1. Hartford Hospital Research Institute Time and Effort Reporting Prepared By: HHC Office of Compliance, Audit and Privacy Angelo Quaresima, Research Compliance Specialist May 2013

2. What is Effort? Effort is defined as the amount of time spent on a particular activity, expressed as a percentage of all time you spend on your institutional responsibilities. It includes the time spent working on a sponsored project in which salary is directly charged (paid effort) or contributed (cost share effort). May 2013Time and Effort Reporting2

3. Why Do We Need to Report and Certify Effort? Federal Requirement 45 CFR 74 APPENDIX E - Principles For Determining Costs Applicable To Research And Development Under Grants And Contracts With Hospitals requires salary and wage charges to be supported by either actual time records or current and reasonable estimates of the percentage distribution of Total Effort. Hartford Hospital Requirement Research Institute - Time and Effort Reporting Policy provides guidance and outlines procedures to comply with federal requirements. May 2013Time and Effort Reporting3

4. Who is Required to Report and Certify Effort? Non-Exempt Employees : Effort for non-exempt employees is certified through the completion and approval of weekly HH KRONOS timecards. Exempt Employees: A monthly Time and Effort (T&E) Report must be completed and certified for any exempt employee with Committed or Actual Effort (paid effort or cost share) on federal or federal sub-recipient sponsored projects administered by HH. May 2013Time and Effort Reporting4

5. Federal Effort Reporting Requirements Reasonable estimates of the percentage distribution of Total Effort may be used as support in the absence of actual time records. Estimates of effort should be prepared by the individual who performed the services or someone, such as a supervisor or department head, with first-hand knowledge of the services performed. Percentage estimates must show the allocation of effort between organized research and all other hospital responsibilities. Estimates must be made no later than one month after the month in which the services were performed. May 2013Time and Effort Reporting5

6. HH T&E Reporting Key Points Institutional Base Salary (IBS) should be used when preparing budgets and charging salary to sponsored projects. (Note: Federal grants have an IBS cap) Committed Effort is your budgeted effort (paid effort or cost share) on the project which is accepted by the sponsor. Actual Effort is calculated based on a reasonable estimate of the percentage of Total Effort expended during the monthly reporting period. Total Effort must always equal 100% of your institutional responsibilities, regardless of hours worked during the week. Activities outside of your institutional responsibilities, such as consulting, are not included as part of your Total Effort. Time & Effort (T&E) Reports are used to document after-the-fact certification of Actual Effort on sponsored projects. T&E Reports must be completed and certified within 14 calendar days of distribution. May 2013Time and Effort Reporting6

7. Role of Principal Investigators HH is legally responsible to the sponsor, but the PI is held accountable for the proper fiscal management and conduct of the project. PI responsibilities include: Scientific performance of the work related to the project. Management of the project within funding limitations and in compliance with Federal regulations, sponsor requirements, and institutional policy. This includes oversight of effort certification and related charges for all personnel on the project. Sponsor notification when significant conditions related to the project change. Responsibility for the day-to-day management of project finances may be delegated to administrative or other staff. However, accountability for compliance with federal regulations, sponsor requirements, and institutional policy, ultimately rests with the PI. May 2013Time and Effort Reporting7

8. T&E Reports T&E Reports document that salary charged to a project is consistent with the Actual Effort provided during a specific time period. (Replaces a timesheet) T&E Report certification is the method of verifying that: Actual Effort supported and charged to the project has been performed as committed, and Actual Effort expended in support of a project but not paid by the project (cost sharing) has been performed as committed. May 2013Time and Effort Reporting8

9. T&E Reports HH monthly T&E Reports are pre-populated with Actual Effort percentages based on payroll distributions allocated within the accounting system. Employees need to review and certify Actual Effort percentages. If needed, T&E report percentages should be revised to reflect Actual Effort expended. For example: Investigator Z’s May 2013 T&E Report reflects 25% effort for project Y based on payroll distributions allocated within the accounting system. However, Investigator Z spent 40% Actual Effort on the project during the month. Investigator Z would need to adjust the T&E Report to reflect Actual Effort of 40% prior to certification and, if needed, request a cost transfer to adjust payroll charges. May 2013Time and Effort Reporting9

10. T&E Report Sample May 2013Time and Effort Reporting10

11. Actual Effort Calculation Formula Estimate of weekly hours spent on sponsored project Actual Effort % _________________________________________ = on Total hours in an average work week Sponsored Project (Total Effort) Actual Effort percentages should not be calculated on the basis of a 40-hour work week or any other "standard" work week. Actual Effort must always be calculated and expressed as a percentage of Total Effort. May 2013Time and Effort Reporting11

12. Effort Calculation Examples Doctor A Doctor A works 30 hours a week on Grant A and spends 20 hours a week on patient care and administrative responsibilities. Effort Calculation: 100% Total Effort for HH is 50 hours Actual Effort for Grant A is 60%, or 30/50 hours May 2013Time and Effort Reporting12

13. Effort Calculation Examples Doctor B Works 40 hours per week on patient care, research grant and administrative duties. Also is paid for serving on an outside scientific advisory board, averaging 5 hours a week. Works on two research grants, spending total of 10 hours a week on Grant A and 5 hours a week on Grant B. Effort Calculation: 100% Total Effort for HH is 40 hours, work on the outside advisory board is not included in total effort Actual Effort for Grant A is 25%, or 10/40 hours Actual Effort for Grant B is 12.5%, or 5/40 hours May 2013Time and Effort Reporting13

14. Effort Calculation Examples Doctor B Continued Doctor B obtains another research grant, expecting to spend 10 hours per week on Grant C and does not drop/decrease any other HH responsibilities. Effort Calculation: 100% Total Effort for HH is now 50 hours Actual Effort for Grant A is 20%, or 10/50 hours Actual Effort for Grant B is 10%, or 5/50 hours Actual Effort for Grant C is 20%, or 10/50 hours May 2013Time and Effort Reporting14

15. Cost Share Example Doctor C Mandatory Cost Share: A federal grant requires HH to match 50% of Doctor C’s salary on a project Actual Effort committed on the project for the month is 50% Institutional Base Salary (IBS) = $100,000 Calculation: $100,000 x 50% = $50,000 in salary expended to the project $50,000 x 50% = $25,000 should be charged to the project account $50,000 x 50% = $25,000 should be charged to a non-federal or departmental account and cost shared to the project May 2013Time and Effort Reporting15

16. Change in Committed Effort on NIH Grants Per NIH Grants Policy Statement, Part II, Subpart A, General—Administrative Requirements (October 1, 2010). HH is required to submit a prior approval request to NIH if the PD/PI or other Senior/Key Personnel specifically named in the Notice of Award will: Withdraw from the project entirely Be absent from the project during any continuous period of 3 months or more Reduce time devoted to the project by 25 percent or more from the level that was approved at the time of initial competing year award Once approval has been given for a significant change in the level of effort, then all subsequent reductions are measured against the approved, adjusted level. May 2013Time and Effort Reporting16

17. NIH 25% Reduction in Effort Example A PI proposes a change in Committed Effort from 40% to 30%. A 25% reduction will occur, requiring pre-approval from NIH. Calculation: 40% - 30% = 10% 10/40 = 25% Reduction in Committed Effort May 2013Time and Effort Reporting17

18. Red Flags Late or missing T&E Reports Certification by someone without first-hand knowledge Effort reported for non-research projects is not reasonable to cover patient care, administrative or other HH responsibilities. Significant number of revisions to T&E Reports (retro-active management of effort) Projects with Committed Effort but none delivered Significant data inconsistency between T&E Report and other documentation such as: Payroll records Progress reports Time allocated to non-research projects May 2013Time and Effort Reporting18

19. Non-Compliance Fines and Penalties Johns Hopkins University (2004) - $2.6 million settlement Overstated PI effort on federal projects YALE (2008) - $7.6M settlement ($3.8M in actual damages and $3.8M in penalties) Cost transfers for unallowable costs Unsigned effort reports (costs disallowed) No procedures in place to monitor effort expended versus committed May 2013Time and Effort Reporting19

20. Contact Information Any questions or concerns regarding the completion or certification of T&E Reports should be directed to Grants and Contracts. Grants and Contracts Main Line: 860.545.4592 Tammy Weirs, Manager: 860.545.4412 Linda Adams, Administrator: 860.545.5611 Marc Ginnett, Administrator: 860.545.2093 Compliance concerns should be directed to the HHC Office of Compliance, Audit and Privacy (OCAP). Angelo Quaresima, Research Compliance Specialist: 860.972.7065 May 2013Time and Effort Reporting20

21. May 2013Time and Effort Reporting21 Questions?