Fiscal Compliance Corner Recent Happenings, etc. MRAM August 2014 Ted Mordhorst Director for Post Award Financial Compliance Research Accounting & Analysis

OMB Uniform Guidance (Omni-Circular) Published in Dec with an effective date of Dec 26, CFR 200 Applies to new funds. Implication is that two sets of rules will apply for a while: A-110/A-21 for existing awards made prior to Dec 26 th Uniform Guidance/ Agency implementation regulations for new awards/funds

OMB Uniform Guidance  We have a team of Subject Matter Experts working on this:  Members from Central offices and Departments  Draft changes to policy due by Sept 30th.  Will share with University community for feedback.

OMB Uniform Guidance  Awaiting Agency implementation plans  Discussions are underway with OMB concerning the dual regulation application and other troubling clauses such as:  Small purchase threshold of $3K above which some evidence of comparison of other vendors has taken place. (competitive bid?)  Closeout within 90 days of end date.

OMB Uniform Guidance  Changes to UW Policies and Procedures  Potential some new GIMs  Internal Controls  Subrecipient Monitoring  Transfer of Residual Balances (Fixed Price awards)  Equipment

OMB Uniform Guidance  Changes to UW Policies and Procedures  Revisions to existing GIMS  7 - Subcontracts for Research  10 – Significant Financial Interest  13 – F&A rates  18 – Post Award Admin- NIH awards  21 – Cost Sharing  23 – Costing Policy  39 - Closeout

OMB Uniform Guidance  Equipment/Computing Devices  Under Materials & Supplies:  “In the specific case of computing devices, charging as direct costs is allowable for devices that are essential and allocable, but not solely dedicated, to the performance of a Federal award.”  Includes desktop, laptops, tablets, etc. with a cost of $2K or less.

OMB Uniform Guidance  Administrative & Clerical Salaries  “should normally be treated as indirect (F&A) costs. Direct charging of these costs may be appropriate only if all of the following conditions are met:”  No change from prior regulation  Did delete the reference to “major programs”

OMB Uniform Guidance  Administrative & Clerical Salaries (Cont.:  The services provided are integral ( essential, necessary )to a project or activity;  Individuals can be specifically identified with the project or activity;  The costs are explicitly ( leaving nothing merely implied ) included in the budget or have the prior written approval and  The costs are not also recovered as indirect costs.

OMB Uniform Guidance  Cost Sharing or Matching:  “Under Federal research proposals, voluntary committed cost sharing is not expected.  It cannot be used as a factor during the merit review of applications or proposals,”  But it may be considered if it is both in accordance with Federal awarding agency regulations and specified in a notice of funding opportunity.  “Criteria for considering voluntary committed cost sharing … must be explicitly described in the notice of funding opportunity”

Audit News GOOD NEWS! NSF sided with an institution in resolving most audit findings from a recent audit NSF management disagreed with the auditors and allowed over $5 million of auditor disallowed expenses. Most disallowed costs were incurred near the end of the award periods.

Other Audit News  Disallowed costs:  Items purchased near the end of an award period.  Implied that the cost should at the least be allocated based on the use in meeting project objectives.  Lack of documentation that supports the allocation decision.