Procedures for Determining U.S. Dollars in Agreements with Foreign Currency

Reason for Procedure: Minimize foreign exchange risk to the University and to establish responsibilities for the Office of Sponsored Programs (OSP), Sponsored Funds Accounting (SFA), and University units.

OSP Responsibility: Be aware of risks involving the acceptance of agreements with terms in foreign currency, and negotiate with the sponsor the most favorable terms to reduce such risk. Clearly identify the currency on the Award Summary Sheet.

SFA Responsibility: Invoice promptly, clearly identify the currency on the billing invoice, inform units of changes in the foreign exchange rate and the effect on their restricted account.

PI/Unit Responsibility: Be responsible for any shortfalls, or benefit from any gains in the awarded amount, due to the foreign exchange rate. Be responsible for any wire transfer fees, etc.

Procedures:

OSP should negotiate with the sponsor to set the agreement amount in U S dollars, prior to final acceptance, whenever possible.

If sponsor will not convert agreement to U S dollars advise the PI of the possible risks and:

1. Negotiate to set terms of payment as "payment in full upon execution of agreement". This will allow for a one time currency exchange and reduce risk and possible loss of dollars, or

2. Negotiate to set terms for a schedule of payments, remembering to obtain as much up front as possible to reduce risk due to fluctuation in the exchange rate, or

3. Negotiate for monthly, quarterly, etc., reimbursement of costs. The exchange rate used would be the rate current at the time payment was received from the sponsor.

If the sponsor is NATO and the agreement is stated in foreign currency, OSP will convert it to US dollars on the Instructions for Payment Form and return with the executed agreement.