June 8-11, 2009Joint Annual Meeting Human Resource Development National Science Foundation Office of Inspector General John P. Cieplak, Investigator Laura Hansen-Rainey, Audit Manager

June 8-11, 2009Joint Annual Meeting Human Resource Development Our Mission Office of Inspector General (OIG) – Created 02/10/89 at NSF – Conduct independent audits, investigations, and reviews of NSF and its programs – To promote efficiency, economy and effectiveness of internal operations and external programs thereby promoting the integrity of NSF

OIG Performs Its Mission Investigations – Allegations –Fraud, waste, and abuse –Violations of federal policy, laws, etc. –Research Misconduct Audit – Conduct / Oversee Audits –Internal, external, and A-133 audits Outreach – Presentations / Briefing June 8-11, 2009Joint Annual Meeting Human Resource Development

Office of Investigations Civil & Criminal Investigations Administrative Investigations June 8-11, 2009Joint Annual Meeting Human Resource Development

What We Do With Allegations Investigate administrative, civil, criminal allegations –May refer to federal, state, or local authorities, as well as to NSF –Criminal or civil outcomes – prosecution or settlements –Administrative outcomes – award termination, restrictions, debarments June 8-11, 2009Joint Annual Meeting Human Resource Development

Investigative Process Allegation received in OIG Conduct preliminary investigation Investigate substantive allegations Report of investigation – conclusions, recommendations If appropriate, refer to audit Work with NSF, DOJ, and awardee June 8-11, 2009Joint Annual Meeting Human Resource Development

Institutional Responsibilities Notify OIG –Of allegations of wrongdoing –Of significant administrative or financial problems –That affect NSF awards or interests Take appropriate remedial actions Respond to OIG’s requests for records and information June 8-11, 2009Joint Annual Meeting Human Resource Development

Research Misconduct Fabrication – making up data or results & recording or reporting Falsification – manipulating materials, equipment or processes, or changing / omitting results, data Plagiarism – misappropriation of another’s ideas, words, results June 8-11, 2009Joint Annual Meeting Human Resource Development

Research Misconduct Institutions are required to report substantive allegations to OIG OIG frequently defers investigation to let institution investigation proceed Subjects have substantial due process Confidentiality is protected Certain timelines apply

Civil / Criminal Trends Purchase card abuses Poor time & effort documentation Shifting costs between projects Failing to contribute cost sharing Mischarging for budget items unrelated to award June 8-11, 2009Joint Annual Meeting Human Resource Development

Common Civil/Criminal Issues Embezzlement/Theft Fraud (including mail or wire fraud) False Statements/Claims Civil False Claims (treble damages) Criminal False Claims Obstruction of Justice June 8-11, 2009Joint Annual Meeting Human Resource Development

Other Investigative Concerns Conflicts of interest Improper influence on peer review Lobbying with federal funds Commingling federal & non – federal funds Dual Compensation – paid by NSF and other sources June 8-11, 2009Joint Annual Meeting Human Resource Development

Keys to Success Effective Award Management –Know requirements –Focus on research –Good accounting practices –Request & document NSF approvals Effective Compliance Programs –Risk assessment & stewardship June 8-11, 2009Joint Annual Meeting Human Resource Development

American Recovery and Reinvestment Act of 2009 Related to ARRA funds, the Act prohibits reprisals against any non-federal employee for reporting: Gross mismanagement; waste; danger to public health or safety; abuse of authority; implementation or use of covered funds; or violation of law, rule, or regulation related to ARRA funds. June 8-11, 2009Joint Annual Meeting Human Resource Development

ARRA 2009 Institution & contractor employees may submit complaints to OIG OIG investigates unless frivolous, no covered $ involved, or another adjudicative proceeding is underway Institutions & employers are required to post notice of employee rights and remedies

June 8-11, 2009Joint Annual Meeting Human Resource Development Office of Audit Internal Audits External Audits A-133 Audits

June 8-11, 2009Joint Annual Meeting Human Resource Development Internal Audits Evaluate the internal operations of NSF Review agency policies and procedures Evaluate agency processes Make recommendations for improvements

June 8-11, 2009Joint Annual Meeting Human Resource Development External Audits Financial aspects of institutions who conduct NSF-funded research Review internal controls and compliance Audits performed by OIG auditors and/or CPA firms

June 8-11, 2009Joint Annual Meeting Human Resource Development Common Audit Findings Unallowable Costs Award administration Sub recipient monitoring Cost sharing

June 8-11, 2009Joint Annual Meeting Human Resource Development Determination of Costs Allowable, reasonable, allocable, documented, consistent treatment of costs Unsupported costs Expenditures and/or reimbursements not properly documented Time and effort reports not timely, not signed/certified

June 8-11, 2009Joint Annual Meeting Human Resource Development Unallowable Costs Direct charges for costs in the indirect pool Overload salary (unless NSF- approved) Meals above per diem, alcohol Expenditures not permitted under OMB Cost Circulars

June 8-11, 2009Joint Annual Meeting Human Resource Development Award Administration Financial Management System Document participant support per award Ensure accuracy and timeliness of reporting and notifications Maintain equipment inventory and document bi-annual counts of federally-funded inventory

June 8-11, 2009Joint Annual Meeting Human Resource Development Subrecipient Monitoring Responsible for program and financial oversight Ensure award terms / federal requirements are followed Assess and monitor subrecipient's capability for managing awards Ensure timely and appropriate corrective action

June 8-11, 2009Joint Annual Meeting Human Resource Development Cost Sharing No federal funds can be used (as a general rule) Track cost sharing per award (no duplication) Documented and certified (AOR >$500,000) Valuation at actual/fair market value Report annual and cumulative amounts Both awardee and subawardee cost sharing

June 8-11, 2009Joint Annual Meeting Human Resource Development A-133 Audits Audit of financial statement, internal controls, and compliance with federal requirements Required each year when auditee expends $500,000 or more in federal funds OIG reviews completed reports for identification of NSF-related findings and questioned costs, and for quality of audit reports

June 8-11, 2009Joint Annual Meeting Human Resource Development Results of A-133 Audits April 2008 – March 2009 –Reviewed 320 reports –Reports covering $9.4 billion in NSF expenditures –Less than unqualified opinions for 37 awardees –Auditors disclosed 412 audit findings

June 8-11, 2009Joint Annual Meeting Human Resource Development When Should You Contact OIG? Report allegations of wrongdoing Research misconduct Financial fraud, theft from NSF or NSF-funded activities Violation of research related regulations, directives, or policy Report significant administrative or financial problems

June 8-11, 2009Joint Annual Meeting Human Resource Development When Should You Contact OIG? Request an Outreach event or training session Questions related to ongoing audits (including A-133 audits) and investigations (but confidentiality restrictions may apply)

June 8-11, 2009Joint Annual Meeting Human Resource Development OIG Outreach Presentations, Seminars, and On- Site Visits For students, PIs, and administrators Emphasize education, partnerships, and lessons learned Assistance with matters relating to Investigations /Audits and NSF activities

June 8-11, 2009Joint Annual Meeting Human Resource Development How Can I Contact OIG? Website: Outreach website: US Mail: 4201 Wilson Blvd., Arlington, VA Phone: Hotline:

June 8-11, 2009Joint Annual Meeting Human Resource Development OIG Liaisons to EHR John P. Cieplak Laura Hansen-Rainey

June 8-11, 2009Joint Annual Meeting Human Resource Development Questions??