI and/or Department Administrator to determine when invoicing can occur.
Milestone/Task Complete

The sponsor pays based on the completion of deliverables listed in the award agreement.  The OSP Analyst will prepare and issue the invoice to the sponsor.

  • When a milestone has been met and is ready to be invoiced, the PI and/or the Department Administrator must notify the OSP Analyst that the deliverables/task/milestone has been met and provide the information that supports the completion of the task.  
  • The PI or the Department Administrator must notify the Analyst if deliverables/milestone has been delayed and that the delay has been approved by the sponsor.
  • If any unallowable cost is identified, the OSP Analyst will notify the Department.  Unallowable costs should be moved to an unrestricted funding source as soon as possible.
Fixed Price-Scheduled Payment (balance is returned) 

The sponsor sends payments based on a schedule stated in the award.  When required, the OSP Analyst submits a sponsor invoice to trigger the payment.  The award document typically states that the sponsor requires any unexpended balance to be returned at the end of the project.  These are considered “cost reimbursable” because after the balance is returned to the sponsor, the University will have been reimbursed only for the expenses charged to the grant.

Fixed Price-Scheduled Payment (balance is retained)

The sponsor issues payments on a set schedule regardless of the department’s expenditure level or deliverables completed.  When required, the OSP Analyst submits a sponsor invoice to trigger the payment.

  • Invoices are submitted based on a pre-determined schedule and dollar amount based on the award documentation.
  • Submission of capitation information via the sponsor’s web portal by the PI or Research Study Coordinator may automatically generate a payment to the university. No invoice is required.
  • Compensation is usually established based upon a fixed amount per test or deliverable, with the PI and department assuming responsibility for keeping costs within the amount earned based on actual performance.
  • Unspent balances may be retained by the University.

Note: All cost overruns (deficits) accrued by the department are cleared prior to transferring any residual funds. Before residual funds are transferred to the department, the F&A rate is calculated on the total award amount and deducted from the residual funds. 

Advance Payment 

Similar to fixed price in which invoices are submitted based on a pre-determined schedule and dollar amount based on the award documentation and compensation is usually established based upon a fixed amount per test or deliverable.  The University may not retain an unspent balance.  Any residual funds that need to be returned must be clearly stated in the agreement. 

Letter of Credit (LOC) 

The majority of federal awards use a payment management system.  With a LOC, the sponsor allows OSP access to draw down funds directly via bank-to-bank transfer up to the awarded amount as expenditures are incurred.  This process is often referred to as a drawdown of funds.  Occasionally, the sponsor may have concerns that the award has not met their burn rate (percentage) of usage or a discrepancy between our withdrawals and the total expenditures shown under the federal financial report.  The Office of Sponsored Program will work with the department to clarify any discrepancies.

Final Invoice

A final invoice is required which is typically due 30-60 days after the award period expires.  The final invoice includes any previous charges incurred during the award period that were posted to the grant within 30-60 days after its expiration date.  Please make every effort to post all charges to your grant before the expiration date.  

Standard Invoice Format

Our standard invoice must include current and cumulative costs (including cost sharing, breakdown by major cost category, sub-award or PO number, and certification, as required in 2.CFR 200.415(a). Occasionally a sponsor may require the University to use a special, non-standard invoice that requires the PI or department input or action, such as the PI’s signature or a summary of the work completed during the invoice period.  In these cases, the OSP Analyst will work with the department to obtain the required signature or information.

Invoice will not be generated or issued if:

  • The award is not fully executed, i.e. final agreement is not signed
  • The budget period has ended and an expected extension or renewal has not been received
  • The total expenses for the billing period are zero or a net credit
  • The cumulative expenditures exceed the budget


Office of Sponsored Programs (OSP) processes all payments affiliated with sponsored activities. All payments to the University should be in US Dollars. Payment methods accepted by the University are check or electronic funds transfer (ACH/EFT). The department will be charged for all fees associated with bank fees such as EFT or rate conversion.  If a payment is mistakenly sent to the department, the department should deliver the payment to our office. The departments do not deposit checks to sponsored activities.
Payment(s)/checks/remittance advice must be directed to:
The University of Tennessee Health Science Center
Attn: Office of Sponsored Programs
910 Madison Ave, Suite 823
Memphis, TN.  38163-0001
ACH/EFT Remittance Advice


The Office of Sponsored Programs and the Departments have a shared responsibility to monitor and follow a regular collection schedule with appropriate escalation actions for those receivables not paid in full within thirty (30) days.
The Office of Sponsored Programs, Post Award unit is responsible for the collection of sponsored receivables. The department aids with collection as necessary. Any outstanding balance, regardless of amount or the invoice system, may be referred to either the Office of Finance & Operation and/or the Office of the General Counsel (OGC) if not resolved in a specified period.
If a customer has a pattern of non-payment to the University, they may be deemed high risk and not creditworthy. The department may choose to halt research until such a time as the risk of non-payment has been resolved.
The Department is responsible for covering any uncollectible balances due to unallowable costs, disputes with the sponsor, sponsor bankruptcy, or any other reason.  They may use a discretionary account to cover expenses associated with a receivable that has been deemed uncollectible after all reasonable collection efforts have been taken.  If the receivable (or a portion thereof) is subsequently collected from the sponsor, the collected amount will be credited to the discretionary account that covers the expenses. Write-offs are handled in Finance and Operations.
Dec 6, 2023