Fiscal Compliance CornerRecent Happenings, etc.

MRAM May 2015

Ted MordhorstDirector for Post Award Financial ComplianceResearch Accounting & Analysis

Audit News

NSF Audits

University of FloridaTotal findings:$992,462

Univ of WisconsinTotal Findings$1,669,588

NSF Data Analytics Audit UF findings:

$867K related to 2 month salary limit

$48K related to travel costs

$33K lack of supporting documentation

$27K in unreasonable equipment

$7K meal & associated costs

NSF Data Analytics Audit Wisconsin findings:

$1,276,668 of salary costs for senior personnel that exceeded NSF’s two-month maximum for salary allocation

• $192,707 of unreasonably allocated leave accrual payouts

• $70,189 of inappropriately allocated equipment expenses

NSF Data Analytics Audit Wisconsin findings:

• $56,965 of expenses incurred after the NSF award period had expired

• $35,592 of unreasonable consulting expenses

• $30,107 of unallowable relocation expenses

• $7,360 of unreasonable travel expenses

NSF Data Analytics Audit Auditor Recommendations:

Strengthen the administrative and management controls and processes

Implement university-wide procedures to ensure that all departments are monitoring the allocation of costs charged to NSF awards

NSF Data Analytics Audit Auditor Recommendations:

Strengthen controls and processes over allocating expenses for equipment and supplies to sponsored funding sources.

Require documentation of the methodology used to allocate expenses to sponsored projects, as well as a justification for how the methodology was determined.

NSF Data Analytics Audit Auditor Recommendations:

Strengthen controls and processes over allocating expenses for equipment and supplies to sponsored funding sources.

Require documentation of the methodology used to allocate expenses to sponsored projects, as well as a justification for how the methodology was determined.

NSF Data Analytics Audit Auditor Recommendations:

Strengthen the administrative and management controls and processes over charging expenses to federal grants near or after the grant’s expiration date

Ensuring that all payments made to consultants are supported by an academic services support agreement that is signed before the services are provided.

NSF Data Analytics Audit Both institutions disagreed with the findings

related to the 2 month salary limit.

Auditors did not remove the findings

Audit News

NIH Audit

University of North CarolinaTotal findings:$352,843

NIH UNC Audit Related to Cost Transfers

Transfers occurred 10 months after the initial transaction

Documentation did not provide sufficient information to determine a direct benefit to the project

NIH UNC Audit Related to Cost Transfers

Documentation did not provide an explanation for the allocation method for partial transfer

Documentation did not explain why it took 10 months for the transfer to be processed.

NIH UNC Audit Reason for disallowances

Costs were not Reasonable

Costs were not treated consistently

NIH UNC Audit Reason for disallowances

Department did not follow institutional policy

Lack of adequate review of expenditures

Final thought Audits are increasingly looking at factors

related to internal controls

Expense documentation must demonstrate reasonableness, necessary and allocability

Expenses during the last 90 days of the award are most often questioned

Final thought Both in the UG and in the audit there is

an increased emphasis on “necessary”, “essential” and “integral” to define when a cost is allowable.

It behooves us to think in these terms when processing transactions

TRAINING On May 18 Training on Cost Transfershttp://www.washington.edu/research/learningClasses are only 1 hour each (short! sweet!)

Future trainings in development

Direct Charging of Admin/Clerical salaries and other normally F&A costs

Principals for cost Allocation

QUESTIONS?