Post-Award Administration Processes and Transactions

1. Post-Award AdministrationProcesses and Transactions Office of Grants & Contracts Research Admin Education Program, 2010

2. Introductions Maren Boyack Office of Grants & Contracts Administration Grant Management Officer moboyack@alaska.edu 907-474-6073

3. Objectives To obtain an understanding of: • Assumptions and when to request them • The Notice of Award—its contents and importance • The impact of an award’s payment terms with regards to the NOA completion • The importance of an award’s terms and conditions

4. Objectives (cont.) To obtain an understanding of: • Internal controls for expenditures relevant to most accounts • Internal controls for overall sponsored program administration

5. Funding Search Close-out The Life Cycle Proposal Development Reporting Associated Processes Management Routing/Approval Start-up Submission Negotiation

6. Assumptions It is possible to request a Grant and Fund account be established on assumption when the following circumstances exist: • The Sponsor has sent a Letter of Intent to Award; or • The project has been approved by the awarding agency and the start date has passed, but final negotiations have not been completed; or • The awarding agency has approved pre-award costs.

7. Assumptions Generally, the following criteria for pre-award expenditures must be met: • The approval of pre-award spending is made and documented in accordance with UAF procedures prior to the incurrence of the costs; • Costs are incurred within 90 days of the beginning date of the award or budget period;

8. Assumptions • Pre-award costs must be adequately justified (as defined); and • Costs must be allowable under the conditions of the forthcoming grant.

9. Assumptions The benefit of using an assumption account is that it reduces the need to request cost transfers in a future period.

10. Notice of AwardSetup • When an account number is assigned by OGCA, a notice of award setup is sent by OGCA. • The notice is sent to the department providing the Banner account numbers. • The department should review banner entry for accuracy.

11. Notice of AwardGeneral The Notice of Award is the Award Document, it contains: • Technical Reporting Requirements • Proposal is incorporated by reference • Cost Sharing • Indirect Cost Rates • Reporting—Intellectual Property, Fiscal, Technical • Payment Mechanism • Other Information

12. Notice of AwardGeneral • All sponsor awards, contracts, agreements,, subagreements and change notice memos are distributed via campus mail. • Recipient is the department, with the intent the department provides a copy to the PI.

13. Change Notice A Change Notice (modification, change order, amendment) is sent to the department by OGCA when a sponsored project’s account number has not changed, but other information related to the program has changed.

14. Award Terms and Conditions • This training session is geared toward administering federally funded research, therefore the OMB Circulars and University interpretations thereof are presented. • Recall from the Overview module that the terms of an individual award take precedence. • Administrators need to review the award notice to determine the award terms and conditions.

15. Award Terms and ConditionsWaiver of Prior Approvals • Waiver of Prior Approvals is valuable since it allows greater leniency to awardees for self-management of projects. • Specifically, the institution is trusted to perform certain actions without requesting sponsor approval.

16. Award Terms and ConditionsWaiver of Prior Approvals • Look at the Award terms and conditions to determine if the award is subject to waivers of prior approvals.

17. Post-Award Financial Administration • Internal Controls • Specific Types of Expenditures • Other Aspects of Administration

18. Internal Controls for Post-Award Financial Administration • Once an account is established, spending begins. • Administrators should maintain internal controls for major types of non-payroll expenditures. • Internal controls are processes and activities that assist with accurate financial reporting and compliance with regulations.

19. Internal Controls for Post-Award Financial Administration Internal controls can be thought of as proactive measures to prevent inappropriate or erroneous charges to sponsored accounts and to ensure compliance with sponsor terms and conditions.

20. Procurement • Requisitions Results in purchase orders, receiving papers, invoices, check disbursements • Call Numbers (for orders usually less than $2,500, with approved vendors)

21. Procurement • Procurement Card (for orders less than $5,000) • LPO- (for items/services less than $2,500 and orders are filled the same day)

22. Supplies and Equipment Ensure adequate documentation (purchase requisition, purchase order, receiving documentation, invoice) exists for non-payroll charges to the grant.

23. Equipment • If the sponsor retains title to the property that is purchased with program funds, it is referred to as Non-exemptproperty. • Conversely, University has title to Exempt property. • It is important to be familiar with the University’s equipment policy relevant to sponsored programs. Information can be found in the OGCA Manual.

24. Equipment General Purpose • Examples include office furniture, printing and copying equipment, laptops, etc. • The items should not, in general, be charged to sponsored programs. • Exceptions are made if the equipment is for the exclusive conduct of a sponsored program or is utilized as special purpose equipment (ie, a computer necessary to perform and document scientific studies).

25. Equipment General Purpose If an exception applies, the criteria must be fully justified via a memo of justification to be placed in the OGCA official files.

26. Equipment Controls should exist to: • Maintain accurate records of equipment purchased with federal funds; • Physically safeguard assets purchased with federal funds; and • Compensate the federal government for its share of any non-exempt property sold or converted to non-federal use.

27. Equipment Controls should exist to (continued): • Notify the Property Office when equipment is brought to the University by a new faculty member. This equipment needs to be tagged and accounted for. • Notify the Property Office when equipment is moved to a new location (for example, from one lab to another lab).

28. Equipment Examples of controls include: • Affixing property tags to equipment; and • Conducting a physical inventory at least once every two years and comparing the results against the property listing provided by the Property Office.

29. Equipment • Unless otherwise restricted in the award document, the following federal agencies do not require approval for unbudgeted equipment costs: Public Health Service National Institutes of Health Dept. of Energy U.S. Dept. of Agriculture National Science Foundation

30. Equipment • In contrast, the following agencies have some restrictions on the purchase of unbudgeted equipment: Army Research Office Voluntary Health Agencies Always refer to the Notice of Award for any special requirements related to property and equipment.

31. Equipment OGCA is responsible for: • Cosigning any equipment requests that require sponsor approval.

32. Equipment Disposition • OMB Circular A-110 stipulates how equipment, originally funded by sponsors, needs to be disposed. The requirements vary depending on whether the equipment is “exempt” or “non-exempt” equipment. • Typically, the University’s major sponsors will declare equipment purchased from grant funds to be “exempt” equipment.

33. Consultants Certain elements of the relationship are important, including: • the consultant’s work is done independently, without supervision • the consultant has not been a recent employee of the University • the consultant is using his/her own facilities/equipment

34. Subcontracts • Definition: A third party contracted to conduct a significant portion of the scope of work or research plan included in the research proposal • All terms and conditions in an award “flow down” to subcontractors • UAF is ultimately responsible for both the scientific and technical aspects of the research.

35. Subcontracts • Federal regulations require that subcontractor activities be monitored.

36. Subcontracts Examples of the purpose of the monitoring: • Identify subcontractor’s financial problems that could lead to diversion of grant funds • Identify loss of essential personnel • Identify loss of license or accreditation to operate a program

37. Subcontracts Effective monitoring of subcontracts includes: • Regular communication with subcontractors, including questioning progress on research; • Monitoring subcontract invoices against original budgets; and • Performing site visits, if necessary.

38. Subcontracts • Interim financial reports from the subcontractor may indicate there is a lapse in program performance. • A tracking system should be implemented to ensure timely submission of required invoices and technical reports. • If there is a technical problem with a subcontractor, let OGCA and P&CS know as it occurs so appropriate planning can be performed.

39. Subcontracts • The administrator should compare the invoices/requests for payment against the original budget. In particular, fringe benefit rate(s) and the indirect cost rate being utilized on the invoice/request for payment should be compared against the original budget. • Items that appear inconsistent (for example, a different indirect cost rate) should be questioned and appropriate adjustments should be made. • The mathematical accuracy of the invoice should also be verified.

40. Indirect Costs • Compare the indirect cost rate applied on the account with the indirect cost rate applicable to the program. • Read the Notice of Award/Proposal to obtain the indirect rate for the program. • Ensure the indirect costs are applied to the appropriate direct cost base (for example, MTDC).

41. Travel • Travel expenses are reimbursable if they are reasonable and essential to the conduct of the research, subject to approval by the University’s Travel Administration • Always refer to the Notice of Award for any travel-related restrictions • Travel Expense Report is used to request reimbursement for expenses associated with business travel. • Advance payments (registration fees, hotel deposits) should be paid by ProCard or Travel Card.

42. Travel • Except in unusual circumstances, travel authorizations should be approved by one’s supervisor. The grant Pi should also sign to approve charging their grant. • Credit card receipts (along with original receipts/bills) are required for hotel, car rental, airline fare, and all other travel expenses exceeding $25.

43. Travel • Costs will be reimbursed in their actual, reasonable amounts when properly documented. • Wherever possible, educational discounts should be used, in addition to the University’s tax exemption. • Taxes are disallowed on a restricted fund if the tax exemption would have been recognized by the third party.

44. Travel • Regarding foreign travel, reimbursement will be made using the exchange rate at the time of travel. • Use oanda.com or a similar translator site to assist with foreign currency translation, which allows conversion using the rate on the date of expenditure. • For credit card transactions, this would be the amount as converted by the credit card company. • For non-credit card transactions, the traveler should exchange their currency and retain receipt of the exchange rate. This rate will be applied for reimbursement purposes.

45. Travel • Meal and incidental reimbursements are based on per diem or actuals up to the per diem limit. • The IRS allows a business entity to elect one of two methods for meal reimbursement: actual or per diem. Whatever method is chosen, it must be applied uniformly/consistently. Mixing of the two reimbursement methods must be pre-approved by the University’s Travel Administration.

46. Travel Examples of Reasonable travel expenses • Air travel or automobile mileage • Rental charge for a non-luxury vehicle • Taxi, tips, tolls, parking • Lodging (not extravagant) • Business related phone calls

47. Travel Examples of unreasonable travel expenses • Cost of items forgotten to be packed (clothes, toiletries, incidentals like umbrellas) • Lodging and meals for travel companion (track specific costs and only charge those related to the University employee) • Snacks • Meals when available at the conference (ie, part of an overall conference fee) • In-room movies or beverage service • Laundry services • Parking or driving citations

48. Administrative and Clerical (A&C) Salaries Typically treated as F&A costs. However, there are three general instances when A&C salaries may be charged directly to a federal program: 1. The project is defined as a major project or activity; 2. The employee is providing a substantive contribution to the research project; and 3. The nature of the significant direct effort is not what is normally charged to the F&A pool.

49. Administrative and Clerical Salaries Definition of a “Major Project or Activity” A project which is multi-purpose and multi-investigator or interdisciplinary and requires a core administrative budget to ensure the project’s operation and effectiveness. Examples—center grants, P series project grants, cooperative agreements, conference grants

50. Administrative and Clerical Salaries Definition of “Significant Research Effort” The person is performing a research service to the agreement. Examples—data collection (such as surveys), statistical analysis, literature searches