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Principal Investigator Presentation Spring 2009

Principal Investigator Presentation Spring 2009. Neta Fernandez, Director, Office of Grants and Contracts Norma Noel, Associate Controller, Sponsored Projects Accounting. Goal: . Provide an overview of the NMSU’s Research Administrative Offices by reviewing the roles of:

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Principal Investigator Presentation Spring 2009

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  1. Principal Investigator PresentationSpring 2009 Neta Fernandez, Director, Office of Grants and Contracts Norma Noel, Associate Controller, Sponsored Projects Accounting New Mexico State University

  2. Goal: • Provide an overview of the NMSU’s Research Administrative Offices by reviewing the roles of: • Office of Grants and Contracts • Sponsored Projects Accounting New Mexico State University

  3. Objectives: Review Departmental Procedures Review Regulations Review the Award’s Progression New Mexico State University

  4. Overview: Definition • Sponsored Research Administration – the office(s) that sits between the researcher and the sponsor and has responsibilities to both entities. A key role of the office(s) is to respond to the expectations of both the researcher and the sponsor. Sponsored Research Administration: A Guide to Effective Strategies and Recommended Practices, National Council of University Research Administrators. 2008 by Atlantic Information Services, Inc. and NCURA. New Mexico State University

  5. Overview: • Early Days of Research Administration • Outbreak of World War II increased federal funding to colleges & universities from $15 million to $1.3 billion by 1966 • Number of research offices grew also – almost three times as many offices est’d during 1961-1970 than in 1945-1960 • Higher Education recognized the need for “establishment of wide and stable policies for the management of research” • The era of increased regulation was on its way as indicated by the Executive Branch - Bureau of the Budget Report in1966 • The report attempted to identify administrative procedures which fostered excellent research, assisted in strengthening the institutions engaged in federally funded research, and guarantee prudent stewardship of public funds New Mexico State University

  6. Overview: • Increased Regulations, Focus on Compliance • 1970 and 1980s saw the period of greatest growth in regulations and compliance activity • Research administration expanded role and now included ensuring implementation of all sponsor requirements and assisting with the closeout activities • OMB Circular A-21, Cost Principles for Educational Institutions(1958, 1979, 1980s, 2004) • OMB Circular A-110, Uniform Administrative Requirements for Grants and Other Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations (1976, 1993, 1999) • Single Audit Act 1984, implemented in 1985 via OMB Circular A-133, Audits of State, Local Governments and Non-Profit Organizations (2003) New Mexico State University

  7. Overview: • Unfunded Mandates • Growth & complexity of federal regulations continued into 1990s and currently – American Recovery and Reinvestment Act 2009 • Key changes were the number of requirements imposed on institutions whose associated costs were not recoverable through facilities and administrative (F&A) rates because of federal cap on the administrative portion of the rate • The “unfunded mandates” impacted research administration activities • Conflicts of interest, misconduct in science and cost accounting standards were just three examples of such mandates • As a result, sponsored program officers cont’d to shift from pure service functions to control and compliance as a primary “reason for being” New Mexico State University

  8. Office of Management & Budget (OMB) OMB Website - http://www.whitehouse.gov/omb/ OMB A-21 - http://www.whitehouse.gov/omb/circulars/a021/a021.html OMB – A-110 – http://www.whitehouse.gov/omb/circulars_a110/ OMB – A-133 - http://www.whitehouse.gov/omb/circulars_a133/ New Mexico State University

  9. Sponsored Projects Accounting (SPA) Spring 2009 New Mexico State University

  10. Agenda: • SPA’s Role • Definitions • Regulations • Progression of the Award • Audits New Mexico State University

  11. SPA Overview: Duties and Responsibilities Sponsored Projects Accounting, a group of professional accountants and support staff within Business, Finance and Human Resources focused on customer service, will assist the University by providing technical accounting support through financial reporting, transaction processing expertise, and interpretation of governmental regulations, thereby ensuring the data integrity of the financial information of the University. We are uniquely positioned to provide financial accounting services to our internal customers within the context of the requirements of our external sponsors and auditors. source: Sponsored Projects Accounting website (http://www.nmsu.edu/%7espa/) New Mexico State University

  12. SPA Overview • SPA reports to the Controllers Office within Business, Finance and Human Resources • Post award administration – responsible for what happens after the proposal is submitted and the award is made New Mexico State University

  13. Organizational Chart: New Mexico State University

  14. Restricted Operating Expense $ Millions 123.4 122.4 110.4 109.1 Source: NMSU Annual Financial Reports 2008 and 2007 New Mexico State University

  15. Facts: • Fiscal Year 2008 Active Awards (status <> T): • 2,335grants/contracts/cooperative agreements • 4,470 funds • 8,312 indexes New Mexico State University

  16. Information Systems • SunGard Higher Education – Banner Finance • Sponsored Research Accounting Module, official system of record • Xtender – • Banner’s Document Management System • Documents are launched from Banner • Provides imaging and document management • Certified by the State of New Mexico • COGNOS – • Banners Report Writing Database New Mexico State University

  17. Information System Access • Banner – Request for Computer Systems Access - http://www.nmsu.edu/~boffice/forms/FSA_RequestForComputerSystemsAccess.pdf • Xtender – once Banner access is granted email SPA@nmsu.edu • Cognos – Request for NMSU Cognos Reporting Portal Access (requires Dean/VP approval) http://www.nmsu.edu/~boffice/forms/ADM_CognosReportingSecurity.pdf • Human Resources – Training & Development • Newest: COGNOS Training – April 2009 New Mexico State University

  18. Definition: Contract Source: Cornell University Law School U.S. Code Collection http://www4.law.cornell.edu/uscode/html/uscode31/usc_sec_31_00006303----000-.html An executive agency shall use a procurement contract as the legal instrument reflecting a relationship between the United States Government and a State, a local government, or other recipient when— (1) the principal purpose of the instrument is to acquire (by purchase, lease, or barter) property or services for the direct benefit or use of the United States Government; or (2) the agency decides in a specific instance that the use of a procurement contract is appropriate. Payor derives benefit New Mexico State University

  19. Definition: Grant Source: Cornell University Law School U.S. Code Collection http://www4.law.cornell.edu/uscode/html/uscode31/usc_sec_31_00006303----000-.html An executive agency shall use a grant agreement as the legal instrument reflecting a relationship between the United States Government and a State, a local government, or other recipient when— (1) the principal purpose of the relationship is to transfer a thing of value to the State or local government or other recipient to carry out a public purpose of support or stimulation authorized by a law of the United States instead of acquiring (by purchase, lease, or barter) property or services for the direct benefit or use of the United States Government; and (2) substantial involvement is not expected between the executive agency and the State, local government, or other recipient when carrying out the activity contemplated in the agreement. New Mexico State University

  20. Definition: Cooperative Agreement Source: Cornell University Law School U.S. Code Collection http://www4.law.cornell.edu/uscode/html/uscode31/usc_sec_31_00006303----000-.html An executive agency shall use a cooperative agreement as the legal instrument reflecting a relationship between the United States Government and a State, a local government, or other recipient when— (1) the principal purpose of the relationship is to transfer a thing of value to the State, local government, or other recipient to carry out a public purpose of support or stimulation authorized by a law of the United States instead of acquiring (by purchase, lease, or barter) property or services for the direct benefit or use of the United States Government; and (2) substantial involvement is expected between the executive agency and the State, local government, or other recipient when carrying out the activity contemplated in the agreement. New Mexico State University

  21. Definition: Gifts • Defined – funds received for which no specific goods or services will directly benefit the sponsor • Gifts can be made directly to the NMSU or to the University Advancement Office • Types of Gifts • Unrestricted – can be used for any purpose • Restricted – once given to a certain area will be classified as such New Mexico State University

  22. Award Types Cost Reimbursable – expenses are incurred and then invoiced for allowable costs, established budget Fixed - agency may provide some or all funding upfront prior to incurring expense, agreed upon price based on deliverable regardless of costs incurred Fixed/Cost Reimbursble New Mexico State University

  23. Research Team: New Mexico State University

  24. Team Focus: • The Research • Compliance – expenditure monitoring • Timely & Accurate Invoicing & Financial Reporting • Collection of Funds • Effort Certification • Timely Closeout • Auditors and Audit Findings New Mexico State University

  25. OMB Circular A-21: • OMB A- 21 - Provides principles for determining the costs related to “Sponsored Agreements” performed by colleges and universities under grants and contracts with the Federal Government. New Mexico State University

  26. OMB Circular A-21 – Cost Accounting Standards • CAS - states educational institutions expenses should be: • Consistent in estimating a proposal • Consistent in accumulating and applying cost acct’g practices which will facilitate the preparation of reliable cost estimates • Consistent in reporting costs New Mexico State University

  27. OMB Circular A-21 • NMSU’s CAS Template • Effort Reports • Disclosure Statement - DS2 • Required by Public Law 100-679 discloses NMSU’s cost accounting practices and details out indirect charges include in the facilities and administrative rate • Faculty Member Salary Rates • Major Projects New Mexico State University

  28. OMB Circular A-21 Facilities and Administrative (F&A) Rate F&A Rate = Total F&A Costs Modified Total Direct Costs New Mexico State University

  29. Facilities and Administrative Rate (F&A) • Is a rate based on those costs that are incurred for common or joint objectives and cannot be readily identified to a sponsored program or activity • A rate is calculated annually representing a % of indirect costs charged to sponsored programs New Mexico State University

  30. Facilities and Administrative Rate (F&A) • 2008 - NMSU began negotiating every two years • Office of Naval Research (ONR), our cognizant audit agency, approves • Billable Rate is the F&A rate approved in the award and equals the rate for the life of the award (LIFER RATE) New Mexico State University

  31. Facilities and Administrative Rate (F&A) • Effective Rate – Award Rate = Waived F&A • Banner tracks and reports waived F&A as: • Voluntary (defined in proposal) or • Involuntary (agency imposed) New Mexico State University

  32. Facilities and Administrative Rate (F&A) • The rate is applied to charges based on the award budget • The most common method to apply the rate is the Modified Total Direct Cost (MTDC) basis MTDC = Total Cost – Financial Aid – Subcontract > $25,000 – Equipment – F&A New Mexico State University

  33. OMB Circular A-110 Standards for obtaining consistency and uniformity among Federal agencies in the administration of grants to and agreements with institutions of higher education, hospitals, and other non-profit organizations. New Mexico State University

  34. OMB Circular A-110 • Subpart A – General • Subpart B – Pre-Award Requirements • Subpart C – Post-Award Requirements • Financial and Program Management • Property Standards • Procurement Standards • Reports and Records • Termination and Enforcement Subpart D – After-The-Award Requirements New Mexico State University

  35. OMB Circular A-110 • Business Procedures Manual http://www.nmsu.edu/%7eboffice/bpm/ New Mexico State University

  36. OMB Circular A-133 Purpose: it sets forth standards for obtaining consistency and uniformity among Federal agencies for the audits of States, local government, and non-profit organizations expending Federal awards. New Mexico State University

  37. OMB Circular A-133 Part A – General Part B – Audits Part C – Auditees Part D – Federal Agencies and Pass-Through Entities Part E - Auditors New Mexico State University

  38. Subrecipient Monitoring (A-133) • Require detailed monitoring procedures • Include the • PI • Departmental Research Administrators • Office of Grants & Contracts • Sponsored Projects Accounting • Accounting & Financial Reporting New Mexico State University

  39. Participant Support Costs (Agency Specific) • Stipends, allowances, registration fees for trainees require detailed monitoring • Allowable charges • F&A (NSF does not allow) • Trainee Lists • Documented Trainee Requirements New Mexico State University

  40. Federal Contracts Federal Acquisition Regulation (FAR) Defense Acquisition Regulations System (DARS) develops & maintains acquisition rules & guidance Defense Federal Acquisition Regulaton Supplement (DFARS) – apply to purchases and contracts by DoD contracting activites made in support of foreign military sales or North Atlantic Treaty Organizations cooperative projects without regard to the nature or sources of funds obligated New Mexico State University

  41. Award’s Progression New Mexico State University

  42. Award’s Progression: • System Administration – award set-up • Fiscal Monitors – expenditure monitoring, invoicing, financial reports, (cost sharing, program income, award terms and conditions) • Accounts Receivable/Special Projects – collection of funds, terming, audit requests, effort report certification New Mexico State University

  43. 1st - System Administration • Establish new awards in Banner Finance • Establish the initial documents for the electronic file in Xtender • Record modifications to existing awards • Extensions and revisions to existing awards • Record award budgets and revisions • Encumber & track subrecipient awards New Mexico State University

  44. 1st - System Administration • Set-up accuracy is important • Award Set-up has a 2-day turnaround goal • Common Reasons for hold up: • Incomplete award information • Missing documents New Mexico State University

  45. 1st - System Administration • Options Setting-up Awards on Waiver – BPM Chapter 3 Sponsored Projects Accounting – Section 3.15.15 • Conditons: • Prior program is being renewed • New program with a well-known sponsor • Terms & conditions are acceptable • Cost share/matching are acceptable • Substantial upfront costs are not required New Mexico State University

  46. 2nd - Fiscal Monitors Manage award expenditures by monitoring the implementation of fiscal restrictions and requirements imposed by sponsors on grants and contracts in accordance with Federal guidelines (OMB A-21, OMB A-110), agency guidelines, and the Business Procedures Manual. New Mexico State University

  47. 2nd - Fiscal Monitors • Invoice the Agency • Bill Allowable/Posted Expenditures by: • Verifying expenditures are within project period • Budget categories are not exceeded • Expense is within scope of project • Reviewing for CAS compliance • Validating index, fund # and account code • Verifying expense is allowable per University/Agency • Monitoring for appropriate approvals New Mexico State University

  48. 2nd - Fiscal Monitors • Transactions requiring agency approval per A-21 Section J prior to expenditure: • Capital Equipment (in proposal-approved) • Foreign Travel • Material Expenses incurred near project end date New Mexico State University

  49. 2nd - Fiscal Monitors • Financial documents reviewed daily: • Budget Entries • Direct Pay Requests • Journal Vouchers • Labor Redistribution Forms (LRF) • Reimbursement Vouchers • P-Card Transactions • Purchase Requisitions New Mexico State University

  50. 3rd - Accounts Receivable • Payments are submitted to SPA • Deposits are recorded in Banner • Payments are posted on Grant by fund • Letter of Credit draws are prepared and authorized New Mexico State University

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