Effort Certification in the Kuali Financial System

1. Effort Certification in the Kuali Financial System Office of Research Administration Indiana University 509 E. 3rd Street Bloomington, IN 47401-3654 January 2014

2. The Highlights: Why and How of Effort Certification Effort Management and Certification KFS Highlights Project Director and Fiscal Officer Routing Federal Effort Reports Why and How of Effort Certification Cost Share Subaccounts NIH Salary Cap Frequently Asked Questions Effort Certification in KFS

3. Office of Management and Budget (OMB) Circular A-21 (Section J.10) Cost principles for educational institutions Verification that the salaries charged are consistent with effort expended OMB Circular A-21 has been codified into the Code of Federal Regulations - 2 CFR Part 220 IU Policy – Effort Certification Documents Employees with regular pay Effort certification documents are issued to certify effort Why we Certify Effort

4. “After the Fact” effort certification Payroll data is gathered from the Kuali Financial System (KFS) labor ledger on a periodic basis to determine 100% of each employee’s regular compensation, (i.e. Institutional Base Salary) The A21 Labor Ledger reflects the specific buckets to which labor was allocated. These entries will not reflect the General Ledger entries if salary has been reallocated. How do we certify effort?

5. The Labor Ledger Effort View

6. The Labor Ledger General Ledger View

7. Sometimes the GL and A21 Labor Ledger Match… A21 Labor Ledger General Ledger

8. Sometimes they don’t… A21 Labor Ledger General Ledger

9. Labor Ledger data is complied and distributed through the Effort Certification Documents in the KFS Effort reports are generated for only employees with effort on federal or federal pass through accounts 100% of Institutional Base Salary is reported Salary transfer generation is stopped and all enroute salary transfers are auto-disapproved prior to effort report distribution Upon final approval, an auto-generated salary transfer is completed. Effort Report Generation

10. FALL Periods ReportIssue Date Approval Deadline Monthly 12-Pay (M01 – 7/1 to 12/31) February 17th April 18th Academic 10-Pay (A01 – 8/1 to 12/31) February 17th April 18th Biweekly (B01– 7/1 to 12/31) February 17th April 18th SPRING Periods ReportIssue Date Approval Deadline Monthly 12-Pay (M02 – 1/1 to 6/30) August 15th October 14th Academic 10-Pay (A02 – 1/1 to 5/31) August 15th October 14th Biweekly (B02 – 1/1 to 6/30) August 15th October 14th SUMMER Period ReportIssue Date Approval Deadline Academic Summer (A03 – 5/1 to 8/31) October 15th December 14th The Effort Periods

11. Effort Management should be conducted throughout the effort period Monthly Account Reconciliation IU Policy - FIN-ACC-I-1 - Role of Fiscal Officer, Account Manager and Account Supervisor Communication Effort Certification Documents are intended to certify payroll on all Federal and Fed Pass-Through sponsored projects Document changes made when errors in effort allocations are discovered Effort Management vs. Effort Certification

12. Financial Reports All costs must be booked to accounts before final report is sent Final Financial Reports will be sent even if effort reports are not approved Account Close Effort should not be reallocated after account expiration Importance of Ongoing Effort Management

13. What should your justifications include? What do you know now that you didn’t know when the original effort was applied? How was the incorrect effort distribution determined? What is being done to prevent similar occurrences in the future? Justifying Changes on Effort Certification Documents

14. The Policy All Reports Certified within 60 Days past issuance The Consequence All Effort Removed from Federal and Federal Pass Through Projects Effort Certification Deadline

15. Effort Recertification Office of Research Administration Cost Exception Committee Only on an Exception Basis Move effort to a cost reimbursable project Recertifications requested after account expiration Effort Certification Policies

16. The KFS Effort Certification Documents

17. Employee 1 Employee 2 Employee 3 PI 1- Federal Project 30% 100% 0% PI 2 - Non-Federal Project 30% 0% 50% PI 3 - Non-Federal Project 40% 0% 50% 100% 100% 100% Employee Effort Report Created? Yes Yes No PI included in Routing? PI 1 PI 1 None Fiscal Officer / Delegates? Yes Yes None Effort Certification Documents and Routing

18. Action List example

19. KFS Effort Document – Project Director View

20. KFS Effort Document – Fiscal Officer View

21. Document Routing

22. Subaccounts on Effort Reports • Cost share sub-accounts are entered on a separate line to allow users to identify the departmental source accounts. • Expense subaccounts are aggregated to report at the main account. • Effort is managed at the account level for effort reporting.

23. Cost Share Subaccounts on Effort Reports

24. NIH Salary Cap The NIH limits the amount of salary which may be reimbursed to universities for salaries charged to DHHS projects. In recent years, the salary limitation has been tied to the federal government’s Executive Level II salary rate.

25. Frequently Asked Questions • How do I modify small dollar amounts without changing the effort percentage? • Account PI vs. Award PI • What if a Fiscal Officer or PI leave the University? • Ad Hoc Routing

26. How do I modify small dollar amounts without changing the effort percentage? When the Integer Percentage does not match the Derived Percentage, effort modifications may require an additional adjustment to salary dollars.

27. How do I modify small dollar amounts without changing the effort percentage? • Decrease Line 1 under Federal and Federal Pass Through Accounts to match the 2% reduction in effort. ($119.34) • Click “Save” • Increase Line 1 under Other Sponsored and Non-Sponsored Accounts to match the 2% increase in effort. ($95.91) • Click “Save”

28. How do I modify small dollar amounts without changing the effort percentage?

29. The Account PI and Effort Document Routing

30. The Account PI and Effort Document Routing

31. Approvers No Longer at IU • Update accounts for new responsibilities • Request an update of both Award and Account PI • If an effort report is in routing to a terminated employee, contact Tim Burris at thburris@iu.edu

32. Ad Hoc Routing: Rules and Constraints • Effort documents may be routed for: • Approval • Acknowledgement • FYI • No changes are allowed • With ad hoc routing, the document routing progression stops

33. Some Points to Remember • A21 Effort Reports are only generated if effort is on federal or federal pass through accounts • Documents may only be modified from the Action List • Manage effort activity regularly (at least monthly) • Effort Recertifications are Exception Only • Cost Share subaccounts are reported on a separate line on effort reports • Expense subaccounts roll up to the main account • Salary transfers are automatically generated when documents are final approved.

34. Final Questions?

35. Resource Links • IU Policy link: • http://policies.iu.edu/policies/categories/research/Sponsored-Programs-Administration/Effort_Certification_under_OMB_%20A21.shtml • Effort Certification on the ORA Web http://researchadmin.iu.edu/GrantContract/gc-gfo/gfo_effort.html • A21 Effort Guidance for Document Routing and Approval http://researchadmin.iu.edu/GrantContract/docs/KFS_Effort_Certification_Guidance_for_Document_Routing_and_Approval.pdf • Role of Fiscal Officer, Account Manager and Account Supervisor http://policies.iu.edu/policies/categories/financial/accounting-administration/FIN-ACC-I-1-role-of-fiscal-officer-account-manager-and-account-supervisor.shtml

36. Questions & Additional Training Tim Burris Financial Compliance Manager Office of Research Administration Indiana University 509 E. 3rd Street Bloomington, IN 47401-3654 Telephone (812) 855-0185 E-mail thburris@iu.edu

37. Questions & Additional Training Rayna Amerine Financial Compliance Associate Office of Research Administration 509 E. Third St. Bloomington, IN 47401 Phone: (812) 855-1516 Email: ramerine@iu.edu