Introduction Guy Narine Manager, Newark Grants Office Phone: (973) Fax: (973) – Date: 12/08/04

Reading and Interpreting the Online Financial Information System (OFIS) Monthly Report and Reconciling it with the Department’s Shadow System

Objectives To make financial monitoring of grants and contracts simpler, less stressful, less tedious and more useful. To provide you with information on how to manage and administer grants and contracts efficiently and effectively.

The Life Cycle of a Grant or Contract Pre-Award Process- Office of Sponsored Programs Grant/Contract Awarded Post-Award Process- Newark Grants Office Invoicing and Reporting Close Out Process Audit and Retention

What should I do when I receive notification that my Grant or Contract has been awarded? Contact Office of Sponsored Programs immediately (if Office of Sponsored Programs did not notify you). Wait for an account number and an introductory letter from Newark Grants Office. Get a copy of the agreement. Upon receipt of the introductory letter, verify that budget figures and items on OFIS match the agreement. Ensure personnel budgeted to be paid from grant/contract are being paid at the correct effort percentage. If PI wants to re-budget, check grant/contract terms and conditions to ensure that he/she is authorized to do so. Review and reconcile your accounts with the Grant Budget Reports (GBRs) on a monthly basis.

What is a Reconciliation? It is an act of accounting for a difference between two totals (for example, in our case, it is the balance in OFIS and the balance in your department’s shadow system). The difference may be a sum of reconciling items.

What are reconciling items? Reconciling items are transaction items accounted for in one system and not in the other.

1)Account Balance as of 11/30/04 on OFIS: Budget $XXX Less: Expenses to date $XXX Less: Commitments $XXX 2)Account Adjusted Balance based on your Shadow System: Account Balance arrived at in 1) above $XXX Plus/Less: Adjustments for Reconciling items $XXX Less: Good Commitments $XXX

Some Common Reconciling Items are: Payroll charges and adjustments; Staff Benefits; Purchase Orders not processed by the system; Invoices submitted to Disbursement Control to be processed for payment but not paid to date; F & A Costs; Projections for standard recurring charges; Subcontract amounts not committed.

Payroll reallocation for $1,500 to account 420XXX to be processed; Calculate Fringe Benefit (F/B), given F/B at 32.5%; Purchase Orders for $1,000 processed by department not reflected in the OFIS System; Invoices submitted to Disbursement Control for $500 not shown in OFIS; Calculate F & A, given current rate at 55.5%. Reconciling Transactions

Calculations Fringe Benefits: 32.5% = $488 F & A Costs: 55.5% = $1,935

Projections Standard recurring charges e.g. payroll charges, computing or telephone charges, etc; Staff Benefit charges on above payroll expenses, if applicable; Good commitments; Adjustments; F & A Costs on the above items, if applicable.

Projection for Standard Recurring Charges: 1)GA, Thomas Brown, is to be paid $1, per month for 3 months equals $3,000 2)Fringe 23% = $690 3)F & A Costs at 55.5% on $3,690 = $2,048

Amounts should be committed; Amounts not committed for new awards call Office of Sponsored Programs; Amounts not committed for old awards need to be tracked in shadow system; Keep track of number of sub awards, sub award amounts and expenditures to date for each award; Generally, the first $25,000 is subject to F & A Costs (unless waived). Subcontracts

Fringe Benefits FY05 Rates –1200Salaries- Regular Employees 32.5% –1230Wages of Labor 9% –1250Student Wages0% –1290Other Compensation 7.5% –1370Post Doctoral Associates 27.5% –1500Graduate Assistants 23.0%

Expense Subcodes and Corresponding Payroll Position Codes Subcode Position Code 1200 Salaries- Regular Employees & Wages of Labor Student Wages Other Compensation Faculty Summer Compensation Summer Employment – 10 mths Post Doctoral Associates Graduate/Teaching Assistants Training Grants – Stipends

Recap of what we reviewed today: How to read and interpret OFIS? Basic actions needed upon receipt of a notice of award. Reconcile your accounts with the OFIS monthly. How to project expenses and incorporate them into your reconciliation? How to account for Subcontracts?

Pre award Issues: Post award Issues: Standards for University Operations: Websites

QUESTIONS?