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I have the grant, now what!?

Presented by John Hulvey, DirectorSponsored Programs Admin & Accounting

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Introduction

This presentation covers:– Understanding the basics

• Common Misconceptions– What’s the PI’s role?– What’s Sponsored Programs

Accounting’s Role? – Expenditure Compliance– Reading PS Financial Reports– “Gotcha’s”! & Summary

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Vocabulary

• Department ID = Org. Code = Grant Number

• Account # = Expenditure Code• PI = Principal Investigator• Facilities and Administration (F&A)

(indirect costs or “overhead)• Finance System = General Ledger

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Common Misconceptions

• All sponsored program awards are “grants.”– Also Contracts and Cooperative Agreements

• That funds are totally controlled by the PI.– JMU Policy 2201 states “All funds received for

sponsored programs are under the fiscal control of the assistant vice president for finance.”

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Common Misconceptions

• That we can change the scope of work or use of funds without the sponsor’s permission.– Must be good stewards of the funds; they

were given for a purpose.• There is a ‘pool of money’ with an

award. – Most cash is received on an expenditure

reimbursement basis.– Sponsor may refuse to reimbursement

unallowable expenses

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Common Misconceptions

• Standard JMU rules don’t apply to these funds.– Very wrong; in fact, control over

expenditures may be more strict.– Everyone wants to add a regulation!

• Specific grant instructions; JMU policy (2201 states awards must follow JMU procedures); state regulations; federal regulations; federal law.

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Common Misconceptions:The rules don’t apply (continued)

• Grants & Coop Agreements are governed by OMB Circular A-21; Contracts by FAR clauses (Federal Acquisition Regulation).

• Costing standards and allowable costs

• All awards governed by A-110 • Administrative requirements

• Federal Agencies “codify” FAR and A-110 independently

• Code of Federal Regulations (CFR)• Regulations apply to federal agency, applied

to award recipients through CFR

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What’s the PI’s Role?

• Person of many hats– Researcher, Manager, Accountant.

• Has DIRECT responsibility for award– Must complete responsibilities of award– Must work within approved budget– Must ensure “Matching” is met and “Effort”

is applied– Maintain Adequate Documentation– May delegate workload

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What’s Sponsored Programs Accounting’s Role?

• Establish Financial Framework–Department ID(s); Budgets

• Maintain ‘auditable’ file• Post-award compliance officers

for the University• Billing/Collection from

Sponsors• Prepare Financial Reports• Timely close-out of grant

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Purchasing Rules

• Same for Grants as other University funds– (Unless stated in Award)

• May actually be more restrictive– Must relate to grant work & budget.

– Must comply with A-21 or FAR regulations

– No Membership fees, subscriptions

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Purchasing Rules

• EVa must be used• SP Cards must be used &

reconciled• Forms:

– Accounting Voucher– Travel Authorization – Travel Reimbursement Voucher– Agency Transfer Voucher (ATV)– Personnel Action Request (PAR)

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Procurement Rules

• Required for all purchases of goods and services $5000 or more.

• Must use Va State Contracts

• Some procurements can be built into the Sponsored Program as a Sub-agreement

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Expenditures (Travel and Business Meals)

• This is one area where otherwise rational people loose their minds with Sponsored awards!!

• Simply stated: VA State (JMU) rules apply (Unless specifically addressed in the award)

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Expenditures (Travel and Business Meals)

• Common Unallowable Expenses:– A business meal with no non-JMU employee

attending (this is a “meeting”, not a “business meal”)

– ‘Pizza parties’ for student employees– Staying at over-priced hotels or eating at

over-priced restaurants. – Charging a rental vehicle when cab fare to

and from the airport was reasonable.• This is particularly obvious when the family

accompanies the traveler to the conference.

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Additional Travel Regulations

• Foreign flights (Coach Class)– Must be on US flag bearer when using

Federal dollars! • Cost is not a factor; however, there are some

exceptions related to service destinations or arrival/departure times

• Use a JMU authorized Travel Agency and indicate “Fly America Act” must be followed

– JMU approval still needed for Travel Authorizations• Not automatic with the sponsored program award

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Personnel Considerations

• Employee vs. Contractor– Has bearing on taxes withheld– What ‘control’ exists over person?

• See 20 questions on Payroll Website• If in doubt, contact Payroll

• Must follow immigration rules to hire non-US Citizen on Award– Contact office of international

programs with questions

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F&A (Facilities and Administration)

• Part of the award budget– Seldom reduces direct expense budget

• 50% returned to Institution– 30% Department; 10% Dean; 10% Provost– Must be spent in support of Grants

• Withheld from award budget loaded to Finance System.– Budget then increased with each monthly

F&A charge.

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Matching (Cost Sharing)

• Mandatory vs. Voluntary– Voluntary Match is discouraged by

University policy and restricted by some funding agencies

• What is allowed?– Must have a basis for value– Space/Equipment must be 100%

designated to the project.– Must be documented / reported at the

conclusion of the project.

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Effort

• Percentage of time applied to a project related to all PAID JMU activities. – Must ALWAYS equal 100%– Does not change based on number of

hours worked– Cannot ‘over commit’ effort– JMU certifies effort each semester

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Why should the PI keep records?

• PI’s responsibility! (Stewardship)– Like reconciling a checkbook– Tie expenditures to award budget

• Ensure accuracy of keyed data• Track Timing differences• Track ATV (automatic) charges

– Postage, telephone, Copy Center, JMU car rental

• Document ‘matching’ and ‘effort’• Up to 5 year record retention

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Budget Revisions

• May require sponsor’s written approval

• Processed through Office of Sponsored Programs

• PI must justify how a budget line can be reduced and how the new budget would improve the project

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Close out

• Most projects have defined ending date where work must be completed and expenditures incurred– Processing of incurred expenditures generally may

continue after project end-date, but NO NEW expenses.

• PI records are a MUST at this time and are difficult to construct if not already prepared.

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Close out (No cost extension?)

• PI should request a ‘no-cost extension’ through Office of Sponsored Programs if needed – At least 30 days before the project end date– Not just for convenience or to spend

remaining funds

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GOTCHA’s

• Timing of transactions to General Ledger

• Grant Period ending before project is done

• Forgetting that FICA is added to Lump Sum salary amount on PAR form

• Not following the awarded budget and budget justification

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Summary

• Generally, JMU rules apply• Buck stops with PI (and

department)• Sponsored Programs Accounting

provides assistance and reviews for compliance

• When in doubt, refer to the award

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Where to Get More Information

• Sponsored Program Accounting - MSC 5713

JMAC Building 6, Suite 30 • John Hulvey

– 83725 hulveyjd@jmu.edu• Brenda Wilburn Seifried

– 82314 wilburbc@jmu.edu• Donna Crumpton

– 88099 crumptdl@jmu.edu• Kyra Shiflet

– 87108 shiflekl@jmu.edu