OCTOBER 2011SUZETTE ASHBY

MANAGEMENT ACCOUNTING AND ANALYSIS

Faculty Effort Certification, the Basics

Introduction

AgendaIntroductionWhy are we here? What is Faculty Effort?What are the steps in the Process?What do I need to know to successfully

review FECs?What are the consequences?

Training Objectives

Understand the federal requirements and why we do effort reporting

Understand UW policyUnderstand relationships among effort, cost

sharing, salary transfersUnderstand key terms and definitionsBe able to properly review effort reports.

Sponsored Funding at UW is Huge!

Over $1 Billion in sponsored project funding

Equals almost 1/3 of UW operating budget

Supports over 7500 University employees

2600+ Faculty performing research each year

Sponsored Activity at UW

Non-fed-eral

Spon-sors, 30%

Federal Spon-

sors, 70%

UW Sponsored Activity FY2010$1,419,850,098

With Federal sponsored research support comes compliance requirements. One of these is Effort Reporting

What is Effort Reporting?

Effort reporting represents the periodic certification of faculty salaries charged to grants and contracts. Represents a reasonable reflection of effort devoted to

those agreements Each sponsored agreement must be certified

separately, i.e. cannot be lumped together This is also required for effort that is cost shared.

This is a Federal requirement per A-21.

OMB A-21The Code of Federal Regulations (CFR) Title 2, Volume I, Part 220

Charges fairly represent the work performed. Was the time faculty spent working on the grant reasonable,

accurate?

Verification that the compensation charged is appropriate to the activity performed. Was faculty’s time actually spent on the grant as opposed to

other work?

Verification that the actual effort performed equates to the effort committed. Did the faculty do the work they committed to in the

proposal?

Why is accurate, timely reporting important?

Effort reporting, cost sharing, salary transfers, late FECs have been, and continue to be, an audit focus. 2010 University of Delaware 2009 Arizona State 2008 Yale 2007 Georgia State 2006 University of Arizona 2005 Florida International University 2004 Johns Hopkins 2003 Northwestern

What is Faculty Effort?

Time faculty spend on instruction, research, patient care, administration, etc. which is compensated by the University of Washington

Compensation supporting the grant effort may be from Grant funds Non-grant funds (cost shared)

Cost Sharing

Cost sharing is effort that is committed in the proposal performed on the grant but not paid by the grant

Cost shared effort cannot be paid from federal funds and only from other non-federal sponsored project funds when approved by sponsors.

Types of Cost Sharing

MandatoryVoluntary CommittedSalary CapShift in Funding Source (long term and short

term)K Award Cost SharingMore Information:

http://f2.washington.edu/fm/maa/fm/maa/facultycostshare/detaileddefinition

The FEC

Faculty Effort Certification Reports (FECs) are forms faculty use to document

Salary effort paid on sponsored projects

Cost shared effort performed on sponsored projects

And all other effort (non-sponsored)

The purpose of the FEC is to certify that pay was a reasonable reflection of effort using a suitable means of verification.

Note: Effort for Non-Faculty

Regulations that apply to faculty also apply to other employees who work on sponsored projects.

Non-faculty employees such as professional staff, senior fellows, lab technicians, graduate students must also certify their effort

Certification for non-faculty is done on the Grant and Contract Certification Report (GCCR).

Quiz

True or False

Effort on each grant must be exactly what was committed in the proposal.

Faculty can use some time paid by the grant to work on related research.

Post-Award

15

Pre-Award

Appointmentof Faculty &

Staff

Preparingthe

Proposal

ProjectSet-up

ChargingExpenses

Reporting & Certifying

Effort

RecordsRetention

Fiscal Reporting

Process: the Seven Steps to Success

I just want to get to the FEC part!

Why talk about pre-award? What do I need to know to analyze the data on the FEC? Where does the data come from? How do I confirm the information is right? Wrong? Where do I go to have errors fixed?

Building a Solid Foundation

Step One: Appointment

Terms of employmentScope of workInstitutional base salaryAppropriate funding sources

Step Two: The Proposal

Effort commitments Once effort commitments are made to the sponsor,

they are required if the grant or contract is awarded.

If requested funding is reduced by sponsor the department should consider if effort needs to be

reduced and, if so, work with OSP to reduce effort commitment.

OR If the department chooses not to contact the sponsor to reduce effort, the faculty member is obligated for the effort committed in the proposal.

Step Three: Project Set Up

Roles and Responsibilities Department

Revises/prepares GC1 Addendum if needed for cost sharing and submits to OSP

Office of Sponsored Programs (OSP) Creates Electronic Funding Action (eFA) and forwards to GCA along

with a copy of the GC1 Addendum.

GCA Receives eFA and GC1 Addendum from OSP and sets up budget in

FIN and the eFECS Cost Share Module if there is cost sharing.

Department Checks EVERYTHING

Budget set up in MyFD and eFECS Cost Share Module if applicable.

Step Four: Charging Expenses

What should I put into OPUS? What are the effort commitments? Does the grant have a salary limitation? Does the faculty have Administrative or Endowed

Supplements? ADS or ENS? Does the faculty have clinical salary? Is there a shift in funding source?

Step Five: Reporting and Certifying Effort

How is the FEC used? To certify that the faculty have performed the work

they committed in the proposal Available for audit Documents a cost share source Forms part of the F&A calculation Final report to sponsor

Step Six: Fiscal Reporting

GCA closes the budget Cost share

Cost share must be met before the budget can close Cost share data included in final report to sponsor

At the end of the grant the department should ensure that documentation is available to verify that effort commitments as stated in the proposal have been met.

Step 7: Records Retention

Departments will keep FECS and supporting documentation one year after the end of the fiscal year for all FEC cycles prior the launch of eFECS, Phase III, Online Certification.

With the launch of eFECS, Phase III, Departments will not be required to keep paper files for future cycles.

eFECS will keep electronic copies for one year after the end of the sixth fiscal year with launch of Phase III. (3 biennium plus the current fiscal year. )

Quiz

Name 3 reasons why it is important to know something about the pre-award process.

What do you need to know to review an FEC?

Where can I find the new FECs? Get access?What was the sponsor promised?What is institutional base salary?What is considered a faculty work week?What should I be checking? What do I put into OPUS?How do I handle changes?Who can certify the FEC and what is

“suitable means of verification?

UPDATE LATER Getting Access

eFECs: Must be set up in ASTRA for Effort Reporting as User with FEC

Coordinator/View and Print Effort Report role. ASTRA set up instructions

https://f2.washington.edu/fm/efecs/access-and-roles Log in to eFECS

https://f2.washington.edu/fm/e fecs/

Cost Share Must be set up in ASTRA for eFECS Cost Share as User with Campus

Inquiry/View role. ASTRA set up instruction (in eFECS Training)

http://www.washington.edu/uwit/im/Finance/efecs/ Log in to eFECS Cost Share Module

http://www.washington.edu/uwit/im/Finance/efecs/

Unmet Cost Share Report

Unmet Cost Share Report Provides departments with real time status of cost

share for their budgets and allows them to print individual reports for PIs.

Request access using the Contact form on the FEC website http://f2.washington.edu/fm/maa/contact

Log in http://f2.washington.edu/fm/maa/home

Commitments

What was the sponsor promised and why is it important? Sponsor assumes what is committed in the proposal

will be accomplished. Commitments include both effort paid directly from the

grant and cost shared effort. Significant reduction in effort requires PRIOR sponsor

approval.

Institutional Base Salary (IBS)

IBS represents compensation paid by UW for an employee’s appointment. Includes

Time spent on research, instruction, administration, service or clinical activity.

Earn types REG, SUM, PLP, TFA, ADS, ENS. Salary from State, Grants and Contracts, Gifts and

Endowments, Other UW funds and Clinical Practice Plan (UWP and CUMG).

Quiz

What is the difference between Institutional Base Salary and full time rate?

Faculty Work Week

Faculty work week is the average number of hours a faculty member normally works – averaged over the FEC cycle.

Effort is NOT defined in hours, it IS defined in %

If a faculty member works on average 40 hours a week, 10% of his/her time is 4 hours. 50 hours a week, 10% of his/her time is 5 hours. 60 hours a week, 10% of his/her time is 6 hours.

Checking “Everything”

Check FIN/MyFD Is the budget type and class correct? Does the budget have the correct revenue code? Is the cost share flag set?

Check eFECS Cost Share Module (CSM) Is the cost share set up? Is the cost share set up for the right periods, faculty, percents? Is summer cost share required; has the workaround been put into the CSM? Does the budget have the correct begin and end dates?

Check HEPPS/OPUS Is the appointment information correct? Does the % reflect the committed effort? Has the % been adjusted for earn types without FTE? Is the salary paid up to, but not over cap?

35

Rabbit, P.

Cost share prorated

depending on

start/end date

What do I put into OPUS?

Simple Example: % in OPUS should reflect % committed in proposal

Administrative (ADS) or Endowed (ENS) Supplements ADS and ENS have no FTE attached to them in

HEPPS/OPUS % effort must be adjusted so that the percent on the FEC

reflects the effort committed in the proposal. % effort in OPUS will be greater than the committed effort. ADS/ENS calculator tool:

http://f2.washington.edu/fm/maa/fec/fectools Note: there are three tabs

Clinical Salary

Clinical Salary dollars are not displayed in HEPPS/OPUS

Example: Grant requires 10% effort

X = $150,000 (UW Salary) Y = $25,000 (Practice Plan) $175,000

10% * $175,000 = $17,500 $17,500/$150,000 = 11.67

Put 11.67 into OPUS FEC includes both X and Y so % = 10%

What to put in the Comment Box- or Not

38

. GOOD• Variations from normal reporting

• Short term shift in funding.

• Non-federal grant has approval to be used as a cost share source.

• Reason FEC is being recertified.

BAD• This was not my plan.

• The % effort is not consistent with what I understood it to be or as

listed in my support from the sponsor.

• Have initialed corrections on [the FEC] when it went through my hands.

• I do not understand the calculations.

• This grant ended. There should be no charges on it after summer quarter.

Quiz

Your new chair has an ADS component to her salary.

Departments should reconcile the percent FTE on the FEC to HEPPS/OPUS records.

True False

True False

True False

True False

ADS is not included in the institutional base salary used on the FEC.

The department should set up the OPUS record to reflect the percentage of effort committed in the proposalThe department should ensure that the percentage on the FEC matches the percentage in the award.

How do I handle changes?

System Changes Make changes to OPUS, eFECS Cost Share Module,

FIN

Manual Changes (Recertification Only) Make changes on the FEC

System Changes

System Changes Salary transfers (OSETs) are made in MyFD Changes to cost share pledges are made in eFECS

Cost Share Module Contact GCAHelp@u.washington.edu

Retro pay and overpayments made through Payroll

Before FEC is certified, wait overnight, Confirm changes appear as you expect.

Print a new, updated FEC from eFECS.

Delete Manual Changes

Manual Changes Use column D, “% Adjustment”

Actual cost share is different than the pledge Faculty chooses not to budget up to new cap Documenting K Award cost share Documenting short term shift in funding source

Using a non-federal grant, with sponsor approval, as a source for cost sharing.

Delete

Manual Changes - Recertification

For FECs created prior to Phase III: Use the department copy of the previously certified report

For FECs created after Phase III, online certification Print a paper copy of the certified FEC from eFECS

Write “Revised” at the top Make the required changes Adjust all totals and subtotals Attach documentation to support the revision Provide reason why effort previously was determined to be

correct and now is not. Faculty signs and DATES the form in ink.

Do not print a corrected copy from eFECS for recertification purposes.

Who should sign or certify the FEC?

The faculty member whose name is on the FEC should sign the form (Phase II) or certify (Phase III).

Phase II Process when Faculty is not on campus or unavailable to sign Mail, scan or FAX FEC to faculty for review and signature Faculty can

Review and sign the form and return by campus mail. Review and sign the form and email back to chair or dean

indicating that the effort information is correct on the form. Chair or Dean can provide signature in ink using email as

suitable means of verification.

Suitable Means of Verification

Suitable means of verification that the work was performed is required by federal regulations.

What is suitable means? Participation in or close supervision of work

performed Written confirmation from the faculty member that

the work was performed and effort displayed accurately on the FEC.

Cycle Dates

Calendar: 1/1/xx – 6/30/xx 7/1/xx – 12/31/xx

Academic 9/16/xx – 3/15/xx 3/16/xx – 9/15/xx

What happens if I am late?

Four Step Follow up Process Step One: 45 Days after Release Date

Email reminder– FEC is due in two weeks. To: FEC Coordinator and Administrator

Step Two: 60 days after Release Date Letter indicating FEC is overdue To: FEC Coordinator, Department Administrator; copy to Chair,

College/School Administrator, Faculty

Step Three: 60 days plus two weeks after Release Date Letter indicating FEC is overdue To Chair; copy to Dean, Faculty, School/College and

Department Administrator, FEC Coordinator

The Final Step

Step Four: 60 days plus four weeks Letter to Dean requesting all charges be removed from

grant Copy to Chair, Faculty School/College and Department

Administrator and FEC Coordinator.

Consequences, What’s the Risk?

Significant audit findings are possible if reports are late or inaccurate

Audit findings may result in Payback of funds to sponsor Withholding future awards Temporary withholding of payments Loss of expanded authorities Special monitoring by sponsor Requirements for corrective action Designation as a “high risk” organization

What are the Issues

Faculty spent less time on grants than proposed reported charged

Audit Concerns Timeliness Sponsor approval of changes Salary transfers Cost share Proposed salaries = effort commitments = actual effort

Resources

FEC website: http://www.washington.edu/research/maa/fec/

eFECS website: https://f2.washington.edu/fm/efecs/

Cost share website: http://www.washington.edu/research/gca/costshare

GIM 15: Transfer of Expenditures between Budgets http://www.washington.edu/research/osp/gim/gim15.html

GIM 35: Effort Reporting Policy for Sponsored Agreements:• http://www.washington.edu/research/osp/gim/gim35.html

Faculty Effort Certification, online training Non-Clinical Version: http://depts.washington.edu/fecnon Clinical Version: http://depts.washington.edu/fecclin

The Code of Federal Regulations (CFR) Title 2, Volume I, Part 220 (OMB Circular A-21) Defines allowable costs and effort reporting requirements

The Code of Federal Regulations (CFR) Title 2, Volume I, Part 215 (OMB Circular A-110) Sets administrative standards

Help

efecs@u.washington.edu eFECS Effort and Cost Share Modules

GCAHelp@u.washington.edu Cost share pledges

http://f2.washington.edu/fm/maa/contact Compliance

Congratulations

Change or Delete? Column D and Total Column to reflect increase in Cost Share..3 --------44.1

.3

-.3

----9.0

----55.9

Change or delete SHORT TERM SHIFT IN FUNDING SOURCE

5.6%.

5.6%

-5.6%

Budget 61-6850 - Short term shift in funding source

----49.4%----10.0%

----50.6%