Financial Management
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1
Sponsored Research Financial Management:
Current Pre and Post-Award Issues
Sponsored Research Financial Management:
Current Pre and Post-Award Issues
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Sponsored Research Financial Management: Current Pre and Post-Award Issues
Sponsored Research Financial Management: Current Pre and Post-Award Issues
Moderator/Team Leader:• Jerry Fife
Assistant Vice Chancellor for Research FinanceVanderbilt University
Faculty: • Michelle Fortnam
Associate Director, Internal Audit DepartmentStanford University
• Bob GallowayProfessor of Biomedical EngineeringSchool of EngineeringVanderbilt University
Moderator/Team Leader:• Jerry Fife
Assistant Vice Chancellor for Research FinanceVanderbilt University
Faculty: • Michelle Fortnam
Associate Director, Internal Audit DepartmentStanford University
• Bob GallowayProfessor of Biomedical EngineeringSchool of EngineeringVanderbilt University
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Sponsored Research Financial Management: Current Pre and Post Award Issues
Sponsored Research Financial Management: Current Pre and Post Award Issues
Faculty (continued):• F. Edward Herran
Director, Office of Sponsored ProjectsMemorial Sloan-Kettering Cancer Center
• Cynthia WhiteDirector, Research OfficeWashington University at St. Louis
Faculty (continued):• F. Edward Herran
Director, Office of Sponsored ProjectsMemorial Sloan-Kettering Cancer Center
• Cynthia WhiteDirector, Research OfficeWashington University at St. Louis
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The Basics of A-21 Cost Allowability
The Basics of A-21 Cost Allowability
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A-21 Standards forCost Allowability
A-21 Standards forCost Allowability
• Reasonable• Allocable• Treated Consistently• These standards apply to both
proposals and active projects. If an unallowable cost is included in a proposal, the cost does not become allowable if it is not removed during the review process
• Reasonable• Allocable• Treated Consistently• These standards apply to both
proposals and active projects. If an unallowable cost is included in a proposal, the cost does not become allowable if it is not removed during the review process
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A-21 Standards forCost Allowability (cont’d.)
A-21 Standards forCost Allowability (cont’d.)
• All sponsored project awards contain terms and conditions (T&C's), which supersede all other regulations; therefore it is essential that the Research Administrator read, understand and abide by them
• All sponsored project awards contain terms and conditions (T&C's), which supersede all other regulations; therefore it is essential that the Research Administrator read, understand and abide by them
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Unallowable for Federal Reimbursement
Unallowable for Federal Reimbursement
• Expenses that are unallowable for federal reimbursement may be reasonable and necessary business expenses permitted by the University. Departments may incur these expenses but they must code them as unallowable.
• Expenses that are unallowable for federal reimbursement may be reasonable and necessary business expenses permitted by the University. Departments may incur these expenses but they must code them as unallowable.
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AllowabilityAllowability
• For a cost to be allowable, it must conform to:
Terms and conditions of the agreement
A-21 (federal awards) Institutional policy
• For a cost to be allowable, it must conform to:
Terms and conditions of the agreement
A-21 (federal awards) Institutional policy
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Allowability (cont’d.)Allowability (cont’d.)
• Some costs may be an appropriate University expense but are not allowable to charge to a sponsored project. For example, fund raising is an appropriate expense for a University, but cannot be charged, either directly or indirectly, to the federal government, according to OMB A-21.
• Some costs may be an appropriate University expense but are not allowable to charge to a sponsored project. For example, fund raising is an appropriate expense for a University, but cannot be charged, either directly or indirectly, to the federal government, according to OMB A-21.
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Unallowable Costs can be:Unallowable Costs can be:Unallowableby University
University expenses that are:
• NOT reasonable • NOT necessary • NOT allocable • NOT permitted by
University policy
These expenses will not be paid for by University.
If incurred, they must be paid for by the individual.
Unallowablefor reimbursement by Federal
Government
University expenses that are:• Reasonable • Necessary • Allocable • Permitted by University
policy
but are unallowable for federal reimbursement.
These expenses:• can be paid for by• must be coded as
unallowable
Unallowableby Sponsor
Expenses that do not conform to the sponsors terms and conditions and OMB Circular A-21 (if applicable), or are:
• NOT reasonable • NOT necessary • NOT allocable
These expenses will not be paid for by the sponsor.
University may pay for the expenses, code as appropriate.
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AllowabilityAllowability
Section J of OMB A-21 lists examples of allowable and unallowable costs
Some unallowable expenses include:
Section J of OMB A-21 lists examples of allowable and unallowable costs
Some unallowable expenses include:
Alcoholic beverages Alumni activities Commencement Entertainment (incl. Non-business meals)
Alcoholic beverages Alumni activities Commencement Entertainment (incl. Non-business meals)
Fines and penalties Goods for personal use Social membershipsFund raising
Fines and penalties Goods for personal use Social membershipsFund raising
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ReasonableReasonable
A cost must be reasonable in order to charge it to a sponsored project. Reasonableness is defined as that which reflects the action of a prudent person. The three questions a person must ask to determine reasonableness of cost are: Is it necessary for performance of the award? Does it advance the scope of work? Is it consistent with established institutional
policies and practices?
A cost must be reasonable in order to charge it to a sponsored project. Reasonableness is defined as that which reflects the action of a prudent person. The three questions a person must ask to determine reasonableness of cost are: Is it necessary for performance of the award? Does it advance the scope of work? Is it consistent with established institutional
policies and practices?
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AllocableAllocable
• Allocation is the process of assigning a cost, or a group of costs, to one or more cost objectives.
• Costs may be allocated only if they advance the work of the project.
• The cost must be assigned to the project in proportion to the benefit that the project will receive.
• Fund availability should not be used to determine allocability.
• Allocation is the process of assigning a cost, or a group of costs, to one or more cost objectives.
• Costs may be allocated only if they advance the work of the project.
• The cost must be assigned to the project in proportion to the benefit that the project will receive.
• Fund availability should not be used to determine allocability.
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ConsistentConsistent
• Requires Costs Incurred for the Same Purpose, In Like Circumstances, to be Handled Consistently as Direct or Indirect Costs
• Requires Costs Incurred for the Same Purpose, In Like Circumstances, to be Handled Consistently as Direct or Indirect Costs
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Consistent (cont’d.)Consistent (cont’d.)
• Particularly applicable to costs identified in section F.6.b of A-21 (clerical and administrative salaries, office supplies, postage, memberships and local phone service.
• Particularly applicable to costs identified in section F.6.b of A-21 (clerical and administrative salaries, office supplies, postage, memberships and local phone service.
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A-21 Section F.6.bA-21 Section F.6.b
• Identifies costs that are normally treated as indirectClerical and administrative salariesOffice suppliesPostageLocal phone serviceMemberships
• Identifies costs that are normally treated as indirectClerical and administrative salariesOffice suppliesPostageLocal phone serviceMemberships
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Possible Exceptions to Section F.6.b
Possible Exceptions to Section F.6.b
• Costs that are normally treated as indirect can be treated as direct under exceptional circumstances.
• Must meet all three of the criteria:Major Project (Project with needs beyond
that normally provided by department)Specifically IdentifiedExplicitly Budgeted
• Costs that are normally treated as indirect can be treated as direct under exceptional circumstances.
• Must meet all three of the criteria:Major Project (Project with needs beyond
that normally provided by department)Specifically IdentifiedExplicitly Budgeted
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Specific Identification?Specific Identification?
Criteria for charging an administrative expense directly to a major project
Cost must be specifically tied to
a particular sponsored project
Criteria for charging an administrative expense directly to a major project
Cost must be specifically tied to
a particular sponsored project
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Specific Identification?Specific Identification?
Criteria for charging an administrative expense directly to a major project
Must be able to show how the project benefited from the expense using:•Documentation•Or a system
Criteria for charging an administrative expense directly to a major project
Must be able to show how the project benefited from the expense using:•Documentation•Or a system
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Administrative Charging (Direct)Administrative Charging (Direct)
When all three criteria are met:
The expense can be charged directly to the project
This does not necessarily provide approval to charge any other administrative costs to the project.
In addition, the cost must meet the allowability criteria
When all three criteria are met:
The expense can be charged directly to the project
This does not necessarily provide approval to charge any other administrative costs to the project.
In addition, the cost must meet the allowability criteria
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Major ProjectMajor Project
• Requires an extensive amount of clerical or administrative support
• Requires effort that is significantly more than is normally provided by the department/unit
• Requires an extensive amount of clerical or administrative support
• Requires effort that is significantly more than is normally provided by the department/unit
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Examples of Possible Major ProjectsExamples of Possible Major Projects
• Large Complex Projects - Center grants, program project grants
• Projects requiring: extensive data accumulation, analysis, reporting, surveying or tabulation
• Projects requiring extensive amounts of travel and meeting arrangements
• Large Complex Projects - Center grants, program project grants
• Projects requiring: extensive data accumulation, analysis, reporting, surveying or tabulation
• Projects requiring extensive amounts of travel and meeting arrangements
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Examples of Major ProjectsExamples of Major Projects
• Projects where the principal focus is preparation and production of manuals, large reports, books, monographs
• Projects that are geographically inaccessible to normal departmental administrative services
• Projects requiring specific database management, manuscript preparation, human or animal Protocols or multiple project-related investigator coordination
• Projects where the principal focus is preparation and production of manuals, large reports, books, monographs
• Projects that are geographically inaccessible to normal departmental administrative services
• Projects requiring specific database management, manuscript preparation, human or animal Protocols or multiple project-related investigator coordination
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Salaries and WagesSalaries and Wages
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Institutional Base Salary (IBS)Institutional Base Salary (IBS)
• Must conform to university policies, consistently applied (A-21)
• Must be paid from the applicant organization and may not be increased as a result of obtaining grant funds (A-21 and NIH Grants Policy Statement)
• Must conform to university policies, consistently applied (A-21)
• Must be paid from the applicant organization and may not be increased as a result of obtaining grant funds (A-21 and NIH Grants Policy Statement)
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Institutional Base Salary (IBS)Institutional Base Salary (IBS)
Current Framework• Paid by the applicant organization• May not be increased as a result of
receiving grant funds• Clinical practice compensation is
considered part of IBS if guaranteed by the university, shown on the appt. form and paid through the university and included in the university’s effort reporting system
Current Framework• Paid by the applicant organization• May not be increased as a result of
receiving grant funds• Clinical practice compensation is
considered part of IBS if guaranteed by the university, shown on the appt. form and paid through the university and included in the university’s effort reporting system
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Institutional Base Salary (IBS)Institutional Base Salary (IBS)
AAMC/COGR Proposal• Institutions with affiliated practice
plans may include salary and effort as part of charges to NIH grants
• Affiliated is defined as those instances where the institution pays or directs the salary decisions for those included in the practice plan.
AAMC/COGR Proposal• Institutions with affiliated practice
plans may include salary and effort as part of charges to NIH grants
• Affiliated is defined as those instances where the institution pays or directs the salary decisions for those included in the practice plan.
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Institutional Base Salary (IBS)Institutional Base Salary (IBS)
• How about VA appointments?• More on this during our effort
reporting discussion
• How about VA appointments?• More on this during our effort
reporting discussion
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Salary and Wage IssuesSalary and Wage Issues
• Salary increases• Supplemental Compensation or
Overloads Additional compensation provided
over and above the IBS
• Bonuses
• Salary increases• Supplemental Compensation or
Overloads Additional compensation provided
over and above the IBS
• Bonuses
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Salary IncreasesSalary Increases
• Pending promotionOk to include if assured
• How should they be applied?Must be fund source neutralMust be applied consistently
• Pending promotionOk to include if assured
• How should they be applied?Must be fund source neutralMust be applied consistently
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Supplemental Compensation or Overloads
Supplemental Compensation or Overloads
A-21 indicates that faculty undertake research as a part of their normal responsibilities; however, it does recognize there are exceptions if:
• The duties are across departmental lines • Involves a separate or remote operation, and
work performed is in addition to regular departmental load and,
• The charges are approved in writing by the sponsoring agency
A-21 indicates that faculty undertake research as a part of their normal responsibilities; however, it does recognize there are exceptions if:
• The duties are across departmental lines • Involves a separate or remote operation, and
work performed is in addition to regular departmental load and,
• The charges are approved in writing by the sponsoring agency
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Salary OverloadsSalary Overloads
• Does disclosing an overload in the proposal constitute approval?
• Does disclosing an overload in the proposal constitute approval?
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BonusesBonuses
Depends on the circumstances – No clear guidance
• What do you think about?Bonuses in lieu of salary increasesBonuses based upon market
competitionBonuses based upon achievement of
departmental goalsBonuses based on financial success
Depends on the circumstances – No clear guidance
• What do you think about?Bonuses in lieu of salary increasesBonuses based upon market
competitionBonuses based upon achievement of
departmental goalsBonuses based on financial success
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Fringe BenefitsFringe Benefits
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Fringe BenefitsFringe Benefits
Some typical fringe benefitcomponents:
• FICA• Retirement• Health Care• Life Insurance• Disability• Worker’s Compensation• Unemployment Insurance
Some typical fringe benefitcomponents:
• FICA• Retirement• Health Care• Life Insurance• Disability• Worker’s Compensation• Unemployment Insurance
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Fringe BenefitsFringe Benefits
Two methods for budgeting and charging:
• Using an estimated rate for budgeting and then charging actual
• Developing, negotiating and charging rates
Accomplished by pooling fringe benefit costs and then comparing to salaries and wages.
Two methods for budgeting and charging:
• Using an estimated rate for budgeting and then charging actual
• Developing, negotiating and charging rates
Accomplished by pooling fringe benefit costs and then comparing to salaries and wages.
37
SuppliesSupplies
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SuppliesSupplies
Two Types• Laboratory (chemicals, gases)• Office (printer paper, sharpies, post it
notes)
Two Types• Laboratory (chemicals, gases)• Office (printer paper, sharpies, post it
notes)
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SuppliesSupplies
What does A-21 say about officesupplies?
“In developing the departmental administration cost pool, special care should be exercised to ensure that costs incurred for the same purpose in like circumstances are treated consistently as either direct or F&A costs.”
What does A-21 say about officesupplies?
“In developing the departmental administration cost pool, special care should be exercised to ensure that costs incurred for the same purpose in like circumstances are treated consistently as either direct or F&A costs.”
40
SuppliesSupplies
So does A-21 say anything else on thistopic?
“Items such as office supplies, postage, local telephone costs, and memberships shall normally be treated as F&A costs.”
So does A-21 say anything else on thistopic?
“Items such as office supplies, postage, local telephone costs, and memberships shall normally be treated as F&A costs.”
41
SuppliesSupplies
Does this mean that office supplies used in a laboratory must meet the major project definition to be direct charged or does the type of usage make the determination?
Does this mean that office supplies used in a laboratory must meet the major project definition to be direct charged or does the type of usage make the determination?
42
EquipmentEquipment
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EquipmentEquipment
• What is equipment?• Split funding• Fabricated equipment• Service agreements• Lease/purchase analysis• Already available but underutilized
• What is equipment?• Split funding• Fabricated equipment• Service agreements• Lease/purchase analysis• Already available but underutilized
44
What is Equipment?What is Equipment?
A-110 Definition • Nonexpendable tangible personal
property having a useful life of more than one year and an acquisition cost of $5,000 or more per year
• Institutions can set a lower amount consistent with institutional policy
• Remember this when dealing with other universities
A-110 Definition • Nonexpendable tangible personal
property having a useful life of more than one year and an acquisition cost of $5,000 or more per year
• Institutions can set a lower amount consistent with institutional policy
• Remember this when dealing with other universities
45
Equipment (Split Funding)Equipment (Split Funding)
Basis for split funding• Equipment benefits more than one
project• Cost sharing
Can non-federal amount be depreciated in your F&A rate?
Basis for split funding• Equipment benefits more than one
project• Cost sharing
Can non-federal amount be depreciated in your F&A rate?
46
Fabricated EquipmentFabricated Equipment
What is your institutional policy?• Implications of proper budgeting
and chargingProper classifications of costs (CAS
501)F&A budgeted and charged correctly
What is your institutional policy?• Implications of proper budgeting
and chargingProper classifications of costs (CAS
501)F&A budgeted and charged correctly
47
Service AgreementsService Agreements
• Direct or F&A cost?• Split funding• What if the equipment was not
purchased from the project?
• Direct or F&A cost?• Split funding• What if the equipment was not
purchased from the project?
48
Lease/Purchase Analysis Lease/Purchase Analysis
A-110• “Where appropriate, an analysis is
made of lease and purchase alternatives to determine which would be the most economical and practical procurement for the Federal Government.”
• What is your institutions policy?• When is this addressed?
A-110• “Where appropriate, an analysis is
made of lease and purchase alternatives to determine which would be the most economical and practical procurement for the Federal Government.”
• What is your institutions policy?• When is this addressed?
49
Already Available but UnderutilizedAlready Available but Underutilized
A-110 says procurement standards should avoid the purchase of unnecessary items• Is underutilized equipment covered in this
statement?• How do institutions determine what is
available and underutilized?• When is this determined?
During proposal processingBefore purchase
A-110 says procurement standards should avoid the purchase of unnecessary items• Is underutilized equipment covered in this
statement?• How do institutions determine what is
available and underutilized?• When is this determined?
During proposal processingBefore purchase
50
Subcontract, Consultant or Vendor?
Subcontract, Consultant or Vendor?
51
Subcontract or Sub awardSubcontract or Sub award
Distinguishing Characteristics:
• Performs substantive programmatic work under a grant or contract
• Bears responsibility for programmatic decision making and measurable performance requirements
• Must adhere to Federal compliance requirements if the source is a Federal award
• Retains intellectual property rights if a university
Distinguishing Characteristics:
• Performs substantive programmatic work under a grant or contract
• Bears responsibility for programmatic decision making and measurable performance requirements
• Must adhere to Federal compliance requirements if the source is a Federal award
• Retains intellectual property rights if a university
52
VendorVendor
• The procurement of goods or services from an organization which provides the goods and services to many different purchasers as part of its normal business operations within a competitive environment
• Not subject to the same compliance requirements as a subcontractor (if the source is a Federal award)
• The procurement of goods or services from an organization which provides the goods and services to many different purchasers as part of its normal business operations within a competitive environment
• Not subject to the same compliance requirements as a subcontractor (if the source is a Federal award)
53
ConsultantConsultant
An individual with the followingcharacteristics:
• Not an employee of your institution• Proven professional or technical competence
and provides this to your organization• Is not controlled with regard to the manner of
performance or the result of the service• Considered a work for hire and does not retain
any rights to the end product
An individual with the followingcharacteristics:
• Not an employee of your institution• Proven professional or technical competence
and provides this to your organization• Is not controlled with regard to the manner of
performance or the result of the service• Considered a work for hire and does not retain
any rights to the end product
54
Subcontract, Consultant or Vendor?Subcontract, Consultant or Vendor?
Given the definitions, whatactions are taken to ensure the
proper mechanism is used?
Given the definitions, whatactions are taken to ensure the
proper mechanism is used?
55
SubcontractsSubcontracts
Actions to be taken• Incorporating into the primes proposal• Cost analysis (rates)• Competition• Monitoring (technical, fiscal)• Billing (approvals)• Recognizing the culture of the
subcontractor
Actions to be taken• Incorporating into the primes proposal• Cost analysis (rates)• Competition• Monitoring (technical, fiscal)• Billing (approvals)• Recognizing the culture of the
subcontractor
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Other Costs Other Costs
57
Participant Support CostsParticipant Support Costs
Costs paid on or behalf of participantsin connection with conferences,meetings, symposia, training activitiesand workshops. Includes:
• Transportation costs• Registration fees• Per diem • Stipends• Other related costs
Costs paid on or behalf of participantsin connection with conferences,meetings, symposia, training activitiesand workshops. Includes:
• Transportation costs• Registration fees• Per diem • Stipends• Other related costs
58
Participant Support CostsParticipant Support Costs
Participant characteristics:• Not employees of the grantee• Generally not a federal employee
although there are exceptions if there is no duplication of funding
Participant support costs are generally not subject to F&A costs
Participant characteristics:• Not employees of the grantee• Generally not a federal employee
although there are exceptions if there is no duplication of funding
Participant support costs are generally not subject to F&A costs
59
Other CostsOther Costs
What other costs should we discuss?• F&A costs
WaiversAs cost sharingOn-campus vs. off campus
• Travel• Others?
What other costs should we discuss?• F&A costs
WaiversAs cost sharingOn-campus vs. off campus
• Travel• Others?
60
How about budgeting and modular grants?
How about budgeting and modular grants?
61
Procurement CardsProcurement Cards
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Procurement CardsProcurement Cards
Different Models•Which expenses?•Who gets one?•Dollar Limits•Benefits vs. risks
Different Models•Which expenses?•Who gets one?•Dollar Limits•Benefits vs. risks
63
Effort ReportingEffort Reporting
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Recent Government ActivitiesRecent Government Activities
Whistleblower Suits • Northwestern University - $5.5
million• Johns Hopkins University – $2.6
million
Whistleblower Suits • Northwestern University - $5.5
million• Johns Hopkins University – $2.6
million
65
Recent Government ActivitiesRecent Government Activities
DHHS Office of Inspector General• Review to determine extent that A-133
audits assess and document compliance with time and effort reporting requirements
• Pilot audits focusing on the relationship between effort proposed and effort charged
DHHS Office of Inspector General• Review to determine extent that A-133
audits assess and document compliance with time and effort reporting requirements
• Pilot audits focusing on the relationship between effort proposed and effort charged
66
Other Planned DHHS Pilot AuditsOther Planned
DHHS Pilot Audits• Cost Transfers – Were they made in
accordance with federal regulations and were they justified?
• Cost Sharing and Matching – Were the amounts committed provided?
• Subrecipient Monitoring – Were appropriate procedures in place to monitor their expenditures and were site visits made?
• Cost Transfers – Were they made in accordance with federal regulations and were they justified?
• Cost Sharing and Matching – Were the amounts committed provided?
• Subrecipient Monitoring – Were appropriate procedures in place to monitor their expenditures and were site visits made?
67
Recent Government Activities
Recent Government Activities
DHHS Office of Inspector General–Fall 2003
• Sought recommendations for developing Compliance Program Guidance (CPG) for recipients of NIH grants to prevent fraud and abuse
• Identified effort reporting as a risk area and sought suggestions
DHHS Office of Inspector General–Fall 2003
• Sought recommendations for developing Compliance Program Guidance (CPG) for recipients of NIH grants to prevent fraud and abuse
• Identified effort reporting as a risk area and sought suggestions
68
Recent Government ActivitiesRecent Government Activities
National Institutes of Health (NIH) has issuedan effort reporting “clarification” in itsGrants Policy Statement as follows:
“Clinical compensation may be considered in the institutional base salary as long as all criteria are met: 1) clinical practice compensation must be guaranteed by the university, 2) clinical practice compensation must be reported on the university’s appointment form and paid by the university, and 3) clinical practice effort must be included and accounted for in the university’s effort reporting .”
National Institutes of Health (NIH) has issuedan effort reporting “clarification” in itsGrants Policy Statement as follows:
“Clinical compensation may be considered in the institutional base salary as long as all criteria are met: 1) clinical practice compensation must be guaranteed by the university, 2) clinical practice compensation must be reported on the university’s appointment form and paid by the university, and 3) clinical practice effort must be included and accounted for in the university’s effort reporting .”
69
What Are the Issues Behind the Recent Problems?
What Are the Issues Behind the Recent Problems?
• The basis for calculating effort• The basis for calculating institutional
base salary (IBS)• Faculty understanding of effort
reporting• How are effort and compensation
estimated, tracked and reconciled?• Are all institutional effort and
compensation systems aligned?
• The basis for calculating effort• The basis for calculating institutional
base salary (IBS)• Faculty understanding of effort
reporting• How are effort and compensation
estimated, tracked and reconciled?• Are all institutional effort and
compensation systems aligned?
70
What Are the Issues Behind the Recent Problems?
What Are the Issues Behind the Recent Problems?
• Pre and post award processes are uncoordinated
• Lack of effective training • Unclear and/or undocumented definition
of full time appointment• Appointment letters/annual letters
vague or unclear on effort commitments
• Pre and post award processes are uncoordinated
• Lack of effective training • Unclear and/or undocumented definition
of full time appointment• Appointment letters/annual letters
vague or unclear on effort commitments
71
Other Potential Risk AreasOther Potential Risk Areas
• VA Appointments• Supplemental Compensation• Using different IBS for grant budgets vs.
payroll allocation and grant charges• Investigators with greater than 5
awards• Investigators with K awards
• VA Appointments• Supplemental Compensation• Using different IBS for grant budgets vs.
payroll allocation and grant charges• Investigators with greater than 5
awards• Investigators with K awards
72
An Example An Example
Dr. Jones Works 70 Hours/Week in the Following Fashion:• 35 Hrs. on NIH Grants• 21 Hrs. in Patient Care Activities• 10 Hrs. on Teaching Activities• 4 Hrs. on Dept./Institutional
Activities
Dr. Jones Works 70 Hours/Week in the Following Fashion:• 35 Hrs. on NIH Grants• 21 Hrs. in Patient Care Activities• 10 Hrs. on Teaching Activities• 4 Hrs. on Dept./Institutional
Activities
73
Correct Allocation on Personnel Action Form
Correct Allocation on Personnel Action Form
• NIH/federal grants50%
• Cost of practice 30%• Unrestricted 20%
• NIH/federal grants50%
• Cost of practice 30%• Unrestricted 20%
74
The Myth of the 40 Hour WeekThe Myth of the 40 Hour Week
Some assume that faculty are onlyresponsible for reporting 40 hours/week andthus could erroneously report effort asfollows:
NIH/federal grants 88%Unrestricted/cost of practice 12%
* Assumes research comes first
Some assume that faculty are onlyresponsible for reporting 40 hours/week andthus could erroneously report effort asfollows:
NIH/federal grants 88%Unrestricted/cost of practice 12%
* Assumes research comes first
75
What can be done tomitigate risk?
What can be done tomitigate risk?
Test to determine if there are problems for:
• Review appointment letters for clarity• Who signs• Faculty with VA appointments• Faculty with >5 awards • Faculty with K awards• Train, train, train
Test to determine if there are problems for:
• Review appointment letters for clarity• Who signs• Faculty with VA appointments• Faculty with >5 awards • Faculty with K awards• Train, train, train
76
How Much Money Do I Have Left?
How Much Money Do I Have Left?
77
How Much Money Do I Have Left? How Much Money Do I Have Left?
Faculty needs/desires• Budgetary flexibility• The ability to know how much money
is available• Encumbrance system for salaries• Real time encumbrance system for
other purchases
Faculty needs/desires• Budgetary flexibility• The ability to know how much money
is available• Encumbrance system for salaries• Real time encumbrance system for
other purchases
78
How Much Money Do I Have Left?How Much Money Do I Have Left?
Given these needs/desires, howcan research administrators helpin the areas of:
• Budgetary flexibility• Balance systems to facilitate vs.
control• Building a departmental system vs.
relying on the general ledger to do it all
Given these needs/desires, howcan research administrators helpin the areas of:
• Budgetary flexibility• Balance systems to facilitate vs.
control• Building a departmental system vs.
relying on the general ledger to do it all