Presentation is loading. Please wait.

Presentation is loading. Please wait.

Cost Sharing for Sponsored Programs College of Agriculture, Food, and Natural Resources March 19, 2010.

Similar presentations


Presentation on theme: "Cost Sharing for Sponsored Programs College of Agriculture, Food, and Natural Resources March 19, 2010."— Presentation transcript:

1 Cost Sharing for Sponsored Programs College of Agriculture, Food, and Natural Resources March 19, 2010

2 2 Learning Objectives To understand: Fiscal compliance requirements related to cost sharing Responsibility of Research Administrator and Principal Investigator Frequent issues and impact of non-compliance

3 Definitions Cost Sharing – the portion of a project’s costs not borne by the sponsor. Types include: Mandatory – cost sharing required by the sponsor as a condition of award. Voluntary – Committed – not required, but has been implied based on inclusion in the budget or proposal narrative. Voluntary – Uncommitted – arises after the award is in place. 3

4 4 Methods of Cost Sharing Internal Salary and benefits – PI, faculty Other – equipment, materials Third Party – other than University or sponsor Subcontract – work on award Cash – donated funds Other – donated services, materials

5 5 Compliance Requirements What compliance requirements apply to Cost Sharing? OMB Circular A-110 – Administrative Requirements, subpart C.23. OMB Circular A-21 - Cost Principles for Educational Institutions – J.10. Effort Reporting UM System - APM 60.30 – Cost Share Sponsor Guidelines

6 6 Compliance Requirements Cost sharing must be: Allowable as a direct cost Incurred during the award period Necessary and reasonable for the award Verifiable from the University’s records Only counted one time

7 7 Compliance Requirements Prior approval required if: One Federal award will be used to cost share on another Federal award. Unrecovered Facilities & Administrative (F&A) costs will be used as cost share. Any unallowable costs are used to cost share. Cost sharing for different categories than original budget. Work with OSPA to get sponsor approval.

8 8 Cost Sharing Myths Cost sharing: Dollars are not real dollars Has no affect on the University Does not have to be documented Voluntary commitments do not have to be met The PI is more likely to receive the award if some voluntary cost share is committed.

9 NSF Guidelines “No expectation that proposals will include a cost sharing component… Solely at discretion of the institution… Once proposed and accepted, commitment becomes legally binding and subject to audit.” Per NSF Guidelines Chapter II, Part D. 9

10 Cost Sharing - Proposal Committed cost share must be approved Evaluate for reasonableness Both $$ and % of total cost Ability to meet the commitments Compare with existing commitments Ensure all cost sharing is identified – direct or implied Implied – certain language and other wording insinuates the PI will commit effort. 10

11 Cost Sharing – Award Set-up All mandatory and voluntary committed cost share must be accounted for in the Financial System. Establish cost share ChartFields Third party cost share is not tracked in the University’s financial system. Separate ProjectID if another University Business Unit. 11

12 Cost Sharing – During Award All cost sharing must be: Verified, recorded, and reported Monitored at least quarterly Properly documented Effort reports include cost sharing Fund 0000 with same project 12

13 Cost Sharing – Closeout Reported in final financial report Ensure all cost sharing is: Allowable Properly documented Met per commitments – both mandatory and voluntary 13

14 Third Party Cost Sharing Obtain a letter at proposal to quantify commitment Regularly monitor commitment status Ensure proper documentation Certification from third party 14

15 15 PI Responsibility Know policy and compliance requirements Share administrative management responsibility with Research Administrator Ensure all cost sharing is: Allowable Approved Documented Commitments are met

16 16 Research Administrator Responsibility Know policy and compliance requirements Aware of all committed cost sharing Direct or implied in budget and narrative Monitor to ensure cost sharing is met Ensure all cost sharing is documented Alert PI of potential or known compliance issues

17 Frequent Issues Unaware of implied commitments Unallowable costs used as cost sharing Outside period of availability Pre-approval not obtained for exceptions Commitments are not timely tracked or met Third party compliance 17

18 18 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

19 Frequently Asked Questions The following Frequently Asked Questions provide examples of issues related to cost sharing. 19

20 Frequently Asked Questions What does the PI need to do to use funds from a non- federal award to cost share on a proposal? Approval from Dean or equivalent to ensure funds are not already committed. No additional external approval needed. 20

21 Frequently Asked Questions Specialized equipment was purchased from departmental funds in September 2008. This equipment will be used on a new project where the performance period starts January 1, 2009. Can the equipment be used as cost sharing on the new award? No. The equipment was purchased outside the period of availability. 21

22 Frequently Asked Questions On a proposal requiring mandatory cost sharing, the PI decides to use 10% of his administrative assistant’s salary. Can this be used as cost sharing for the award? No. Unallowable costs cannot be used as cost share. However, work with OSPA to determine if an unlike circumstance exists. Obtain sponsor approval and document the unlike circumstance in the award. 22

23 Frequently Asked Questions A sponsor has mandatory cost sharing and limits F&A to 10%. The PI decides to use unrecovered F&A. Can the unrecovered F&A above the 10% limit be used as cost sharing on the award? No. You need to work with OSPA to obtain an exception from the sponsor before the proposal is submitted. Sponsor approval must be documented in the award. 23

24 Frequently Asked Questions The PI has not included any of her effort in a proposal, but does include other faculty salaries. Is there cost sharing involved with this award? Yes. There is implied cost share as the PI will contribute some minimum amount of effort. There are certain exceptions where PI does not have to contribute any effort. 24

25 Frequently Asked Questions What are examples of awards where the PI is not required to commit any effort? Examples include: Equipment grants. Dissertation support, training grants, or other awards intended as “student augmentation”. Limited purpose awards such as travel grants and conference support. 25

26 Frequently Asked Questions The PI commits 10% of his salary as cost share. Later, the PI is unable to meet the salary commitment with his effort, but wants to use another faculty member’s salary. Can the other faculty member’s salary be used to meet the cost share commitment? No, unless prior approval is obtained from the sponsor before it is charged as cost share. This is considered a change from the original proposal since the PI is named in the award. If approved, maintain documentation from sponsor as part of award file. 26

27 Frequently Asked Questions The PI commits 10% of a faculty member’s salary as cost share. Later, the PI notes this faculty member will not be working on the award, but another faculty will be instead. Can the PI use the other faculty member’s salary to meet the cost share commitment? If the faculty was named in the award, this is considered a change from the original proposal and requires prior approval from the sponsor before it is allowed. If approved, maintain documentation from sponsor as part of award file. 27

28 Frequently Asked Questions The PI has a 3-year award with a 10% cost share commitment of his salary each year. During year 2, he realizes the commitment hasn’t been met for the first year, but feels he will be able to catch-up by the end of year 2. What does the PI need to do? Work with OSPA to contact the sponsor to determine how to remedy cost share requirements. 28

29 Frequently Asked Questions A proposal includes the use of others “as needed” to consult or advise occasionally on the award. Is there any committed cost sharing when referring to people in this way? No. Since it is difficult to quantify the effort that will be contributed. 29

30 Frequently Asked Questions In the proposal, cost share was committed as a percentage of an individual’s effort and an estimate of the future salary was included. Is the cost sharing commitment tied to the estimated dollar amount or the percentage of effort? The commitment is tied to the percentage of effort. If the actual dollar amount is higher, ensure sufficient budget is available to cover the charges. 30

31 Frequently Asked Questions A $200K award includes a mandatory 5% cost share. The budget included $10K of equipment and in the proposal narrative, the PI notes he will contribute 15% effort to the project. What is the total cost sharing involved with this award? The total committed cost sharing is: Mandatory 5% - $10K of equipment, and PI effort of 15% of his salary - voluntary commitment 31

32 Frequently Asked Questions When should the sponsor be notified? Before you do any of the following, need approval from sponsor: Using unrecovered F&A as cost share. Using any unallowable costs as cost share. Cost sharing for different categories than original budget. Work with OSPA to notify sponsor in all instances. 32

33 Frequently Asked Questions An award pays for a graduate student’s stipend. The PI provides academic oversight for the student, but does not commit any effort. Has the PI voluntarily committed cost sharing? No. In this instance, the time of the PI is considered academic oversight and part of his/her regular administrative responsibilities. 33

34 Frequently Asked Questions In the Notice of Grant Award the proposed budget is reduced by 10% in total by the sponsor. Is this reduction of 10% considered cost sharing? The scope should be reduced before accepting the award. Work with OSPA to revise your budget to eliminate any potential for voluntary committed cost share before signing the award. 34

35 Frequently Asked Questions A PI receives an NIH award and the salary cap for this year is $196,700. His annual salary is $225,000. Is the excess salary considered cost sharing? If so, what type? Yes, the excess salary over the NIH cap is considered cost sharing.

36 36 Contact Information Evelyn Lindell Administrative Manager 882.8295 LindellE@missouri.edu Craig David Lead Accountant, Gold Team Office of Sponsored Programs Administration 882.9570 davidcr@missouri.edu

37 37 References Where can I find more information? OMB Circular A-110 OMB Circular A-21 APM 60.30 – Cost Sharing Reference Guide for Sponsored Programs


Download ppt "Cost Sharing for Sponsored Programs College of Agriculture, Food, and Natural Resources March 19, 2010."

Similar presentations


Ads by Google