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Roles and Responsibilities
Principal Investigators
University of Missouri – St. Louis
College of Education
February 11, 2009
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Learning Objectives
• To understand:– Principal Investigator (PI) responsibility for
sponsored programs– Key fiscal compliance requirements – Common issues and impact of non-
compliance
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Overview
I. Definitions
II. Compliance Requirements
III. Responsibility
IV. Common Issues
V. Concluding Points
Definitions
• Sponsored Award – Activities related to a proposal funded by an external entity for a specific purpose.
• PI/Co-PI – Principal Investigator. Named by sponsor on award document with ultimate responsibility for ensuring compliance.
• Fiscal Officers – the individual assisting the PI with the administrative management of an award.
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Definitions
• Unallowable costs – Costs charged to an award not meeting the requirements.
• APM – Accounting Policy and Procedures Manual. Codification of accounting policies.
• BPM – Business Policy Manual. Codification of business and administrative policies.
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Compliance Requirements
Who sets the requirements? • Office of Management and Budget (OMB) –
Oversight agency for the federal government– OMB Circulars – The federal rules for how awards are
to be administered.
• Sponsors – Individual sponsors may have additional requirements
• APM and BPM – policies established jointly by Campuses and UM System
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Compliance Requirements
Who enforces the requirements?• External Auditors – Identify questionable costs
and internal control issues. • Office of Inspector General (OIG) – Final
enforcer of requirements. May require funds be returned to sponsor, impose fines, and/or sanctions.
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Compliance Requirements
What compliance requirements apply to sponsored programs? – OMB Circular A-21 - Cost Principles for
Educational Institutions– OMB Circular A-110 - Administrative
Requirements for Grants and Agreements– OMB Circular A-133 - Single Audit
Requirements– Specific Sponsor Administrative Guides
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Compliance Requirements
When do these requirements apply?– Receipt of direct federal awards– Awards containing federal flow-through dollars– Awards where terms and conditions reference
OMB Circulars
However, the University requires all awards to follow the requirements for federal awards.
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PI Responsibility
1. General Compliance and Oversight
2. Project Planning and Proposal Submission
3. Award Set-up
4. Management During the Award
5. Award Closeout and Reporting
6. Effort Verification Reports
7. Cost Transfers
8. Cost Sharing
9. Subawards
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1. General Compliance, Oversight
• Aware of applicable requirements–OMB Circulars, University policies–Sponsor restrictions
• Ensure compliance• Attend training• Work with Fiscal Officer• The PI has the ultimate responsibility
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2. Planning/Proposal Submission
• Complete proposal timely• Obtain all approvals (PSRS) • Manage technical/programmatic
negotiations with sponsor• Establish pre-award accounts• Ensure all costs are allowable and unlike
circumstances are justified
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3. Award Set-up
• Notify ORA upon receipt• Delegate authorization• Ensure accuracy of budget in PeopleSoft• Identify federally funded equipment• Establish payroll distribution of effort - PAF
See APM 60.35 – Establishing an Award
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4. Management of Award
A. Monitor project timely
B. Ensure all expenses are authorized
C. All charges are allowable
D. Notify sponsor for significant changes
E. Supporting documentation exists
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4A. Monitor Project Timely
• Managerial review monthly:– All costs are posted and allowable– Within the period of availability– Unreasonable or unusual activity– Address budget deficits or excess costs
• Notify sponsor if significant changes
– Sign/date documentation evidencing review
See Segregation of Duties – APM’s 2.25.55 and 2.25.55.01
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4B. Proper Authorization
• Ensure all expenses are authorized• PI may delegate authorization:
– Direct knowledge of the sponsored award– Aware of terms and conditions– Aware of compliance requirements– University employee
See APM 2.25.55.01 – Segregation of Duties – Sponsored Programs and 2.25.55.02 – Delegation Form
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4C. Allowable Charges
• Ensure all costs are allowable – Per OMB (A-21) and sponsor requirements
• Allowability requirements: • Reasonable• Allocable• Consistent Treatment• Conform to limitations or exclusions
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4C. Allowable Costs
• Direct costs must be: – Identified specifically for a particular
sponsored award– Directly assigned with relative ease and a
high degree of accuracy– Consistently treated in like circumstances– Supported by documentation
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4C. Allowable Costs
• F&A is: – Incurred for a common or joint objective (e.g. utilities)– Cannot be easily identified with a particular award
• Facilities: depreciation, interest on related debt, operational, maintenance, and library costs.
• Administration: departmental, sponsored projects, student services, and other general administrative costs.
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4C. Allowable Costs
• Certain costs are expressly unallowable: – Alcoholic beverages– Alumni activities– Bad debts– Donations and Contributions rendered– Entertainment– Furnished automobile – personal use – Goods or services for personal use– Housing and personal living– Losses on other sponsored agreements
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4C. Allowable Costs
• Certain costs are unallowable with exceptions:– Contingency provisions– Fines and penalties– Fundraising and investment costs– Lobbying– Pre-agreement costs– Selling and marketing costs– Student activity costs
• Must be specified in the agreement to be allowable!
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4D. Notify Sponsor
• Notify sponsor when there is a: • Change in scope or objective• Significant change in budget• Change in key person specified in award• Absence of the PI for more than 3 months,
or a 25% reduction in time devoted • No-cost time extension
• Work with ORA to notify sponsor
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4E. Supporting Documentation
• What is considered adequate documentation?– Sufficient Documentation should state:
• the charge is allowable, and• the charge directly benefits the related award.
– Substantial Documentation (for cost transfers > 60 days old) should address:• Who, What, When, Where, and Why?• How will error be prevented in future?
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5. Award Closeout & Reporting
• Ensure awards are closed timely– Review notice of award closings– Closeout deficits
• Provide final technical reports• Certify allowability of costs• Documentation exists for all costs
See APM 60.20 – Closing Sponsored Awards and APM 60.07.01 - Certification
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6. Effort Verification Reports
• Ensure all payroll costs directly charged reflect actual efforts
• All EVRs are reviewed, signed, and completed by due date
• Signed by person with suitable means• Update payroll records for differences > 5%.• Note: 100% funding of PI is red flag
See APM 60.32 – Effort Verification Reports
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7. Cost Transfers
• A reallocation of costs to an award after the transaction has occurred
• To correct an error• All cost transfers should be:
– an allowable and allocable charge,– properly documented, and– made in a timely manner.
See BPM 213 – Adjustment of Income and Expense Items
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7. Cost Transfers
• Cost transfers should not be done to:– Meet budget deficits– Avoid restrictions– Shift unrestricted budget– Spend out unused award budget– For other conveniences
• Red flag if excessive transfers at end
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8. Cost Sharing
• At proposal: – Identify funding source– Obtain appropriate approvals– Document exceptions in agreement
• During the award: – Ensure cost sharing requirements are met– All cost sharing is allowable– Documentation exists to support
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9. Subawards
• Determine the need, scope, and budget for subaward
• Ensure proper classification• Monitor progress and deliverables• Review and approve payments• Subject to same compliance requirements
See APM 60.85 – Subrecipient Monitoring Procedures
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Common Issues
• Unallowable costs on projects• Lack of documentation:
– Cost Transfers – Cost Sharing – supporting requirements
• Incomplete and/or late EVRs• Late cost transfers • Purchases in last 3 months of award• Delay in filing final reports
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Impact of Non-Compliance
• Questioned or unallowable costs• Repayments to the sponsor• Fines and/or sanctions• Subject to additional external audits• Jeopardize future funding opportunities• Damage to reputation
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Checklist for Success
Ensure costs are: Authorized in the budget & agreement Charged timely to the project Meet the requirements of allowability
Timely review budget and costs Make timely and allowable cost transfers Appropriately document all costs
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References
Where can I get more information?– OMB Circular A-21 – University Controller’s Office Policies –
APM – Section 60 – Reference Guide for Sponsored Programs – PI Roles and Responsibilities – Facilities & Administration
Fiscal Misconduct Hotline
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Contact Information
• Tina Hyken• Business and Fiscal Operations Specialist• 314.516.5127• [email protected]
• Karen Boyd• Manager, Business/Fiscal Operations• 314.516.5923• [email protected]
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