1A Property Management Primer Key Elements Affecting Equipment in Research Presented by: Ivonne Bachar, CPPM CF Director, Property Mgmt. Office Stanford University Event: NCURA – Regions VI and VII Denver, CO April 4-6, 2011
2Discussion Encouraged! Today’s Focal PointsProperty Life Cycles – A Birds Eye LookKey TermsRegulatory ContextPre-AwardPost AwardClose-outs and AuditsDiscussion Encouraged!
3Terms & Concepts Accountability Stewardship Title Property Equipment CapitalDepreciationTitlePropertyEquipmentExempt EquipmentMaterialSuppliesScreeningCAPGFP/GFMNOTES:
4Property Life Cycle Close-out and Disposal Getting the Goods Property Rules & Business NeedsPolicies & ProceduresPhase IPhase IIPhase IIIClose-out andDisposal(Once item is excess)Getting theGoods(Need thru Acquisition)PropertyControl(In-use period)Tracking – Training – AwarenessReporting – Reconciliation – AdjustmentsAudits – Process Improvements
6Contractor Outcomes (Property Mgmt. System Components) AcquisitionReceiptRecordsPhysical InventorySub-contractor controlReportsUtilizationMaintenanceContract close-outFAR“Contractors shall develop property management plans and systems, at the contract, program, site or entity level that reflect their efforts to obtain best value”Notes:Imbedded Outcomes:Identification, Storage, Movement, Disposal, Management, and Audit
7Regulatory Requirements (Grants) Code of Federal Regulation / OMB Circulars2 CFR 220 ( OMB A-21)Cost Principles for Educational Institutions2 CFR 215 (OMB A-110)Uniform Administrative Requirements for Grants and Cooperative Agreements with Institutions of Higher Education, Hospitals, and other Non-Profit OrganizationsA-87Cost Principles for State, Local, and Indian Tribal GovernmentsA-123Management’s Responsibility for Internal ControlA-133Audits of Institutions of Higher Education & Other Non-Profit InstitutionsNOTES:
8FAR for Contracts Alternate II > > > Preferred Option Key Clauses:Alternate II>>Government Property>>Property PlanNOTES:Alternate II > > > Preferred Option
9, Alternate IIGives title to recipient for equipment under $5,000, provided that the recipient obtained CO’s approval before each acquisition.Gives title to recipient for equipment $5,000 or greater, with CO’s permission. (Note: Sponsor holds title during life of contract)NOTES:Applies only to Contractor Acquired PropertyBeware of Tax Implications
10Pre-Award Support SOW Property Plan for contract proposals Budget justificationsIdentify methods of acquisitionClearly defineFabricationsDeliverablesAcceptance and delivery criteriaNegotiate appropriate clause
11Acquisition Approved budget vs. authority to purchase Approvals & ScreeningFinancial & Reporting CategorizationExplicit listing of GFP neededImport & ExportEnd of period purchasesNOTES:
12Methods of Acquisition and Lifecycle Changes Sponsor FurnishedOr LoanedUniversity (Contractor) AcquiredLeaseRentDonationIf Sponsor TitleConsidered GFPIncoming TransfersTitle TransfersPurchasesFabrications
13Equipment Title – Grants SponsoredGRANTUniversityTitlePurchasesTaxable(OMB Circulars)13⅞Notes:In some cases granting agency may impose future use restrictions on equipmentIn rare cases when equipment is furnished on a grant or if specified in the terms of the grant, it is treated as sponsor owned.Some Federal Sponsors retain right to title, and may opt to reclaim to non-exempt property
14Equipment Title – Contracts <$5K University TitleF&A (aka IDC) AppliesFAR (Alt. II)$5K> Sponsor TitleNo F&A (aka IDC)FederalSponsored CONTRACTSponsor TitleNon-TaxableNo F&A (aka IDC)14⅞(FAR Clause)FARor per T&CNotes:Equipment furnished by Sponsor, remains sponsor-ownedNon-Federal, Sponsor-Owned equipment may be taxable (e.g. State of California)May request title transfer to Sponsor-owned property upon completion of award
15Property Title Driven by agreement type and T&Cs Affected by Acquisition MethodSource of fundingTitle determines taxabilityMay change throughout life of agreementDetermines reportingLimits disposition optionsHow might this affectProject Budgets or theProposal Process?NOTES:
16Remember Property at Subcontractor! Physical InventoryFrequency dependent on approved policies and procedures, State, or sponsor requirementsOMB A-110 & A21Biennial – you define scheduleVerification & reconciliationReportTiming, content, distributionUniversity financials vs. sponsorsMissing itemsFARPeriodically or per accepted proceduresGASBAnnual, or based on asset categoryRemember Property at Subcontractor!NOTES:
17Transfers (Incoming or Outgoing) Define items involvedAward type & statusFunding SourceMethod of acquisitionCurrent titleRetention requirementsCost or no-cost?ApprovalsImport-Export IssuesNOTES:“It Depends” starts here...
18Subcontracting Ensure your flow down addresses AT LEAST: Confirm recipient’s property systemAcquisition and TitleIdentification and RecordsPhysical inventoryReports, including LDDTUseDispositionRisk and LiabilityStewardship responsibilitiesNOTES:
19Subcontracts Title Issues, cont. The Prime needs to be careful not to give the sub greater title rights than the prime has been given; consider:What type of instrument is the Prime?Is the sub an eligible recipient?Is the sub doing research or other professional services?Are there restrictions on the prime’s clear title?How is GP affected?At what point is title granted to sub?NOTES:
20Include Sub-award info ReportsAgency SpecificManagement and Self AssessmentInternal AuditInterimFinancial and/or AccountabilityPhysical InventoryLoss, Damage, Destruction, TheftCorrective ActionFinal CloseoutNOTES:Include Sub-award info
21Other “Hot Spots” International and Collaborative Agreements Self-AssessmentsImport - Export controlsFabricationsJournal TransfersP-Card PurchasesIndirect Cost implicationsMulti-disciplinary projectsMulti-source fundingData Security
22It’s about integration Rules andRequirementsOrgs, Policies,Procedures,PeopleAssets and TechInfrastructureNotes:PropertyProfessionalSkills
23Thank you for being here today!!! Questions???Concerns???NOTES:Thank you for being here today!!!