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Consultancy and Commercial Research Activities Expenditure Guidelines

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Section 1 - Purpose

(1) These Guidelines:

  1. support the Commercial Research Policy; and
  2. specify the nature of expenditure that can be derived from commercial research activities income.

(2) Commercial research activities fall into two categories:

  1. contract research activities; or
  2. consultancy activities.

(3) Contract research activities are those that meet the Higher Education Research Data Collection (HERDC) definition of research. Those commercial research activities that do not meet the HERDC definition of research will be classified as consultancy activities.

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Section 2 - Scope and Application

(4) These Guidelines stipulate:

  1. the control of commercial research projects in the University’s financial management system;
  2. the nature of expenditure which is appropriate from Commercial Research Project Accounts;
  3. the controls that should be exercised in approving expenditure from such accounts.
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Section 3 - Control of Accounts

(5) Commercial Research Project Accounts are controlled by set procedures.

(6) Commercial Research Project Accounts must be approved by one of the below staff members in order to be opened within the financial management system:

  1. Corporate Management Accountant; or
  2. Senior Manager, Operations and Research Accounting; or
  3. Research Accountant; or
  4. Commercial Accountant.

(7) Requests for expenditure are managed in accordance with the Delegations of Authority Policy and established procedures. This ensures sufficient funds are available in Commercial Research Project Accounts to cover the expenditure required.

(8) Commercial Research Project Accounts will be managed in accordance with the corresponding Contract Research Costing Pro forma, Consultancy Costing Pro forma or Conditions of Grant form.

(9) A range of expenditure items must be costed and charged to consultancy and commercial research activity project accounts. These include all costs included within the Contract Research Costing Pro forma, the Consultancy Costing Pro forma or Conditions of Grant form.

(10) Expenditure and cost recovery of salary costs will be undertaken in line with the appropriate Contract Research Costing Pro forma, the Consultancy Costing Pro forma or Conditions of Grant form. Specifically:

(11) Where salary costs included in the costing pro forma relate to staff who will be directly employed on the project, these staff members’ salaries will be required to be charged directly to the applicable contract research or consultancy activity project account directly via People and Culture Division processes.

(12) Where salary costs included in the costing pro forma relate to continuing or fixed term staff funded through other UOW or external funds, these costs will be recovered via a transfer of funding back to the applicable faculty operational project account or other source where the salary is paid from. The amount transferred back to the faculty operational project account or other source where the salary is paid from will be undertaken at cost recovery rate only i.e. equivalent to the amount included in Table 1: Salaries of the applicable costing pro forma.

(13) As outlined in the Commercial Research Policy, Faculty cost recoveries are required to be applied.

(14) All contract research activities must include a Faculty Cost Recovery fee of 30% as calculated in the Contract Research Costing Pro forma. This fee will be disbursed from the contract research activity project account to a faculty operational account.

(15) All consultancy activities must include a Faculty Cost Recovery fee of 35% as calculated in the Consultancy Costing Pro forma. This fee will be disbursed from the consultancy activity project account to a faculty operational account.

(16) In exceptional circumstances, a request can be made to waive the Faculty Cost Recovery fee. This must be done via the submission of a Commercial Research Tools and Resources and is subject to approval in accordance with the Commercial Research Policy. The Deputy Vice-Chancellor (Research and Sustainable Futures) will be advised of waivers approved by faculties where the contract value exceeds $50K.

(17) All consultancy activities must include a minimum of 15% Consultancy Profit, as calculated in the Consultancy Costing Pro forma. Academic Project Managers can negotiate with the relevant faculty to utilise these funds at a later time in accordance with the Residual Balance Projects Expenditure Guideline. If such approval is granted, the amount approved to be utilised in accordance with the Residual Balance Projects Expenditure Guidelines will need to be itemised in the Internal Faculty Cost Recovery and Disbursements section of the Consultancy Costing Pro forma within the Profit table.

(18) Where a Profit has been included and clearly defined within a Contract Research Costing Pro forma for a contract research activity, Academic Project Managers can negotiate with the relevant faculty to utilise these funds at a later time in accordance with the Residual Balance Projects Expenditure Guidelines. If such approval is granted prior to the project commencement, the amount approved to be utilised in accordance with the Residual Balance Projects Expenditure Guidelines will need to be itemised in the Internal Faculty Cost Recovery and Disbursements section of the Contract Research Costing Pro forma within the Profit table.

(19) Where an Academic Project Manager has received approval to allocate profit to a Residual Balance Project Account, these funds will be required to be utilised within a three-year period.

(20) At the end of the Agreement Term, and prior to the end of the Project Term, Financial Services Division will conduct a reconciliation of funds. If surplus funds are identified then the Academic Project Manager can negotiate with the relevant faculty to utilise these funds at a later time in accordance with the Residual Balance Projects Expenditure Guidelines. If such approval is granted, the amount approved to be utilised will be transferred in accordance with the Residual Balance Projects Expenditure Guidelines.

(21) Any surplus funds that remain in a Consultancy or Commercial Research Activity Project Account at the end of the Project Term and have not been approved to be transferred in line with clauses 13 and 14, will be cleared and closed to a Faculty Operational Project Account.

(22) If staff members undertake Minor External Work, this income may be placed in a Staff Consulting Project Account.

(23) Any equipment purchased from Commercial Research Project accounts remain the property of the University.

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Section 4 - Expenditure from Accounts

(24) A range of expenditure items must be charged to consultancy and commercial research activity project accounts.

(25) All costs included within the Commercial Research Costing Pro Forma or Conditions of Grant form must be charged to the applicable individual project account as per clause 15.

(26) The following types of expenditure are permitted for Staff Consulting Project Accounts:

  1. salaries and wages (including overtime and other oncosts) of staff;
  2. equipment – calculators, computers, electronic work organisers, teaching aids, audio/visual items;
  3. books and journals;
  4. professional subscriptions;
  5. travel and entertainment expenses in accordance with the Travel and Entertainment Policy;
  6. conference fees and other self-education expenses;
  7. stipends.

(27) Any equipment purchased from staff consulting project accounts remain the property of the University.

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Section 5 - Expenditure Control

(28) All purchases and payments must be made in accordance with University Policy documents, specifically the Purchasing and Procurement Policy, Acceptable Expenses Guidelines and Travel and Entertainment Policy.

(29) All transactions must be evidenced by tax invoices/receipts from suppliers of goods and services.

(30) All expenditure must be approved in accordance with the Delegations of Authority Policy.

(31) No staff member can approve their own items of expenditure.

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Section 6 - Carry Forward of Commercial Research Project Account Balances

(32) Contract Research Activity Project Account balances will be carried forward for until the end of the Project Term.

(33) Consultancy Activity Project Account balances will be carried forward until the end of the Project Term.

(34) Staff Consulting Project Account balances will not be carried forward, however any funds remaining at year end will be transferred to the staff members applicable Residual Balance Project Account.

(35) Consultancy and Commercial Research Activity Project Accounts will remain active for the duration of the Project Term.

(36) The balance of accounts will be determined by reviewing the income and expenditure over the relevant years of the project account.

(37) Project accounts may include accruals of income or expenditure to reflect the current progress of a project. If this is the case, any balance is not to be assumed as funds available for a particular staff member’s benefit.

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Section 7 - Roles and Responsibilities

(38) Roles and responsibilities are as detailed in these Guidelines.

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Section 8 - Definitions

Word/Term
Definition (with examples if required)
Academic Project
Manager		 The staff member who is the lead investigator and will take overall responsibility for ensuring that the
Commercial Research activity complies with this guideline.
Agreement Term The period as defined by the start and end date within the applicable agreement or contract.
Commercial Research
Research activity conducted under a commercial contract that includes, but is not limited to:
  1. Consultancy
  2. Licensed Consultancy;
  3. Contract Research with government, non-government and/or private sector entities, including contract research which is funded through grants awarded to industry;
  4. Collaborative research with government, non-government (including other universities) and/or private sector entities; or
  5. Cooperative Research Centres (CRCs).
This does not include:
  1. research conducted under Australian Research Council competitive grants or other grant schemes
  2. Private Consultancy
Consultancy
Any project that involves an external entity buying the skills and expertise (pre-existing know how) of Staff members, and/or use of UOW equipment to work on a specified project. Consultancies generally involve the application of existing knowledge, and do not normally lead to the development of new IP.
Consultancy Profit UOW is committed to a general policy of fully costing all externally funded Commercial Research
Activities.
This profit implements an appropriate commercial value on UOW staff time and resources and will ensure
UOW's obligations to maintain competitive neutrality are met.
This will be charged at a minimum rate of 15% and is in addition to the faculty cost recovery rate.
Contract Research
Research that is conducted by UOW at the request of and paid for by external organisations. Such research may involve IP ownership negotiations, and confidentiality and publication restrictions. Contract Research generally involves a greater level of originality than a Consultancy and will lead to the development of new IP and generally results in R&D outputs as defined in Appendix 2 of the Commercial Research Policy.
Commercial Research Project Accounts
Individual project accounts that are established in the University’s financial management system to
control the expenditure from Commercial Research activities. These projects can include:
Contract Research Activity Project Account
• This type of project account will be used to manage the costs included within the Contract
Research Costing Pro forma or Conditions of Grant form attached to individual contract research
contracts and agreements.
Consultancy Activity Project Account
• This type of project account will be used to manage the costs included within the Consultancy
Costing Pro forma attached to individual consultancy contracts and agreements.
Staff Consulting Project Account
• This type of project account can receive funds in relation to any minor external work or
miscellaneous consulting work undertaken.
Faculty Cost Recovery
The cost recovery fee applied to Commercial Research to reimburse the relevant faculty or academic unit for associated support costs.
Support costs include but are not limited to the costs of maintaining equipment, electricity, computers, IT/network services, laboratories, offices, cleaning, printers, human resources and telephones.
Note that the Faculty Cost Recovery is not intended to cover the costs of purchasing items of equipment, computers or refurbishments to accommodate new staff involved in the Commercial Research project. Such additional costs must be charged to the Client as “other” costs in the Commercial Research Costing Pro Forma.
Faculty Operational Project Account Individual project account(s) established in the University’s financial management system within a
faculty, that forms part of the faculty’s annual operational budget.
Higher EducationResearch DataCollection (HERDC) Creative and systematic work undertaken in order to increase the stock of knowledge – including
knowledge of humankind, culture and society – and to devise new applications of available knowledge.
Research
An activity must meet all of the following and be:
1. novel: aimed at new findings
2. creative: based on original, not obvious, concepts and hypotheses
3. uncertain: uncertain about the final outcome(s)
4. systemic: planned and budgeted
5. transferable and/or reproducible: lead to results that could be possibly reproduced’

https://www.education.gov.au/research-block-grants/resources/higher-education-research-datacollection-specifications-collection-2023-data
Licenced Consultancy
A Consultancy for a specific activity or series of activities, that can be provided by UOW in the same form to a range of clients typically over a one year period with minimal administration. Examples of activities in this category include but are not limited to:
- chemistry mass spectrometry facilities;
- the drill rig in Geosciences;
- XRF equipment,
- training workshops on specific transnational crime prevention issues;
- provision of scientific reports on functional foods; and
- concrete testing in Civil and Mining.
The administration is reduced as only one Commercial Research Approval Form needs to be completed each year (so long as the activities are the same for all clients) and a standard non-negotiable contract covers these activities, which can be used with multiple clients.
License renewals are to be submitted every twelve months or on the relocation of the nominated Project Manager, whichever is the sooner.
Minor External Work As defined in Section 17 of the Commercial Research Policy.
Private Consultancy
Private advisory or other services in relation to business, research, commercialisation or start-up activities that are undertaken by academic Staff in a private capacity and not through their employment with UOW.
Profit
UOW is committed to a general policy of fully costing all externally funded Commercial Research
Activities.

This profit (where applicable) implements an appropriate commercial value on UOW staff time and
resources and will ensure UOW's obligations to maintain competitive neutrality are met.
Project Term
The Staff member who is the lead investigator and will take overall responsibility for ensuring that the Commercial Research activity complies with this Policy.
Surplus Funds Remaining funds in a Contract Research or Consultancy Activity Project Account after all costs and
disbursements have been made in accordance with the applicable Costing Pro forma.