Exceptional Approval for Cost Notes 1 & 2

Cost note warning on screenTypically when you see Cost Note 1 or 2 while reviewing the preview screen, it means the issue needs to be corrected by processing a payroll transfer. There are two scenarios when a PCS Report with Cost Note #1 or #2 can be granted exceptional approval by the Central Payroll Certification Administrator (CPCA) in Contracts and Grants Accounting.

Exceptional Approval is only used for processing PCS reports that generate Cost Note 1 (NSF 2 month salary limitation) or Cost Note #2 (DHHS Salary CAP) caused by:

  1. OP retro increases
  2. Sponsor approval of salary exceptions
Cost Note #1 and #2 Warning Message

The following error message is displayed in Payroll Certification Preview screen whenever Cost Note #1 or #2 is generated:

"You must perform salary transfer to eliminate Cost Note 1 or 2. If you want to certify with Cost Note 1 or 2, the document will route to the central CG office for exceptional approval."

Click start certification to generate the Payroll CertificationIf the payroll expense needs to be corrected to comply with Cost Note #1 or #2, close the Payroll Certification Screen and process the required corrections. If the error is the result of OP retro increases or there is sponsor approval of salary exceptions, click the Start Certification button.

Next, you will receive a message once again stating that the document will route to the central CG office for exceptional approval if you don't process a salary transfer. Click Yes to proceed.

The PCS report will route to the CPCA for review and approval and you will be directed back to the Payroll Certification Tracking Lookup page.

Updating Notes and Attachments

At this point, you should immediately update the Notes and Attachments Tab with a note indicating why the payroll expense is in compliance with Cost Note #1 or #2. The reason can be added to the Note Text field. 

You should also attach additional documentation to back up your note. This must be in PDF format.

Notes and attachments tab with a text note and an attachment

Next Steps

After you add your notes and attachments: 

  • the CPCA will review the PCS Report and if everything looks OK, he or she will approve the report.
  • The PCS Report will automatically route back to the CPCA for approval.
  • After the CPCA approves, the report will automatically route to the PI for certification according to the standard process.