Compliance Report Effort Reporting by linzhengnd

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									             Office of Sponsored Programs




    Effort Reporting:
   An Introduction to the
   Concepts and UVA Practices


Andrew Bedotto, Effort Reporting Coordinator & Cost Sharing
Specialist

Sharon Boyd, Director – Outreach and Compliance
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             Office of Sponsored Programs



           Course Objectives
 The Concepts and Federal Requirements
 Non-Compliance Risks & Audit Activities
 UVA Practices to Meet Federal Requirements
 Labor Distribution (LD) Adjustments
 Special Considerations Affecting Effort Reporting
 A Closer Look at UVA Effort Reports
 Summary Points along with Questions & Answers
 Case Studies
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 Roles/Responsibilities – A Team Approach
                      Office of Sponsored Programs




       Why Do We Do Effort Reporting?

• It is required by Federal regulations*

• Proves that effort was expended toward
  technical project goals

• Provides official time/effort records used during
  audits – DOCUMENTATION

• Provides information as required by Medicare
  reporting requirements
*OMB Circular A-21, Section J.10, Compensation for Personal   3
   Services
                   Office of Sponsored Programs


           What is it? Understanding The
           Concepts of Effort Reporting
• A REASONABLE REFLECTION and confirmation of
  effort expended on specific sponsored research awards
  and other activities
• A record of 100% of an individual‟s “institutional effort”
  over a pre-determined period of time

• INSTITUTIONAL EFFORT includes:
      – Research activities
      – Instruction/Other non-sponsored activities
      – Administration activities
      – Direct Patient Care and Hospital activities            4
               Office of Sponsored Programs




      What is it? Understanding the
    Concepts of Effort Reporting (Con‟t.)


• Effort reporting documents Actual Effort,
  which may be different from payroll dollars
  expended

• Effort reporting is NOT a certification of
  payroll dollars paid
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                  Office of Sponsored Programs



 Effort Reporting Requirements
Federal regulations* require recipients of Federal funds to
have a method to document and certify effort expended
toward sponsored awards and other institutional
activities, whether those costs were treated as direct or
F&A costs.

Specifically to document and certify:
– effort worked on federal awards,
– cost shared effort to federal awards paid from other sources,
– patient care activities/hospital for Medicare reporting,
– total institutional effort (equal to 100%)

*OMB Circular A-21, Section J.10, Compensation for         8
Personal Services
               Office of Sponsored Programs


      Risks of Non-Compliance with
        Regulations and Practices
 Financial penalties from audit findings released
  to agencies and the public

 Loss of expanded authorities and participation in
  FDP – greater audit oversight

 Potential reduction/loss in sponsor funding

 Institutional and individual professional integrity
  compromised
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 Suspension, debarment, exclusion of individuals
              Office of Sponsored Programs


Audits: Will Involve Questions
 To Administrators and PIs
 Was certification completed by established deadline?

 Does certified effort reasonably reflect actual work?

 Do payroll charges reasonably support effort certified?

 Were payroll adjustments processed timely? ( LD Cost
  Transfers)

 Did someone with first hand knowledge of work performed sign
  and date the effort report?

 Does the Investigator understand what information is being
  certified?                                                 10
             Office of Sponsored Programs



  UVA‟s Practice: Meeting Effort
    Reporting Requirements
As guided by Circular A-21.J.(10), UVA uses
an ‘After-the-Fact’ certification method

This method relies on the accurate
distribution of salaries and the certification of
actual effort (both direct pay and cost
shared) supported by periodic activity reports
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             Office of Sponsored Programs


UVA‟s Practice: Who is Captured in the
      Effort Reporting Process?
All employees whose salary is directly paid from
  a sponsored project,

All employees who have committed (Mandatory
  or Voluntary) cost shared effort in proposals,

All Clinicians, regardless of whether providing
  effort to a sponsored award (Medicare
  reporting)
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             Office of Sponsored Programs



  UVA‟s Practice: The Key - Accurate
    Labor Distribution Schedules
• In the Integrated System, „end date‟ the labor
  schedule corresponding to the end date of the
  project(s) charged with the salary

• Process any necessary labor distribution
  adjustments in a timely manner to minimize
  corrections to effort reports

• Maintain frequent contact with PI for changes13in
  levels of effort on individual sponsored awards
-Capture
Commitments
Of Cost
Sharing




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                      Office of Sponsored Programs


              Certification: Authorized
                       Persons
In order of preference:
• Individual employee/PI
• Individuals with first hand knowledge of actual
  work performed
• Department Chair/Designee

  „Other technical‟ personnel roll up for certification under the
                      responsible PIs name.

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• Administrators should not certify effort reports!
              Office of Sponsored Programs


    What Does Re-Certification of an Effort
             Report Involve?
• EXPOSURE- Reveals weakness in the effort
  reporting process

• Review level of effort and re-certify report

• Initial/sign the change

• Date the change

• Document why the change occurred (LD
  Adjustments)                                   16
               Office of Sponsored Programs

   What Are LD Adjustments and How
        Do We Manage Them?
• IT IS A COST TRANSFER!

• ACTUAL EFFORT DRIVES ACCOUNTING

• The reasons why the adjustment is necessary AND

• The reasons why the costs are allocable to their new PTAO
  must be clearly documented in the comment section of the
  transaction (default language is not sufficient)

• Adjustments past 90 days from the transfer date of the
  transaction require retro approval through OSP whenever a
  „G‟ project is involved

• Procedure 8-22 provides guidance on LD adjustments    17
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         Office of Sponsored Programs


  Certification: The End Result
  If effort is not properly certified and
 documented, salary charges must be
   removed from sponsored awards


  THERE IS NO OTHER APPROVED
 DOCUMENTATION METHOD THAT
REPLACES AN EFFORT REPORT FOR
INSTITUTIONAL EFFORT INCLUDING
   PATIENT CARE AND HOSPITAL
            ACTIVITIES       20
• Workshops:
  Effort Reporting: An Introduction to the Concepts and U.Va. Practices
  Introduction to Cost Accounting Standards (CAS)
  Advanced Cost Accounting Standards (CAS)
  The ABC‟s and D‟s of Cost Transfers Involving Sponsored Programs
  Working Successfully with Grants.gov

• Educational Outreach:
  OSP Resource Library
  Introduction to Export Controls - Web PowerPoint presentation
  Certified Research Administrators (CRA) Study Sessions
  NCURA Video Teleconferences
  A Primer on Sponsored Programs Administration
  Monthly Brown Bag Discussions

• Under Construction:
  Comprehensive Education Program - Certification
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            Office of Sponsored Programs

     Special Considerations:
        Committed Effort
Commitments of effort are made in award
 documents in two (2) ways:

• Direct salary charged to sponsored
  awards
               and/or
• Promise of a % of effort or salary dollars to
  be expended & paid from other funding
  sources toward the technical goals of the22
  project – Cost Share
              Office of Sponsored Programs

       Special Considerations:
         Cost Shared Effort
• Cost shared commitments are a part of 100%
  of “institutional effort”

• ALL effort must be certified on the official effort
  report

• Re-budgeting of key personnel salary to other
  cost categories may result in cost share –
  Advise OSP of these changes in order that
  effort reports can be generated

• Cost shared dollars/effort are not tied directly23
  to sponsored awards in the Integrated System
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                    Office of Sponsored Programs

         Special Considerations: K Award
         Salary Cap and Minimum Effort
• “K Awards” - NIH Career Development Awards
• $75,000 Salary Cap

• 75% minimum effort commitment (Program specific - may be
  reduced to 50% in the last years of the award)

• Part of the minimum effort commitment can be expended on
  another award as long as this award contributes to the goals
  of the K

• Salary cannot be supplemented by another Federal award
  without prior written approval from the Sponsor         25
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                     Office of Sponsored Programs

            Special Considerations:
               NIH Salary Cap
• The National Institutes of Health agree to support only up to
  the amount of the current salary cap as direct payments to
  award recipients. Additional salary payments are to be
  supported by other funding sources and cannot be claimed
  as cost share to meet commitments.

• NIH:http://grants.nih.gov/grants/policy/salcap_summary.htm

• Calculation of $$ to be entered to Labor Distribution system
  - (Effort % X NIH Cap)

• Calculation of % of effort to be entered to Labor Distribution
  system - (Effort % X NIH Cap)/UVA Base Salary
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       Office of Sponsored Programs




Some Common Certification
        Errors




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                     Office of Sponsored Programs


       Course Summary: Key Points
• Certification Variance
  – If actual effort is within a reasonable % of salary charged,
    effort should be recorded at the payroll percentage
    amount
• Certification Statement
  – Critical…..”I certify that…..”
  – Administrators should not certify effort reports
• Cost Share
  - Re-budgets out of key personnel/PI/PD salary, decisions to
  stop direct pay from the sponsored award and pay from
  other funding sources, etc. need to be communicated to 36
  OSP in order that an effort report will generate accurately
                    Office of Sponsored Programs

         Course Summary: More Key
                  Points
• Re-Certifications and Adjustments
  - Adjustments to labor should be processed prior to effort
  report generation (that 45 day window)
  - Adjustments 90 days past the transfer date of the
  transaction require retro approval through OSP (See
  Procedure 8-22)
  - Re-certifications reflect weaknesses in the
  review/certification process
  - Re-certifications require new signature and date

• Total Effort
  - Always = 100%
  -   Includes activities for which compensation is received
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• Communication
                    Office of Sponsored Programs


         Course Summary: More Key
                  Points
• Reviewing Effort Reports
  - Ensure that all individual sponsored awards/projects are
  shown in Section I (direct pay and cost share)
  - Be aware of significant changes in effort (25%)
  - Certify in whole percentages

• Timeliness/Returning Certified Effort Reports To OSP
  - To OSP as soon as certified but no later than 90 days from
  distribution
  - Original copy of effort report is retained by OSP
  - Certified in ink                                        38
              Office of Sponsored Programs

      Effort Reporting Course
             Objectives
 The Concepts and Federal Requirements
 Non-Compliance Risks & Audit Activities
 UVA Practices to Meet Federal Requirements
 Labor Distribution (LD) Adjustments
 Special Considerations Affecting Effort Reporting
 A Closer Look at UVA Effort Reports
 Summary Points along with Questions & Answers
 Case Studies
                                                  39
 Roles/Responsibilities – A Team Approach
                      Office of Sponsored Programs

           Resources: Where to Go for
                    Help?
• OSP Effort Reporting Coordinator: Andrew Bedotto
  Ab3ah@virginia.edu     4-3852

• Departmental/School Contacts

• Policy/Procedure Web Site -
  http://virginia.edu/finance/polproc/proc/8-31.html

• OSP Web Site - http://www.virginia.edu/sponsoredprograms/

• Attend OSP Educational Sessions – See both OSP and HR
  websites for details
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• Subscribe to the “OSP Connection”
Office of Sponsored Programs


QUESTIONS?




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