GUIDANCE MANUAL AND IMPLEMENTATION Melanie Burdett J M Consulting Ltd

Principles n light-touch n build on existing Guidance n practical n robust n fair and reasonable n materiality n can be developed over time n holistic n consistency

Good & acceptable basis for start n Calculating average FTEs ** n Estimating investigator time ** n Recording FTEs by project on system n Allocating estates ** (on FTE basis) n Calculating indirect cost rates ** ** these need to be done already

Best practice (but over-ambitious for start) E.g. n Monthly FTE counts. n Estates allocation by building/room. n Timesheet evidence for PI time. n Project records for institution/own research. n All training done and sustainability processes in place by Jan 05.

Areas of new/developed guidance n Estimating time and costs of investigators. n Monitoring and reporting on project progress. n Costing of estates. n Other big estates-related costs. n Indirect cost rates. n Quality assurance of methods. n [Sustainability]. Timetable. Support available.

Estimating academic time by project n Project manager/grant applicant will estimate hours for type of project – x hrs per week. n Actual time will vary from this on each project, but overall for HEI and RC this should balance out. n Estimated hours * standard cost per hour (based on standard working week) = acad cost ‘budget’. n RCs will pay on budget (unless major variations occur). Various rules about externally funded fellows; clinicians; over-committed staff; etc. PIs will need training and support.

In project monitoring processes n PI to monitor progress and sign at end that time spent was not significantly different, or give reasons. Will need to keep records of meetings etc, but not timesheets. n Institution certifies that project is live (as now). n HEI to verify total by research councils thro TRAC system (needs budgeted time to be recorded).

Better accounting for estates – direct allocation to projects n Estates is biggest cost after staff. n Most sponsors likely to pay space as direct cost. n Institutions need to manage space, but most have a lot of work to do on this. n From 2005 must allocate space costs to project with a simple approach if good space data not yet available (e.g. two £/FTE rates – desk, and lab). n From 2007 need proper charging £ per sq m – differential types of space. n Guidance for multi-disciplinary, collaborative, off- campus, NHS, visiting fellows etc.

Better accounting for other direct costs n RAs, non-staff direct costs recorded as now. [Virement allowed.] n Other large costs – animals, glasshouses, specific Research IT etc all to be charged directly as well – no later than August 2007 n IT infrastructure can be direct, or as part of estates rates n Same requirements to show accounting record of charge

Indirect cost rates  Problem area with sponsors.  Residual indirect cost will be smaller and is mainly central services; acad support time; COCE.  Current % of staff cost method has flaws (not good driver and varies unhelpfully with salary), but is familiar and accepted by some research sponsors. We prefer to move to using £ per academic FTE. Institutions can use either method, & weightings. Those without robust methods will receive a lower I/c rate from sponsors. Two benchmark groups.

Developments to TRAC time allocation  Tighter TRAC process – three yearly (not three- five).  PGR student supervision to be excluded (through proxies if embedded).

Data quality and verification n HEFCE QA process will help institutions to develop their methods. n Includes benchmarking. Are PIs using reasonable methods for estimating time? Are good cost drivers being used? Do indirect rates on projects reflect real project costs? Is academic time sample for TRAC adequate? Is management doing reasonableness checks? Is a senior committee involved? Internal audit?