Intent

To set out the administrative aspects of the review and approval of applications, tenders, proposals and contracts/agreements and the financial aspects of:

• pricing the application for external grant funds and the negotiation or tendering to supply goods or services to external parties;

• setting and waiving of indirect costs (overheads); and

• the use of incentive margins.

Definitions

Activity/project types

Commercial Activity

Undertaken at the specific request of industry or a government agency, where the sponsor/client would expect to:

• exercise some control over the project results; and
• own the project intellectual property or have some degree of exclusive access to it; or
• have the right to enforce project confidentiality and to restrict the release of results into the public domain.

Commercial activities include fee for service, consultancies, short courses not for academic credit, tenders, some contract research, expert opinion, analysis and testing services, and product and process development.

Non-Commercial Activity

Where the intellectual property and confidentiality rights are negotiable, and where University staff and students have an unfettered right to publish results (subject to issues of privacy and other forms of non-commercial confidentiality).

Non-commercial activities include grants, most contract research and activities conducted in a collaborative framework (e.g. through collaborative research centres (CRCs)).

Cost types

Direct Costs

Includes those directly and specifically attributable to the activity including:

• salary costs for all staff participating in the activity/project, including staff who are funded from other sources (such as general operating); and
• non-salary costs such as travel costs, equipment costs and consumable costs.

Indirect Costs

Also known as infrastructure charges or overheads, indirect costs recognise that there are real indirect costs to the University in undertaking these activities.  Indirect costs for an activity may include:

• provision and maintenance of buildings and physical infrastructure
• information resources and technology
• telecommunications
• insurance and legal services
• financial management services
• security, electricity, water, etc.
• general administrative services

Incentive Margin

The amount by which the price exceeds the total of direct and indirect costs.

Scope

This policy applies to any commercial or non-commercial activity.

Requirements

• A staff member (project leader) may identify an opportunity to apply for a grant, to participate in a collaborative venture or other non-commercial activity, or to provide research or non-research services on commercial terms to a client or funding body.

• All non-commercial and commercial activities must be negotiated through the University, unless formal written exemption is obtained (refer Human Resource Policy on Staff External Activities).

• All contracts and agreements (including variations) must be entered into by the University and not by the individual staff member undertaking the work.

• The review of research grant applications, tenders, and where relevant proposals for research activities (commercial and non-commercial), is the responsibility of the Research Services Office.

• The review of draft contracts/agreements or the drafting and preparation of contracts is conducted by:

  • Research Services Office in respect of research activities/projects; and

  • Commercial Services Office in respect of non-research activities/projects.

• The relevant Head of School or Director is responsible for approving a commercial and non-commercial activity or project, including pricing, with a total value of less than:

  • $400,000 (GST exclusive) for the Faculty of Science and Engineering, the Faculty of Medicine, Health & Molecular Sciences and the ARC Centre of Excellence for Coral Reef Studies (ARC CoE); and

  • $200,000 (GST exclusive) for the Faculty of Law, Business & Creative Arts, Faculty of Arts Education & Social Sciences and Divisions, excluding the ARC CoE.

• The Provost, Pro Vice Chancellor, Deputy Vice Chancellor or Executive Director is responsible for approving a commercial and non-commercial activity or project, including pricing, with a total value equal to or greater than:

  • $400,000 (GST exclusive) for the Faculty of Science and Engineering, the Faculty of Medicine, Health & Molecular Sciences and the ARC Centre of Excellence for Coral Reef Studies (ARC CoE); and

  • $200,000 (GST exclusive) for the Faculty of Law, Business & Creative Arts, Faculty of Arts Education & Social Sciences and Divisions, excluding the ARC CoE.

• Authority to send out applications, submit tenders or sign contracts for which there is specific external grant, contract, consultancy or commercial services revenue relating to commercial and non-commercial projects rests with the Financial Delegate (refer FMPM Appendix A – Delegations Policy).  [Please note that this delegation may be exercised prior to approval of the activity or project by the relevant Head of School, Director, Provost, Pro Vice Chancellor, Deputy Vice Chancellor or Executive Director in order to meet grant application submission closing dates].

• The University should not undercut the price of competitors through free or discounted use of University resources or infrastructure. The principle of competitive neutrality should be followed, i.e. that government business activities not enjoy net competitive advantages over their private sector competitors (or potential competitors) simply by virtue of their public sector ownership.

• The Provost and the Executive Director, Finance and Resource Planning are responsible for setting the indirect costs (overheads) rate and methodology.  The indirect costs (overheads) rate and methodology will be reviewed annually and subject to an assessment of costs, may be adjusted accordingly.

• The Provost, Pro Vice Chancellor, Deputy Vice Chancellor or Executive Director has the responsibility for approving the use of any incentive margin which remains after the direct and indirect costs (overheads) of the activity have been met.

Related Documents, Legislation or JCU Statutes

(FMPM Appendix A – Delegations Policy)

Human Resource Policy on Staff External Activities

For enquiries in relation to this Finance Procedure please contact carl.lawback@jcu.edu.au

Administration

Approval Details

Revision History