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MANAGING SPONSORED PROJECTS FINANCIAL COMPLIANCE May 1, 2008 Office of Grants &Contracts Accounting
FINANCIAL COMPLIANCE <ul><li>You Should Understand: </li></ul><ul><li>Key Areas of Risk </li></ul><ul><li>Your Responsibil...
FINANCIAL COMPLIANCE What are the Risks Related to Grant Awards? <ul><li>Misuse of funds (purchasing cards, fraud) </li></...
FINANCIAL COMPLIANCE Why All The Fuss? <ul><li>Because of Potential </li></ul><ul><li>Impact on MUSC </li></ul><ul><ul><li...
FINANCIAL COMPLIANCE Why All The Fuss? <ul><li>Because of Potential </li></ul><ul><li>Impact on You </li></ul><ul><ul><li>...
FINANCIAL COMPLIANCE Who is Responsible? <ul><li>Institution? </li></ul><ul><li>Principal Investigator (PI)? </li></ul><ul...
FINANCIAL COMPLIANCE Who is Responsible? <ul><li>As PI, you: </li></ul><ul><li>Make the budgetary decisions </li></ul><ul>...
FINANCIAL COMPLIANCE Who is Responsible? <ul><li>Tips: </li></ul><ul><li>Always remember that the financial aspects of you...
FINANCIAL COMPLIANCE Training <ul><li>What would your responses to the following questions be? </li></ul><ul><ul><li>What ...
FINANCIAL COMPLIANCE Understanding Direct Costs vs. F&A Costs <ul><li>DIRECT COSTS </li></ul><ul><ul><li>Federal Definitio...
FINANCIAL COMPLIANCE    Avoiding the Pitfalls Allowable/Unallowable Expenditures <ul><li>Know what charges are not applica...
FINANCIAL COMPLIANCE   Avoiding the Pitfalls Cost Transfers <ul><li>Try to avoid having frequent transfers </li></ul><ul><...
FINANCIAL COMPLIANCE   Avoiding the Pitfalls Activity Reporting <ul><li>Be aware of the University’s policies and understa...
FINANCIAL COMPLIANCE Most Common Direct Costs <ul><li>Salaries & Fringe Benefits </li></ul><ul><li>Equipment </li></ul><ul...
FINANCIAL COMPLIANCE Salaries & Fringe <ul><li>Combined Salary </li></ul><ul><li>NIH Salary Cap </li></ul><ul><li>Affiliat...
FINANCIAL COMPLIANCE Equipment <ul><li>Definition  </li></ul><ul><ul><ul><li>Special purpose equipment </li></ul></ul></ul...
FINANCIAL COMPLIANCE Supplies <ul><li>Materials & Supplies </li></ul><ul><ul><li>Expendable items  </li></ul></ul><ul><ul>...
FINANCIAL COMPLIANCE Patient Care Costs <ul><li>Account Code </li></ul><ul><ul><li>Most commonly used chart of accounts </...
FINANCIAL COMPLIANCE Travel <ul><li>Who can travel? </li></ul><ul><li>Contact GCA for further assistance prior to incurrin...
FINANCIAL COMPLIANCE Subrecipient Agreements <ul><li>Definition </li></ul><ul><li>Prior approval </li></ul><ul><li>Applica...
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MANAGING SPONSORED PROJECTS FINANCIAL COMPLIANCE

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Transcript of "MANAGING SPONSORED PROJECTS FINANCIAL COMPLIANCE"

  1. 1. MANAGING SPONSORED PROJECTS FINANCIAL COMPLIANCE May 1, 2008 Office of Grants &Contracts Accounting
  2. 2. FINANCIAL COMPLIANCE <ul><li>You Should Understand: </li></ul><ul><li>Key Areas of Risk </li></ul><ul><li>Your Responsibilities </li></ul><ul><li>Resources and Tools Available </li></ul>
  3. 3. FINANCIAL COMPLIANCE What are the Risks Related to Grant Awards? <ul><li>Misuse of funds (purchasing cards, fraud) </li></ul><ul><li>Improper cost allocation (multiple projects) </li></ul><ul><li>Accelerated expenditures </li></ul><ul><li>Unobligated balances </li></ul><ul><li>Cost transfers </li></ul><ul><li>Restrictions on Notice of Award </li></ul><ul><li>Financial conflict of interest </li></ul><ul><li>Time and effort reporting </li></ul><ul><li>Unallowable costs </li></ul>
  4. 4. FINANCIAL COMPLIANCE Why All The Fuss? <ul><li>Because of Potential </li></ul><ul><li>Impact on MUSC </li></ul><ul><ul><li>Shutdown of Operations </li></ul></ul><ul><ul><li>Fines and Penalties </li></ul></ul><ul><ul><li>Damage to University’s Reputation </li></ul></ul><ul><ul><li>Susceptibility to False Claims Allegations </li></ul></ul>
  5. 5. FINANCIAL COMPLIANCE Why All The Fuss? <ul><li>Because of Potential </li></ul><ul><li>Impact on You </li></ul><ul><ul><li>Loss of PI Status </li></ul></ul><ul><ul><li>Debarment </li></ul></ul><ul><ul><li>Possible Criminal and Civil Charges </li></ul></ul><ul><li>Remember: One of our primary goals in GCA is to safeguard the University and you </li></ul>
  6. 6. FINANCIAL COMPLIANCE Who is Responsible? <ul><li>Institution? </li></ul><ul><li>Principal Investigator (PI)? </li></ul><ul><li>Departmental Administrator? </li></ul><ul><li>Central Administration? </li></ul>
  7. 7. FINANCIAL COMPLIANCE Who is Responsible? <ul><li>As PI, you: </li></ul><ul><li>Make the budgetary decisions </li></ul><ul><li>Approve expenditures </li></ul><ul><li>Should know special terms and conditions </li></ul><ul><li>Approve final Financial Status Reports (FSRs) </li></ul>
  8. 8. FINANCIAL COMPLIANCE Who is Responsible? <ul><li>Tips: </li></ul><ul><li>Always remember that the financial aspects of your grant are just as important as the science </li></ul><ul><li>Don’t ever hesitate to question an expense on your grant </li></ul>
  9. 9. FINANCIAL COMPLIANCE Training <ul><li>What would your responses to the following questions be? </li></ul><ul><ul><li>What training have you attended in the past 18 months? </li></ul></ul><ul><ul><li>Who sponsored this training? </li></ul></ul><ul><ul><li>What training programs are provided by the University? </li></ul></ul><ul><ul><li>Does MUSC have policies and procedures to ensure compliance with federal regulations? </li></ul></ul><ul><li>Make every effort to attend training </li></ul>
  10. 10. FINANCIAL COMPLIANCE Understanding Direct Costs vs. F&A Costs <ul><li>DIRECT COSTS </li></ul><ul><ul><li>Federal Definition (OMB Circular A-21, Section D) </li></ul></ul><ul><li>F&A COSTS </li></ul><ul><ul><li>Federal Definition (OMB Circular A-21, Section E) </li></ul></ul><ul><li>It is a Direct Cost, but is the cost allowable? </li></ul><ul><li>Does the cost meet the following criteria? </li></ul><ul><ul><li>Reasonable </li></ul></ul><ul><ul><li>Allocable </li></ul></ul><ul><ul><li>Allowable </li></ul></ul><ul><ul><li>Consistently Treated </li></ul></ul>
  11. 11. FINANCIAL COMPLIANCE Avoiding the Pitfalls Allowable/Unallowable Expenditures <ul><li>Know what charges are not applicable to your grant </li></ul><ul><li>If you have concerns of allowabilty or allocability question your Departmental Administrators </li></ul><ul><li>Become familiar with costs that can and cannot be charged direct to your grant </li></ul>
  12. 12. FINANCIAL COMPLIANCE Avoiding the Pitfalls Cost Transfers <ul><li>Try to avoid having frequent transfers </li></ul><ul><li>Understand the University’s Cost Transfer Policy </li></ul><ul><li>Be aware of the NIH Cost Transfer Policy </li></ul><ul><li>Question transfers off and onto your grant </li></ul><ul><li>Make sure cost transfers are adequately justified and well documented </li></ul><ul><li>Avoid transfers at the end of a grant spending period </li></ul>
  13. 13. FINANCIAL COMPLIANCE Avoiding the Pitfalls Activity Reporting <ul><li>Be aware of the University’s policies and understand them </li></ul><ul><li>Submit Activity Reports on time </li></ul><ul><li>Be able to reasonably explain how you track the amount of time spent on an award </li></ul><ul><ul><ul><ul><li>By You </li></ul></ul></ul></ul><ul><ul><ul><ul><li>By a Trainee or Post Doc </li></ul></ul></ul></ul><ul><li>Know who your Department Coordinator is </li></ul><ul><li>Understand how activity is reported, to whom, and how often </li></ul><ul><li>Understand how your activity is approved </li></ul><ul><li>Know who maintains the Activity Reports </li></ul><ul><li>Make sure that you account for all of your activity </li></ul>
  14. 14. FINANCIAL COMPLIANCE Most Common Direct Costs <ul><li>Salaries & Fringe Benefits </li></ul><ul><li>Equipment </li></ul><ul><li>Supplies </li></ul><ul><li>Patient Care Cost </li></ul><ul><li>Travel </li></ul><ul><li>Subrecipient Agreements </li></ul>
  15. 15. FINANCIAL COMPLIANCE Salaries & Fringe <ul><li>Combined Salary </li></ul><ul><li>NIH Salary Cap </li></ul><ul><li>Affiliate Salary Worksheet </li></ul><ul><li>(Affiliate Salary - Policy/Procedure 4-3.07) </li></ul><ul><li>Fringe Benefits – rates negotiated only for grants </li></ul><ul><li>MUSC Online Activity Reporting https:// appserve.musc.edu /effort </li></ul>
  16. 16. FINANCIAL COMPLIANCE Equipment <ul><li>Definition </li></ul><ul><ul><ul><li>Special purpose equipment </li></ul></ul></ul><ul><ul><ul><li>General purpose equipment </li></ul></ul></ul><ul><li>Excluded from the F&A Calculation on federal awards </li></ul><ul><li>Rebudgeting may require prior approval from the sponsor </li></ul>
  17. 17. FINANCIAL COMPLIANCE Supplies <ul><li>Materials & Supplies </li></ul><ul><ul><li>Expendable items </li></ul></ul><ul><ul><li>Medical/scientific/laboratory supplies </li></ul></ul><ul><ul><li>Equipment under $5000 or a useful life > 1 yr. </li></ul></ul><ul><li>Office Supplies </li></ul><ul><ul><li>Normally unallowable as a direct cost on federal awards </li></ul></ul>
  18. 18. FINANCIAL COMPLIANCE Patient Care Costs <ul><li>Account Code </li></ul><ul><ul><li>Most commonly used chart of accounts </li></ul></ul><ul><li>Inpatient and outpatient expenses </li></ul><ul><li>Rebudgeting </li></ul><ul><li>Excluded from F&A Cost Calculation for Federal Awards </li></ul>
  19. 19. FINANCIAL COMPLIANCE Travel <ul><li>Who can travel? </li></ul><ul><li>Contact GCA for further assistance prior to incurring travel expenditures. </li></ul><ul><li>Travel expenses incurred by consultants & private entities are subject to the Federal Travel Regulations http:// www.gsa.gov/Portal/gsa/ep/contentView.do?contentId =17943&contentType=GSA_BASIC </li></ul>
  20. 20. FINANCIAL COMPLIANCE Subrecipient Agreements <ul><li>Definition </li></ul><ul><li>Prior approval </li></ul><ul><li>Applicable F&A </li></ul><ul><li>Subrecipient invoice approvals </li></ul>
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