Foreign Currency
Effective January 1, 2017 the following procedures will apply to foreign currency proposals and awards.
Exchange Rate Considerations
Fluctuations in exchange rates can have significant effect on the payments for sponsored research projects. All UC Santa Cruz departments should be aware of the risks, including potential loss of Dollars, involved in agreements containing payment terms in foreign currency.
Proposal/Award Terms for Foreign Sponsors
To eliminate the risk associated with exchange rates, the Office of Sponsored Projects (OSP) will attempt to establish the award amount and payment terms in U.S. Dollars. If the sponsor will not agree, OSP will try to reduce the risk associated with exchange rates by requiring payment in full upon execution of the agreement.
A sponsor may not agree to establish an award amount and payment in U.S. dollars or pay in advance, so OSP will require an informed consent memo before proposal submission signed by the Dean stating that s/he confirms approval of OSP submitting the proposal. The memo will also require signatures of PI, Department Chair and Dean, confirming acceptance of all financial risk associated with foreign currency fluctuations. The PI, Department Chair and Dean choose to fund the possible loss in currency exchange or the proposal will not be submitted.
It is not always clear at the time of proposal submission that an award will be made in foreign currency. In these cases, when a sponsor will not establish an award amount in US Dollars or pay in advance, the informed consent memo will be signed at the time of award. If the PI, Department and Dean do not sign confirming that they will bear all financial risk associated with foreign currency fluctuations, the award will not be accepted.
The signed informed consent memo will be maintained with the executed award.
