Welcome Please help yourself to breakfast and start your quiz.
Internal Medicine Education Retreat October 16, 2002 Sponsored by Internal Medicine, the Office of the Associate Vice Chancellor for Research Administration, Grant & Contracts, Sponsored Projects Accounting
Welcome! Your Hosts are: • Nancy Buck, Director, Research Education • Joe Gindhart, Director, Sponsored Projects Accounting • Denise McCartney, Associate Vice Chancellor for Research Administration • Nancy Rhodes, Executive Director, Finance and Administration, Department of Medicine • Terry Thurston, Director, Grants & Contracts • Cindy White, Director, Research Office
Planning Group • Nancy Buck • Tami Evans • Joe Gindhart • Daniel Korte • Donna Lewis • Denise McCartney • Mary Lou Rheinheimer • Nancy Rhodes • Terry Thurston
Housekeeping • Food—Coffee provided all morning. Breakfast from 7:30 – 9:00. • Breaks—Around 9:10. 10 minutes (see agenda). • Phones—One at the top of the escalators to the right at the end of the circle coach. • Restrooms—On the North side of the building in the West corner. They are clearly marked. • Questions—Raise your question flags as they come up, or write them on the blue question sheet for detailed answer via email.
Today’s Agenda 7:30 Registration and Continental Breakfast 8:00 Introduction and Opening Remarks 8:20 Quiz 8:40 Table Discussion of Vignettes Preparing the Proposal Budget, GBUD: Entering the Proposal Budget 9:10 Break—10 Minutes 9:20 Table Discussion of Vignettes Administrative/Unallowable Costs, Cost Sharing, PARS/PCTs 10:50 Large Group Review of Vignettes 11:50 Next Steps 12:00 Adjourn
Today’s Goals • Enhance understanding of federal regulations governing the conduct and management of sponsored funds • Enhance understanding of WU policies • Enhance understanding of research administration at WUMS • Share best practices • Provide useful tools
Research Administration Process The three standard components of research administration are Pre-Award, Award and Post-Award. These three components include seven (7) subprocesses comprising the end-to-end research administration process. Pre-Award Award Post-Award Identify Funding Prepare & Approve Protocols Negotiate and Accept/ Contract Manage Finances Report & Close-out Award 2 4 Prepare & Approve Proposals Receive and Set-up Award 1 3 5 6 7
Research Administration Process The seven major research administration subprocesses encompass the following activities: Identify Funding includes identification of public and private funding sources 1 Prepare & Approve Protocols includes reviewing and approving protocols for compliance with animal & human subject regulations, environmental safety and certifying Conflict of Interest disclosure reports 2 Prepare & Approve Proposals includes preparing, reviewing and approving proposals for compliance with all division, department, school, university, federal and other agency requirements and regulations 3 Negotiate and Accept Award/Contract includes negotiating terms of award/contract with sponsor and revising proposal, budget, terms and conditions 4 Receive & Set Up Award includes assigning and establishing the account and fund number and entering project budget into financial system 5 Manage Finances includes monitoring and approving project expenditures and recording financial transactions 6 Report & Close-out Award includes preparing interim and final financial and technical reports 7
Quiz 1. True or False? Key Personnel" means everyone who will be working on the grant. False– According to the NIH, "Key Personnel" are those individuals (including the PI) who contribute in a substantive way to the scientific development or execution of a project.
Quiz 2. True or False? The NIH must be notified if there is a change in PI during the course of a sponsored agreement. True – Per the NIH Grants Policy Statement, the grantee is required to notify NIH if the PI or other key personnel named in the NGA will withdraw from the project entirely, be absent from the project during any continuous period of three months or more, or reduce his/her time devoted to the project by 25 or more percent from the level that was approved at the time of award. NIH must approve any alternate arrangement, including any replacement PI or other key personnel proposed by the grantee.
Quiz 3. True or False? The PI hasn't received the human subjects protocol approval yet, but G&C can still set up the award. False – A grantee may not expend Federal funds for research involving human subjects unless it has an Office for Human Research Protections-approved assurance of compliance with the requirements of 45 CFR 46 and the research has been approved by an Institutional Review Board in accordance with the requirements of 45 CFR 46. (See NIH Grants Policy Statement.)
Quiz 4.True or False? A Department Administrator may sign a Prior Approval Request as long as the PI is aware of the post-award changes being made. False – The Principal Investigator (PI) should sign the Prior Approval Request. As the individual primarily responsible for the sponsored agreement, the PI is attesting by his/her signature to the accuracy of the changes being made.
Quiz 5. True or False? A "Fixed Price" contract specifies that a fixed dollar amount will be provided for a specific period of time regardless of actual expenses incurred. True – A fixed-price contract contains the provision that the contract will cover a specific period of time and a fixed dollar amount is issued for that time period regardless of actual expenses. In the majority of the cases unspent funds remain with the University.
Quiz 6. True or False? If grant funds run out during the grant's active budget period but work on the grant continues, the department may absorb these costs without using cost sharing accounts. False – The costs assigned to sponsored projects should be accounted for on those agreements by use of a "V" account when the department is absorbing those costs. If a "V" account is not used, the department-absorbed costs will not be captured in the correct indirect cost pool. (See "Guidelines for Direct Charging to Grants," p. 11.).
Quiz 7. True or False?The award terms and conditions allow rebudgeting on this NIH award. Therefore, the PI can charge the project for administrative salary costs that were not originally budgeted. False – If the original budget did not include administrative and clerical salary costs, any subsequent rebudgeting is subject to the granting agency's rebudgeting rules and Circular A-21. Circular A-21 says that administrative and clerical salary costs cannot normally be charged directly to a grant. (See "Guidelines for Direct Charging to Grants," Q&A p. 4.).
Quiz 8. True or False? Since the PI no longer needs a piece of equipment acquired with federal funds, it can be sold to another PI as long as it is also purchased with federal funds. False – Federal Circular A-110 states that when the recipient no longer needs equipment purchased for the original project or program, the recipient institution shall use the equipment in connection with its other federally sponsored activities. Allowing the second PI to "buy" equipment purchased with federal funds with other federal funds amounts to double charging the federal government, and is not allowed. (See "Guidelines for Direct Charging to Grants," p. 9.).
Quiz 9. True or False? Dr. Jones revised his effort on grant XYZ from 30% to 40% on his last PAR report (1/XX – 6/XX). Accordingly, the department must process a PCT that will increase the salary (and related benefits) on the grant. True - Upon changing a PAR, the individual should prepare a Payroll Cost Transfer to transfer charges to the proper accounts in accordance with the certified actual activity effort. (See Sponsored Project Accounting Personal Activity Reports (PARs)).
Discussion Group Directions • Review each vignette and discuss questions in the time allotted • Use the reference materials at your table to help • Raise the colored flag at your table if you need advice from our roving subject matter experts • Note taker should document the main points discussed on notepad provided. • Be prepared to discuss the issues raised during the group discussion during the large group review
BREAK 10 Minutes -phone at top of escalators -restrooms on North side of this level -coffee in the hallway outside the door
Vignette #1 Proposal Budget
Proposal Vignette #1 1)Dr. Mel Gibson’s institutional base salary is $172,000. What is significant about this amount? What important statement(s) should be included in the justification regarding Dr. Gibson’s salary? Dr. Gibson’s institutional base salary is over the NIH salary cap of $166,700. To determine the maximum amount of salary that is chargeable to the grant, multiply the percent of effort times the salary cap amount of $166,700 (the Grants Budgeting System has a feature to accommodate salary caps). If the institutional base salary is not provided, it is particularly important for those personnel whose salaries are over the cap to provide an explanation in the budget justification indicating that the actual institutional base salary exceeds the current salary limitation. NIH will use the information available in the existing application and make adjustments for the salary limitation based on information available at the time of award. Contact your Grants & Contracts Preaward Grant Analyst for template language options to use in the budget justification related to the salary cap. Reference: PHS 398, NIH GPS, WU NIH Salary Cap Policies and Procedures
Proposal Vignette #1 2)Should the Institutional Base Salary column be completed on the budget page? The PHS 398 instructions state that an applicant organization may choose to leave the institutional base salary column blank. However, PHS staff will require this information prior to award. It is especially important to provide and explanation in the budget justification for those individuals whose salary exceeds the NIH salary cap (see explanation in #1 above).
Proposal Vignette #1 3)Is there anything that is significant or questionable about Dr. Gibson’s amount of effort? The 100% effort requested on this proposal for Dr. Gibson would not be appropriate if he spends any of his time on other activities such as teaching, clinical activities, writing competitive grant proposals, or other administrative responsibilities (committee representation, departmental administration, etc.). The salary associated with the effort related to these activities would not chargeable to this grant as direct costs. Reference: OMB A-21, WU Guidelines for Direct Charging Costs to Grants, WU Finance Office web site
Proposal Vignette #1 4)Are there personnel costs listed on this budget for whom charging costs to this grant would normally be unallowable? For which personnel and why? §The stipend for Meg Ryan, a postdoctoral fellow, cannot be charged to a federal grant. Per the NIH GPS: “Stipends are not allowable under research grants even when they appear to benefit the research project.” §Salary for Russell Crowe, the Administrative Assistant, would normally not be allowable as a direct cost, especially on an R01 grant, unless there are special circumstances (see #6 below). Reference: NIH GPS, OMB A-21, WU Guidelines for Direct Charging Costs to Grants, WU Administrative Cost Policy & Procedures
Proposal Vignette #1 5)Are there personnel listed for whom special justification is required for the costs to be charged to this grant? For which personnel, and what should the justification include? Special justification would be required for Russell Crowe, the Administrative Assistant. It is highly unlikely that an administrative assistant would be charged to an R01 grant for 100% effort. Per the WU Guidelines for Direct-Charging Costs to Grants, the administrative or clerical salary is permitted to be included in the grant proposal only if “you identify and budget the extent of planned administrative or clerical time required, justify the unlike circumstances and document the specific association of the administrative or clerical duties with the grant. …. The documentation of unlike circumstances and specific association can be accomplished in one of two ways: §There is an unusually high level of administrative or clerical work required by an unusually large and complex project, such as a program project, etc., or §The administrative or clerical work is related to the distinctive scientific and technical requirements of the work of the grant, such as data collection, maintaining subject/patient data, phone surveys, etc.” The justification of the unlike circumstances requirement must be included in the grant proposal. Reference: WU Guidelines for Direct Charging Costs to Grants, OMB A-21, WU Administrative Cost Policy and Procedures
Proposal Vignette #1 6)Tom Cruise is a part-time employee (.75 appointment). The asterisk (*) on the budget page identifies him as part-time, as required in the PHS 398 instructions. What should be included in the justification? Provide a full explanation about the part-time status of the individual. Per the PHS 398 instructions, if an appointment is less than full time, e.g., 50 percent time, identify with an asterisk (*) and provide a full explanation under “Justification” on Form Page 5.” For example: “Tom Cruise, Research Technician (.75 appointment) will devote 100% effort to this project.”
Proposal Vignette #1 7)For which personnel should a narrative description of their specific functions be provided on the budget justification page (form page 5)? For all personnel. Per the PHS 398 instructions, “Describe their specific functions under Justification on Form Page 5. Provide budget narrative for ALL personnel by position, role, and level of effort. This includes consultants and any “to be appointed” positions.”
Proposal Vignette #1 8)Dr. Mel Gibson and Dr. Nicole Kidman are key personnel on this project. What are the special requirements associated with key personnel? §Per NIH guidelines, for any key personnel, an effort decrease of 25% or more from the level that was approved at the time of award (for example, a proposed change from 40% effort to 30% or less effort) must be reported to the agency Reference: NIH GPS §Conflict of interest disclosure must be current at proposal submission, with any conflicts or potential conflicts managed, reduced or eliminated prior to expenditure of funds under an award. G&C currently checks COI disclosure for faculty, and this may be extended to non-faculty key personnel in the future. Reference: 45 CFR Part 50, PHS 398 Instructions, WUSM Conflict of Interest Policy §For those projects which include the use of human subjects, all key personnel who are involved with the human subjects portion of the research must complete the WU human subjects education requirement (implemented as a result of federal policy requirements).Certification of of the fulfillment of this requirement, signed by the PI and an institutional official, must be submitted to NIH prior to award. (G&C has template letters for your use.) Reference: WU Human Studies Education Program Policy, NIH Policy
Proposal Vignette #1 Non-Personnel Costs (Consultant Costs, Equipment, Supplies, Travel, Patient Care Costs, Alterations & Renovations, Other Expenses) 1)Are there costs listed that are questionable or not normally allowable as direct costs? What justification would need to be provided to enable these costs to be charged as direct costs? The following costs are normally not allowable or are questionable as direct costs: §DSL Line Charges §HP LaserJet Printer §Journals/Books §Postage §“Per diem” meal charges under Travel are not allowable. The actual cost of the meals should be charged. (refer to WU Travel Policy) Per OMB A-21 and the related WU Guidelines for Direct Charging Costs to Grants: These costs may only be requested in the grant budget if they can be specifically identified with this particular sponsored project, and there are special, or unlike, circumstances. To request these charges as direct costs in this budget, there must be appropriate justification indicating what the direct relationship is of these costs to the scientific activities of the grant, and explaining the unusual circumstance that exists related to these items. Remember the “Golden Rule”: “Direct costs are those costs that can be identified specifically with a particular sponsored agreement…..or that can be directly assigned to (such activity) relatively easily and with a high degree of accuracy.” Reference: OMB A-21 F.6.b, WU Guidelines to Direct Charging Costs to Grants, NIH GPS
Proposal Vignette #1 2)What costs are listed in the wrong category? Under what category should these items be listed? §The computers listed in Equipment should be moved to Supplies. §These charges listed under Supplies should be moved to Other Expenses: DSL line charges, Journals/Books (only if appropriately justified – see #1 above) §If the MRI scans or the CT scans listed under Patient Care Costs are provided and billed by Washington University, these costs should be listed under Other Expenses §The Mice purchase costs listed under Other Expenses should be moved to Supplies Reference: PHS 398, NIH GPS, WU BUOB list
Proposal Vignette #1 3)Is further detail needed to describe any of the items listed (as required by the PHS 398 instructions)? Provide justification for the non-personnel items on Form Page 5. The PHS 398 gives detailed instructions regarding the justification that is required for the categories of Consultant Costs, Equipment, Supplies, Travel, Patient Care Costs, Alterations and Renovations, Other Expenses. For example: §For Dr. Ruth, the Consultant, provide the following information in the budget justification (Form Page 5): her organizational affiliation, the services to be performed, the number of days of anticipated consultation, the expected rate of compensation, travel, per diem, and other related costs. §The Disposable Supplies must be itemized in separate categories, such as glassware, chemicals, radioisotopes, etc. (either on the budget page or in the narrative justification). Categories in amounts less than $1,000 do not have to be itemized. §The number of animals (mice) to be used must be stated. §Travel costs for Dr. Gibson must be itemized and justified on Form Page 5. Provide the purpose and destination of each trip and the number of individuals for whom funds are requested. §Refer to the PHS 398 instructions for justification needed for Patient Care costs.
Proposal Vignette #1 Consortium/Contractual Costs 1)Each participating consortium/contractual organization must submit a detailed budget for both the initial budget period (Form Page 4) and the entire proposed project period (Form Page 5). Where should these pages be placed in the application? The budget pages of each consortium/contractual organization should be placed after the WU Form Page 5, and numbered sequentially (do not use 5a, 5b, 5c, etc.)
Proposal Vignette #1 Consortium/Contractual Costs 2)What are two other application form pages that you should you obtain from the consortium institution that will not be submitted with the application to NIH, but are important for our internal purposes? (These pages must be submitted to G&C for review.) Be sure to obtain the Face Page (signed by the institutional official and PI) and the Checklist Page from each consortium/contractual institution. Submit the originals of these two forms to G&C with the proposal. This is essential in order for our institution (G&C and RO) to verify that the consortium budget has been approved by the appropriate institutional official, and enables verification of the direct and F&A costs requested Refer to the PHS 398 instructions and the NIH GPS for additional instructions and policy information on consortium/contractual costs.
Vignette #2 Grants Budgeting
Financial Vignette #1 Administrative and Unallowable Costs
Financial Vignette #1 Administrative / Unallowable Costs Noted below is a recent email that was sent by a PI to his departmental administrator. Please review the message and be prepared to answer/discuss the questions below. To: Marge Since I just got that new NIH grant (RO1-B), my lab personnel and I met last Friday to discuss what items are needed to get it going. This new project is similar to my other NIH grant (RO1-A) and the project funded by the Merck (fixed price) contract so there is going to be some overlap in the use of supplies and other stuff. We’re going to need a number of items for these projects during the next week or two. Please purchase these items and charge them as indicated: A) Three boxes of pens, two boxes of paperclips, two boxes of manila folders, a dozen blank CDs, a toner cartridge for my office printer, four three-ring binders and two file cabinets (two drawer – lateral). Charge this stuff to my two NIH grants (RO1A & B). Answer: Regular office supply type items cannot be directly charged to a federal grant (per OMB Circular A-21). The federal government funds office supply items via a portion of the F&A rate, therefore, charging these costs directly to the grant would be considered “double dipping”. The office supplies should be charged to a departmental account.
Financial Vignette #1 Administrative / Unallowable Costs B) The coffee maker in the lab has been on the fritz lately, so just go ahead and get a new one. Charge half of it to my two NIH grants (RO1A & B) and the rest to the department. Answer: Normal office type items and/or small equipment (coffee makers, microwave ovens, small refrigerators…) should not be charged to federal grants because there is not a clear and distinct correlation to the project. These items could be considered personal in nature or food/beverages, which are both unallowable costs per A-21. The coffee maker should be charged to a departmental account.
Financial Vignette #1 Administrative / Unallowable Costs C) Some chemicals spilled on to Moe Green’s lab stool last week and now it’s not usable. Go ahead and get him another one and charge it to my Merk grant. Answer: The stool would not be an allowable direct cost on a NIH grant, however, Dr. Corleone can charge it to his Merck grant.
Financial Vignette #1 Administrative / Unallowable Costs D) My subscription to the Journal of Advance Widgetry is almost up, so please renew it, ASAP. Split the cost between my NIH (RO1A & B) grants and the Merck contract. Answer: Normally, the federal government considers the costs of books and journal subscriptions to be an indirect cost, which they fund via the library portion of the F&A rate. If the PI can establish/document the direct correlation of the journal to his NIH grant(s) (i.e., “an identifiable cost objective”), then it could be charged as a direct cost. In the case noted above, SPA would advise the PI to charge the entire subscription cost to the Merck contract or some other departmental account.
Financial Vignette #1 Administrative / Unallowable Costs E) I just saw Dr. Clemenza from Radiology and he’s got a new Dell laptop PC. A laptop would be great for when I have to go out of town next month. It shouldn’t be over $5k, so go ahead and charge it to my new NIH grant (RO1-B). Answer: General-purpose equipment/items can not be charged to federal grants. Laptops and PC’s can be considered general purpose and special purpose items, therefore, the PI should provide additional detail about the intended use of the item and how it relates to the NIH grant. If the cost of the laptop is less than $5,000, then the item is not considered equipment, however, SPA would still require a the PI to describe/document the general or special purpose nature of the item.The department can also divide the cost of the item between research and departmental accounts based upon the intended usage (i.e., 25% to research grants, 25% to administrative accounts, 50% to instructional accounts).
Financial Vignette #1 Administrative / Unallowable Costs F) This Friday I want to bring pizza in at lunch for the lab staff as kick off for the new NIH grant. Go ahead and set that up. I’ll give you some cash to pick it up and then just do a check request to reimburse me. Charge the pizza to the new NIH grant (RO1-B). Answer: Food and beverages are considered unallowable costs on federal grants. Working lunch/dinners are also considered unallowable costs. The pizza should be charged to a departmental and/or non-federal funding source. Departmental policies regarding the reimbursement of such costs should also be considered.
Financial Vignette #1 Administrative / Unallowable Costs G) We also got the bill for the new hard drive that was installed in the PC that runs the “laserthing”. Since we bought the “laserthing” out of the equipment budget on my initial NIH grant (RO1-A), charge the hard drive bill to it, too. Answer: It appears that the hard drive could be directly related to the NIH grant. The PI should provide a more detailed description of the “laserthing” and it’s relation to the grant and how the hard drive will directly benefit the project in the Trail Doc.
Financial Vignette #1 Administrative / Unallowable Costs H) I picked up a new Palm Pilot at Best Buy over the weekend. It’s really going to help me get organized and keep track of my schedule. I’ll drop off the receipt so you can process a check request to reimburse me. It was about $499 plus tax. Charge it to my NIH (RO1A & B) grants and the Merck contract. Answer: The Palm Pilot is considered a general use item, therefore, it should not be charged to the NIH grants. This item should be charged to the Merck contract or some other non-federal funding source.
Financial Vignette #1 Administrative / Unallowable Costs I) I’ve got a receipt from dinner last week with Dr. Luca Brassi from Cornel Med School. We talked about his current NIH research projects, which are similar to mine, and the possibility of a future collaborative proposal. Put through a check request through to reimburse me. Charge my NIH grants. Thanks for your help. Dr. V. Corleone Answer: Meals with current or future collaborators are considered unallowable costs on federal grants. Meals incurred while on travel status and meals provided to subjects/participants in the study are the only types of food costs deemed allowable, per A-21. The dinner should be charged to a departmental and/or non-federal funding source. Departmental policies regarding the reimbursement of such costs should also be considered.
Financial Vignettes #2 Cost Sharing