1. Sponsored Project Compliance
Roles, Responsibilities and Allowability of Costs
University of North Texas Health Science Center
Office of Sponsored Programs

2. We Are All Responsible
Claimants and recipients of government money share responsibility for honest spending and accurate accounting

3. Enforcement Climate
No organization wants to become the “poster child” for wrongdoing
Northwestern ($5.5M), Hopkins ($2.6M) & Harvard ($2.4M) – effort
Penn – informed consent & conflict of interest
Mayo Clinic ($6.5M) & Yale ($7.6M) – cost transfers, effort, cost sharing
Rush ($1M) – clinical trial billing
UAB ($3.4M) – overstated research effort
Florida ($19.9M) – effort, cost sharing
These cases, and many others, have brought considerable unwanted attention to research institutions

4. Enforcement Climate
Increasing coordination among federal and state law enforcement officials
Greater degree of Congressional oversight
More litigation
Whistleblower actions
False statement criminal investigations, charges
Class actions
More resources, tools, investigative techniques, data mining
Heightened financial pressure
Agency priorities

5. Enforcement Climate
Federal sponsors actively engaged in auditing grants
Audits have specifically focused on labor charges
Labor charge audits involved interviews to determine whether:
Labor charges documented were actually incurred
The type of work performed was consistent with award scope of work

6. PI’s Are Under Investigation
“. . . our recordkeeping was far from perfect, and to defend against a charge that all $2.4M was spent correctly would have been very difficult.”

7. Universities Are Under Investigation
“The university overcharged HHS [$19.88M] on hundreds of grants for the costs of employee salaries without possessing documentation ‘to support the level of effort’ claimed for their work.”

8. Shared Responsibility for Compliance
You are part of an institution
Your role is part of a whole
You share responsibility

9. Roles and Responsibilities (R&R)
Principal Investigator &
Departmental Support
Develop and prepare grant applications and budgets
Signs and submits the External Proposal Transmittal Form (EPTF) prior to proposal submission
Review contracts for scientific aspects
Complete and maintain documentation of all technical aspects of awards
Administers award in accordance federal guidelines.
Review sponsor guidelines for terms of award and ensures adherence to sponsor guidelines and institutions policies.
Office of Sponsored Programs
Review and submit grant applications
Ensure EPTF has been completed and is on file prior to proposal submission
Draft, negotiate, sign contracts
Award set up of sponsored project and notifies PI/Departmental Support of new projID for sponsored project.
Review sponsor guidelines for terms of award and ensures adherence to sponsor guidelines and institutions policies.
Provides guidance to PI/Departmental Support regarding allowability of costs.

10. Roles and Responsibilities (R&R)
Principal Investigator &
Departmental Support
Initiate, review and approve salary distributions, purchase requisitions, check requests, expense reimbursements, and purchasing card transactions to appropriate sponsored projects.
Notify OSP of changes in effort to sponsored projects
Initiate request for cost transfers
Initiate rebudget requests
Timely submission of cost share supporting documentation, where applicable
Review and approve subcontractor invoices
Reviews and certifies effort reports
Office of Sponsored Programs
Review and approve expense transactions on sponsored projects.
Work with PI to determine if changes in effort need sponsor approval
Review and process cost transfer request
Review and process rebudget requests
Track and account for cost sharing
Subrecipient monitoring
Manages the distribution and certification of effort reports

11. Roles and Responsibilities (R&R)
Principal Investigator &
Departmental Support
Participate in audits as required/requested
For projID’s in the final year, complete necessary documents for close out
Requests for No Cost Extensions / Notification of Continuation Funding to OSP
Preparation of carryover request
(if approval required)
Provide Carryover Request Letter
Provide Carryover Budget
Complete technical reporting requirements
Resolution of overdraft or unused funds on sponsored projects
Office of Sponsored Programs
Audit management (internal and external)
notification of approaching end dates
Preparation of ALL financial reports or invoices
For projID’s in the final year, complete necessary documents for close out
Submission of No Cost Extension Requests to Sponsor
Submission of Carryover Request to Sponsor
Maintains active registrations with federal websites and databases

12. Roles and Responsibilities (R&R)
Principal Investigators and Co-Investigators: Eligibility, Roles and Responsibilities –
Located on OSP website –

13. Helping you manage all the R&R
OSP, PI and Dept will begin having mandatory projID set up meetings when new projects are established
Review award terms and conditions
Review key personnel effort for new and existing awards to determine if changes in effort are needed
Review OSP Sponsored Project handbook to ensure PI and department understand all compliance related matters to manage the project

14. What makes an expense Allowable
Monitoring awards ensures expenditures are allowable, allocable, reasonable and necessary to a specific sponsored project in accordance with award budget, sponsor guidelines, and HSC policy.
Allowable: A cost is allowable to a project if the costs are:
Reasonable;
Allocable to the specific project;
Treated consistently in like circumstances; and
Conform to any limitations of the cost principles or the sponsored agreement.
Reasonable: Costs must reflect what a “prudent person” would pay.
Allocable: A cost is allocable to a project if goods or services involved are chargeable or assignable in accordance with the relative benefits received by the projects. In order to be allocable a cost must be treated consistently in like circumstances.
Necessary: Was the cost necessary in order to complete the objectives of the project

15. What is Effort Reporting?
Effort Reporting is the method of certifying the effort required as a condition of the award has actually been completed
Effort is defined as the amount of time spent on a sponsored research project in which salary is directly charged or contributed (cost-share) during a specified period of time

16. What is Effort Reporting? - Continued
40 hour/week IS NOT the definition of 100% effort from which percentage of research effort is certified
100% effort is an employee’s total time actually spent completing all aspects of their position
Effort certification should accurately reflect the work performed.

17. What is Cost-Sharing?
Cost-sharing is the portion of the total sponsored project’s costs that are paid by the institution, rather than by the sponsor.
There are 2 kinds of cost-sharing:
Mandatory Committed is required by the sponsor and documented in the proposal.
NIH, CDC, DOJ, HHS, CPRIT
Voluntary Committed is not required by the sponsor but is included in the proposal. In the event the proposal is funded, your voluntary committed becomes mandatory.

18. Why is Effort Reporting Necessary?
Compliance
Comply with the State of Texas requirements – Uniform Grant Management Standards (UGMS)
Comply with federal regulations (OMB Uniform Guidance, 2 CFR )
University Policy
Effort Certification Report System (ECRS) is the tool we use to ensure our compliance

19. What is the ECRS? Part One Part Two
Online system within EIS used to capture salary expenditures, effort, cost sharing and salary cap data.
Management tool used to verify the amount of salary paid on a project, cost share and effort reported.
Part Two
Effort Reporting Certification

20. The Effort Certification Process
Certification process is complete
PI logs in to review the report for accuracy
EPar processed to charge Actual Salary Cost to projects
PI reviews Monthly Management Reports for accuracy
End of Semester rolls around
OGCM sends out notification
PI “agrees”
PI “disagrees” sends ECM comments and adjustments are made
PI certifies online

21. Part 1 - Why use Monthly Management Reports?
EIS report tool used to track payroll activity by project or by employee for amounts paid by sponsors (direct charge) and institution (cost share)
Easy way to identify people paid on wrong project
Easy way to identify changes in effort on projects
Track burn rate of effort on project and for cost sharing
Easy way to see effort committed to multiple sources

22. Part 2 – When do we have to certify?
Three times per year
Fall
Spring
Summer
Effort reports should be certified within a reasonable amount of time
Reminder s will be sent with escalation if certifications are not completed timely

23. What happens if we don’t complete the certification?
Failure to complete the effort report leaves the university in jeopardy of disallowance of the salary costs on Sponsored Projects
Erroneously certifying effort can be viewed as fraud and subject to penalties

24. Who has to certify Effort?
Effort report must be signed by a person having direct knowledge of the work that was performed
Principal Investigator
Certification by a department administrator or other staff member is NOT permitted.

25. What does effort reflect?
Effort must accurately reflect the work performed
Employees’ total compensated activities
Both federally assisted and all other activities
Supports the distribution of the employee’s salary or wages among the employee’s activities (federal and non-federal, sponsored and non-sponsored)
NOT budget driven, but should be consistent with the distribution in the budget

26. Effort Reporting Must Be Current
“Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed.”
PIs are required to seek prior approval from NIH before they reduce the effort of key personnel named in the Notice of Grant Award under the following circumstances:
Key personnel “withdraw from the project entirely”
Key Personnel are “absent from the project during any continuous period of 3 months or more”
Key Personnel “reduce time devoted to the project by 25% or more.”

27. Changes to Effort
The PI is required to inform OSP of all changes to effort on active projID’s
OSP will work with the PI to determine if the change requires sponsor approval and if changes to payroll are required

28. How Does a PI Know What to Certify?
PIs are responsible for knowing what effort has been spent on their grants
PIs should not certify unless they have reviewed effort and can support it
Lab notebooks, time sheets, regular lab staff meetings, raw data, etc.
OSP will carefully scrutinize, follow-up and audit certifications

29. Per NIH, A Lab Notebook Is…
Complete record of procedures, reagents, data, and thoughts to pass on to other researchers
Explanation of why experiments were initiated, how they were performed, and the results
Legal document to prove patents and defend your data against accusations of fraud
Scientific legacy in the lab

30. A Lab Notebook Is Not… A journal A record of communications
A place to compile lab protocols/manuals
Yours to take home

31. Different Types of Lab Notebooks
Bound/Stitched Notebook
Loose Leaf/ Three Ring Binder Notebook
Electronic Notebook

32. What Goes in the Lab Notebook
Notebook name
Inside cover or cover page
- Your name and year
- General project name and ProjID #
- Lab mailing address
Table of Contents
Body of notebook
- Experimental entries

33. Experimental Entries Date Title
Hypothesis or Goal: Brief statement of purpose
Background
How: Protocols, calculations, reagents, equipment
Observations:
- All that happens (planned or unplanned)
- Raw experimental data
- Taped in information or reference to data location
Data analysis
- Processing or raw data, graphs, interpretations
Ideas for future experiments

34. The Details of “How”
Reagents: source, product number, lot number, expiration date, how and where stored
Solutions and how they were made
Cells used: type, source, passage number, growth medium
Instruments: type, name, location, serial number
Number and volume of washes
Centrifuge speeds and duration of spins
Heating rates and levels of agitation
Time between and during steps
Gel percentages
Type of water used

35. Ethics All data goes in to the notebook
- Even “bad” data points or “outliers”
- Failed experiments or contradictory experiments
No pages come out of the notebook
- Do not take any pages out or remove any data
- Do not skip pages in your notebook
-Cross out any unused parts of a page
Correct mistakes, do not remove them
- Cross out mistakes with a single line
- Paste in corrections without covering anything
- Sign and date all corrections
Honesty is the best policy

36. Questions? Contact OGCM Kristi Lemmon Brenden Perfect
Associate Director OSP Compliance Manager
(817) (817)