1. 1 Roles and Responsibilities Principal Investigators University of Missouri – St. Louis College of Education February 11, 2009

2. 2 Learning Objectives To understand: –Principal Investigator (PI) responsibility for sponsored programs –Key fiscal compliance requirements –Common issues and impact of non- compliance

3. Overview I.Definitions II.Compliance Requirements III.Responsibility IV.Common Issues V.Concluding Points 3

4. Definitions Sponsored Award – Activities related to a proposal funded by an external entity for a specific purpose. PI/Co-PI – Principal Investigator. Named by sponsor on award document with ultimate responsibility for ensuring compliance. Fiscal Officers – the individual assisting the PI with the administrative management of an award. 4

5. Definitions Unallowable costs – Costs charged to an award not meeting the requirements. APM – Accounting Policy and Procedures Manual. Codification of accounting policies. BPM – Business Policy Manual. Codification of business and administrative policies. 5

6. 6 Compliance Requirements Who sets the requirements? Office of Management and Budget (OMB) – Oversight agency for the federal government –OMB Circulars – The federal rules for how awards are to be administered. Sponsors – Individual sponsors may have additional requirements APM and BPM – policies established jointly by Campuses and UM System

7. 7 Compliance Requirements Who enforces the requirements? External Auditors – Identify questionable costs and internal control issues. Office of Inspector General (OIG) – Final enforcer of requirements. May require funds be returned to sponsor, impose fines, and/or sanctions.

8. 8 Compliance Requirements What compliance requirements apply to sponsored programs? –OMB Circular A-21 - Cost Principles for Educational Institutions –OMB Circular A-110 - Administrative Requirements for Grants and Agreements –OMB Circular A-133 - Single Audit Requirements –Specific Sponsor Administrative Guides

9. 9 Compliance Requirements When do these requirements apply? –Receipt of direct federal awards –Awards containing federal flow-through dollars –Awards where terms and conditions reference OMB Circulars However, the University requires all awards to follow the requirements for federal awards.

10. PI Responsibility 1.General Compliance and Oversight 2.Project Planning and Proposal Submission 3.Award Set-up 4.Management During the Award 5.Award Closeout and Reporting 6.Effort Verification Reports 7.Cost Transfers 8.Cost Sharing 9.Subawards 10

11. 1. General Compliance, Oversight Aware of applicable requirements –OMB Circulars, University policies –Sponsor restrictions Ensure compliance Attend training Work with Fiscal Officer The PI has the ultimate responsibility 11

12. 2. Planning/Proposal Submission Complete proposal timely Obtain all approvals (PSRS) Manage technical/programmatic negotiations with sponsor Establish pre-award accounts Ensure all costs are allowable and unlike circumstances are justified 12

13. 3. Award Set-up Notify ORA upon receipt Delegate authorization Ensure accuracy of budget in PeopleSoft Identify federally funded equipment Establish payroll distribution of effort - PAF See APM 60.35 – Establishing an Award 13

14. 4. Management of Award A.Monitor project timely B.Ensure all expenses are authorized C.All charges are allowable D.Notify sponsor for significant changes E.Supporting documentation exists 14

15. 4A. Monitor Project Timely Managerial review monthly: –All costs are posted and allowable –Within the period of availability –Unreasonable or unusual activity –Address budget deficits or excess costs Notify sponsor if significant changes –Sign/date documentation evidencing review See Segregation of Duties – APM’s 2.25.55 and 2.25.55.01 15

16. 4B. Proper Authorization Ensure all expenses are authorized PI may delegate authorization: –Direct knowledge of the sponsored award –Aware of terms and conditions –Aware of compliance requirements –University employee See APM 2.25.55.01 – Segregation of Duties – Sponsored Programs and 2.25.55.02 – Delegation Form 16

17. 4C. Allowable Charges Ensure all costs are allowable –Per OMB (A-21) and sponsor requirements Allowability requirements: Reasonable Allocable Consistent Treatment Conform to limitations or exclusions 17

18. 18 4C. Allowable Costs Direct costs must be: –Identified specifically for a particular sponsored award –Directly assigned with relative ease and a high degree of accuracy –Consistently treated in like circumstances –Supported by documentation

19. 19 4C. Allowable Costs F&A is: –Incurred for a common or joint objective (e.g. utilities) –Cannot be easily identified with a particular award Facilities: depreciation, interest on related debt, operational, maintenance, and library costs. Administration: departmental, sponsored projects, student services, and other general administrative costs.

20. 20 4C. Allowable Costs Certain costs are expressly unallowable: –Alcoholic beverages –Alumni activities –Bad debts –Donations and Contributions rendered –Entertainment –Furnished automobile – personal use –Goods or services for personal use –Housing and personal living –Losses on other sponsored agreements

21. 21 4C. Allowable Costs Certain costs are unallowable with exceptions: –Contingency provisions –Fines and penalties –Fundraising and investment costs –Lobbying –Pre-agreement costs –Selling and marketing costs –Student activity costs Must be specified in the agreement to be allowable!

22. 4D. Notify Sponsor Notify sponsor when there is a: Change in scope or objective Significant change in budget Change in key person specified in award Absence of the PI for more than 3 months, or a 25% reduction in time devoted No-cost time extension Work with ORA to notify sponsor 22

23. 4E. Supporting Documentation What is considered adequate documentation? –Sufficient Documentation should state: the charge is allowable, and the charge directly benefits the related award. –Substantial Documentation (for cost transfers > 60 days old) should address: Who, What, When, Where, and Why? How will error be prevented in future? 23

24. 5. Award Closeout & Reporting Ensure awards are closed timely –Review notice of award closings –Closeout deficits Provide final technical reports Certify allowability of costs Documentation exists for all costs See APM 60.20 – Closing Sponsored Awards and APM 60.07.01 - Certification 24

25. 6. Effort Verification Reports Ensure all payroll costs directly charged reflect actual efforts All EVRs are reviewed, signed, and completed by due date Signed by person with suitable means Update payroll records for differences > 5%. Note: 100% funding of PI is red flag See APM 60.32 – Effort Verification Reports 25

26. 7. Cost Transfers A reallocation of costs to an award after the transaction has occurred To correct an error All cost transfers should be: –an allowable and allocable charge, –properly documented, and –made in a timely manner. See BPM 213 – Adjustment of Income and Expense Items 26

27. 7. Cost Transfers Cost transfers should not be done to: –Meet budget deficits –Avoid restrictions –Shift unrestricted budget –Spend out unused award budget –For other conveniences Red flag if excessive transfers at end 27

28. 8. Cost Sharing At proposal: –Identify funding source –Obtain appropriate approvals –Document exceptions in agreement During the award: –Ensure cost sharing requirements are met –All cost sharing is allowable –Documentation exists to support 28

29. 9. Subawards Determine the need, scope, and budget for subaward Ensure proper classification Monitor progress and deliverables Review and approve payments Subject to same compliance requirements See APM 60.85 – Subrecipient Monitoring Procedures 29

30. Common Issues Unallowable costs on projects Lack of documentation: –Cost Transfers –Cost Sharing – supporting requirements Incomplete and/or late EVRs Late cost transfers Purchases in last 3 months of award Delay in filing final reports 30

31. 31 Impact of Non-Compliance Questioned or unallowable costs Repayments to the sponsor Fines and/or sanctions Subject to additional external audits Jeopardize future funding opportunities Damage to reputation

32. Checklist for Success Ensure costs are: Authorized in the budget & agreement Charged timely to the project Meet the requirements of allowability Timely review budget and costs Make timely and allowable cost transfers Appropriately document all costs 32

33. 33 References Where can I get more information? –OMB Circular A-21OMB Circular A-21 –University Controller’s Office Policies – APM – Section 60APM – Section 60 –Reference Guide for Sponsored ProgramsReference Guide for Sponsored Programs –PI Roles and ResponsibilitiesPI Roles and Responsibilities –Facilities & Administration Fiscal Misconduct HotlineFiscal Misconduct Hotline

34. 34 Contact Information Tina Hyken Business and Fiscal Operations Specialist 314.516.5127 Hykent@umsl.edu Karen Boyd Manager, Business/Fiscal Operations 314.516.5923 boyd@umsl.edu