Some grant programs require institutions to support part of a project's costs. Institutional support may constitute matching funds and/or cost sharing. If the sponsor requires matching or cost-sharing by the institution, the budget justification should explain what is being provided by the institution.
Matching funds are actual cash contributions and are required by some agencies. The matching funds must come from a specific University budget(s) and are subject to audit. The source of matching funds for a federal grant must come from non-federal sources. Cost-sharing may involve in-kind contributions. Some examples of cost sharing include: (1) faculty effort over and above the amount of salary support being requested on the project (i.e., 30% time with only 10% of salary requested equates to a 20% in-kind match plus the fringe benefits and indirect costs associated with this 20%); (2) copying costs, supplies or other items not included in the budget request but contributed to the project; or (3) failure to recover the full indirect costs or other costs due to sponsor policy. Cost-sharing should not be promised routinely. Generally, it should only be offered when a sponsor requires it. Most sponsors state that unsolicited cost sharing does not enhance the competitiveness of an application. All cost-sharing promises made in an application are subject to inclusion in the grant conditions and must be treated as auditable expenses.
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