Although cost sharing can generate benefits it can also have other impacts, such as some areas being disallowed during audits, and an increase in the F&A base resulting in a lower F&A rate for the your sponsored agreement--both of which result in a loss of $$$ to your project.

So...what can you do?  Here is a few helpful hints--Don't show departmental research activity; Only show cost sharing if you need it; and, if your budget is cut, be sure to document your reduction of cost sharing!

Cost sharing can be either mandatory or voluntary.  It becomes mandatory if it is required by legislation or if it has been required by the sponsor.  This should be identified in the RFP/RFA or the funding opportunity identifies it as a condition for the award of the agreement.  It can also be mandatory when it has been quantified in a proposal by the principal investigator.  (So...when preparing the proposal and its budget,  if you included it, then it is mandatory!)  Cost sharing is voluntary (meaning not mandatory) if it is not required by the sponsor/sponsored agreement, or if it has been offered merely to strengthen the proposal qualitatively.  Some particular characteristics of cost sharing that is not mandatory is that it is not included in the budget, has been described but not quantified in the proposal narrative or letter of transmittal, and it is not included as a requirement in the award document.  One big myth is that any voluntary cost sharing does not need to be identified or accounted for.  Any time even voluntary cost sharing is a possibility, identify it, but be sure that it is not quantified in such a manner as to make it mandatory!