1. Research Administrators Council Effort Process Better Business Practices Presenters: Leslie Levine, Denise Murrin-Macey November 2006

2. Research Administrators Council Effort Process Practices Are In the News Institutional effort reporting records are subject to audit; may provide grounds for disallowance. Increasingly federal auditors are scrutinizing effort processes vis-à-vis institutional practices. Several major universities have recently settled substantial unfavorable audit findings with regard to their effort practices. In light of the current climate it was deemed prudent to review and assess CMU’s current effort processes @ the invitation of Deborah Moon, CMU Vice President for Finance, the RAC Executive Board has done so

3. Research Administrators Council Examples of Recent False Claims Act Cases Involving Federal Research The following are from a presentation at NACUA* June 2006 Clark Atlanta UniversityApr 2006 $5M University of Connecticut Jan 2006 $2.5M Rush U Medical CtrDec 2005$1M U Medicine & Dentistry NJDec 2005 $4.9M Cornell-WeillJun 2005$4.28M Mayo ClinicMay 2005$6.5M Univ AL BirminghamApr 2005$3.39M Florida Intl UFeb 2005$11.5M Harvard/BIDJul 2004$3.3M Johns HopkinsMar 2004$2.6M U CA Lawrence LivermoreFeb 2004$3.9M Northwestern UFeb 2003$5.5M *National Association of College and University Attorneys

4. Research Administrators Council Why the RAC Executive Board? Who Are We? Research Administrators Council Executive Board Representatives are from: Carnegie Institute of Technology College of Fine Arts College of Humanities & Social Sciences Cost Analysis David A. Tepper School of Business H. John Heinz III School of Public Policy & Management Human Resources Mellon College of Science Office of Sponsored Projects School of Computer Science Software Engineering Institute Sponsored Projects Accounting Additional personnel energies for this project are being contributed by Financial Systems Team Payroll

5. Research Administrators Council Background Information – Effort Process A.Federal requirement OMB Circular A-21 J.8 (J. General Provisions for selected items of cost – 8. Compensation for personal services) A-21 requires institutions to develop and execute on a regular schedule a means by which individuals’ efforts are confirmed (a.k.a. effort certification) B. CMU activity CMU employs “after the fact” reporting” – see http://www.whitehouse.gov/omb/ciculars/a021/a021.html

6. Research Administrators Council Findings: Good News: CMU is in compliance with effort process federal mandate in A-21 There is, however, room for improvement – working group noted particularly the following as areas for immediate address: Effort reports currently distributed via email are regularly reported as being difficult to understand Negative affirmation may be determined to be an unreliable indicator of review/approval by “first hand knowledgeable” individual Generally there is no documentation beyond initial, single email distribution

7. Research Administrators Council Effort Process Better Business Practices The purpose of this presentation is to share three measures seen as facilitating immediate better business practice with regard to the effort process Informational tools for “players” (2 items) Templates for enhancement of “first hand knowledge” verification (1 item)

8. Research Administrators Council The “Players” and their effort certification procedure responsibilities Employee – any individual whose effort is charged Principal Investigator/Project Manager/Project Director Department ORACLE effort administrator (e.g., Business Manager)

9. Research Administrators Council Planned Effort Reports Currently, planned effort reports are distributed via email on or about the 18 th of each month. Types of Planned Effort Reports and Recipients Planned Effort by Employee HREM Schedule Supervisor Planned Effort by Account ORACLE production identified Grants Project Managers, Award Managers, and Principal Investigators; certain GL users Labor Schedules by Employee HREM ORACLE Supervisor

10. Research Administrators Council Reminder: Supervisor Types in HRIS/HREM Planned effort reports are distributed to the ORACLE Supervisor and/or Schedule Supervisor as identified in HREM. HREM Supervisor definitions are: ORACLE Supervisor –Effort Certifier in ORACLE (and ORACLE Default Purchasing Approver) –Required entry for all employees –This supervisor will receive an ORACLE Labor Distribution email report to review the monthly planned effort reports. Schedule Supervisor –This supervisor will receive an ORACLE Labor Distribution email report to review the monthly planned efforts. –Employees may have multiple schedule supervisors. Performance Supervisor –Responsible for the employee’s performance review and management. –Required entry for all staff employees –There is no ORACLE functionality associated with this designation

11. Research Administrators Council Procedural Enhancements (a) Addition of an e-mail distribution to Business Managers 3 – 5 business days prior to the distribution of the planned effort reports. reminder to update labor schedules so most current information is reflected in planned effort reports (to be distributed shortly) Email Text: This email is being sent as a reminder that planned effort reports will be distributed on the 18th of this month. If changes are needed to any of these schedules you should do so ASAP. This will facilitate the official monthly effort report distributions being as accurate as possible. Again, the purpose of updating labor schedules prior to the 18th is to provide recipients of the planned effort report with the most updated schedule information for their employees and accounts.

12. Research Administrators Council Procedural Enhancements - continued (b) Format of planned effort reports All planned effort reports provided via email will be distributed as PDF attachments PDF planned effort.pdf

13. Research Administrators Council Enhancement of documentation regarding “first hand knowledge” of effort As per A-21 “(2) After-the-fact Activity Records: (c) ….To confirm that the distribution of activity represents a reasonable estimate of the work performed by the employee during the period, the reports will be signed by the employee, principal investigator, or responsible official(s) using suitable means of verification that the work was performed.” CMU’s current ORACLE effort certification process is generally completed by individuals who may not have “first hand knowledge.” Departments may consider implementation/enhancement of file documentation verifying effort review/certification by appropriate personnel (e.g., PIs) – the following are examples of such practice. Benefits include: strengthened assurance of review by knowledgeable personnel, and affirmation of responsibility for effort assignment; execution and verification.

14. Research Administrators Council

16. Effort Process – An ongoing quest There will be more on this topic. Topics identified by the working group areas for address include: Articulation of comprehensive effort administration documentation (inclusive of procedures and “player” responsibilities). Possible modification of options for “hands on” ORACLE system effort certifiers Development of effort administration “training” Development of electronic routing of personnel effort certifications (e.g., from employee to supervisor to …) Consideration of the role of faculty PIs in the process Continued monitoring of external environment (e.g., other institutions’ practices regarding effort processes, published audit findings and responses, agency directives and expectations)

17. Research Administrators Council Feedback, Questions, Concerns We welcome feedback and suggestions on this topic. Contact any working group member (list follows) Questions? Concerns?

18. Research Administrators Council Effort Process Working Group Members: Colleen Bendl Anne Marie Bosnyak* John Chinn* Sara DeRoy, CRA* Karen Eck Eileen Eicheldinger* Liz Fox, CRA* Rhonda Kloss* Leslie Levine, CRA* Kathy Majors, CRA* Donna Marano, CRA* Emily Marshall* Sharon McCarl, CRA* Jeff Moreci, CRA* Denise Murrin-Macey, CRA* Ronald Placone* Joe Sullivan* AnnMarie Zanger, CRA* Deborah Moon, ex officio * RAC Executive Board Member