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DS2 - Faculty Preparation

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Title: DS2 - Faculty Preparation


1
DS2 - Faculty Preparation
  • Overview of UGA Policies and Procedures in
    complying with OMB Circular A-21

2
DS2 - General Information
  • Disclosure Web Site
  • www.busfin.uga.edu/disclosure
  • All Policies and Procedures related to the
    University Disclosure Statement may be found
    under the Disclosure Policies and Disclosure
    Procedure links
  • Policies are effective January 1, 2006
  • Substantial Changes must be approved by our
    Cognizant Federal Agency

3
DS2 - Meeting Agenda
  • What is a DS2?
  • How was the UGA DS2 developed?
  • Policy and Procedures - overview
  • Additional References
  • Conclusion
  • Questions

4
What is a DS2?
  • Documents and discloses University cost
    accounting practices
  • Required to be submitted to cognizant agency and
    cognizant audit agency.
  • Policies and procedures, instructions, and
    guidelines for individual investigators,
    department heads, and administrators need to be
    made available because it is their responsibility
    to understand and know them.
  • Provides Guidelines for charging costs to
    sponsored awards
  • Defines University direct costing policies and
    procedures
  • Cost-sharing policies
  • Time and effort reporting policies and procedures
  • Policies on Service Centers

5
DS2 How was it Developed
  • Three working group committees were formed
    comprised of College and Departmental Business
    Managers and Faculty representatives
  • Steering Committee comprised of
    Associate/Assistant Deans, Department Head, and
    Center Director representatives

6
DS2 - Policies
  • New Policies
  • Cost Transfer
  • Program Income
  • Service Center
  • Existing Policies Revised
  • Cost Share
  • Direct Cost
  • Personnel Activity Report

7
DS2 New PoliciesCost Transfers
  • Cost Transfer movement of expense(s) between
    two different university account numbers
  • Charges should be moved within 90 days of initial
    charge
  • Charges moved after 90 days require PI signature
  • All transfers must have adequate
    explanation/justification
  • No transfers allowed to a restricted account if
    expense is more than a year old

8
DS2 New PoliciesCost Transfers
  • Appropriate Justification Includes
  • When the error, or need for a transfer was
    discovered
  • What the charge was for
  • Why the charge was identified with a different
    project originally
  • How the charge relates to the project that it is
    being transferred to

9
DS2 New PoliciesCost Transfers
  • Conditions for not Allowing Cost Transfers
  • No benefit to the project can be demonstrated
  • Cost overruns are being transferred to an account
    with budget available
  • Charges are being parked on one account with
    the intention of being moved to another

10
DS2 New PoliciesProgram Income
  • Program Income is gross income earned by the
    recipient that is directly generated by a
    supported activity or earned as a result of the
    award.
  • Principal Investigator must
  • Identify potential sources at proposal stage,
    note on transmittal and application
  • Plan for use, prepare budget for program income
    accounts
  • Verify program income on reports
  • Address account balance issues at project
    termination

11
DS2 New PoliciesProgram Income
  • Federal Sponsors
  • Use program income funds before sponsor funds.
  • If funds remain in the project or program income
    account after the project has terminated,
    balances will revert to sponsor.
  • If the PI wishes to retain these funds, he or she
    must write a letter to the sponsor requesting to
    use these funds, and outlining a plan for their
    use.
  • Letter must be sent to OSP for endorsement and
    forwarding to the sponsors for approval.
  • Non-Federal Sponsors
  • In many cases, the sponsor does not have an
    established program income policy. If the sponsor
    is silent on this issue, the income is not
    reportable and is handled as a departmental sale
    or recharge activity.

12
DS2 Existing Policies-RevisedCost Share
  • The policy of the University of Georgia is to
    limit its cost sharing on externally funded
    projects to the amount specifically mandated in
    the application guidelines of the sponsor.
  • The University of Georgia will support committed
    cost share that is either voluntary or mandatory
    by the sponsor when

13
DS2 Existing Policies-RevisedCost Share
  • All cost shared amounts are specified on the
    Office of Sponsored Programs Transmittal Form,
    and
  • Each cost shared amount is approved on the OSP
    Transmittal Form by the relevant dean, director,
    or department head. Approval signatures are
    binding and indicate a willingness to provide
    cost share resources in support of the proposed
    project.

14
DS2 Existing Policies-RevisedCost Share
  • Example of committed cost sharing and how it
    should be tracked
  • PI stated in proposal narrative that they would
    spend 10 of their time on project. PIs monthly
    academic salary is 7,000.

Cost Share Not Tracked Cost Share Not Tracked Cost Share Not Tracked Cost Share Tracked Cost Share Tracked Cost Share Tracked
(PAR not issued) (PAR not issued) (PAR not issued) (PAR required) (PAR required) (PAR required)
Type of Account Percent Effort Salary Percent Effort Salary
Instruction (1011GH) - state Instruction (1011GH) - state 25 1,750 25 1,750
Dept. research (1025GR) - state Dept. research (1025GR) - state 75 5,250 65 4,550
Cost Share (1021CR) - state Cost Share (1021CR) - state     10 700
100 7,000 100 7,000
15
DS2 Existing Policies-RevisedCost Share
  • Alternative
  • PI stated in proposal narrative that they would
    spend 10 of their time on project and asks
    sponsor to fund this effort. PIs monthly
    academic salary is 7,000.

PAR not issued PAR not issued PAR not issued PAR required PAR required PAR required
Type of Account Percent Effort Salary Percent Effort Salary
Instruction (1011GH) - state Instruction (1011GH) - state 25 1,750 25 1,750
Dept. research (1025GR) - state Dept. research (1025GR) - state 75 5,250 65 4,550
Sponsored research (1021RR) - grant Sponsored research (1021RR) - grant     10 700
100 7,000 100 7,000
16
DS2 Existing Policies-RevisedCost Share
  • Cautionary Notes
  • Cost share commitments can be stated in several
    places within a proposal.
  • When faculty time is contributed as cost share in
    support of a project, it is expected that
    budgeted research time be utilized for cost share
    before instructional time is considered. Whenever
    cost share involves instructional time, the
    faculty member's department head and/or dean must
    be notified so that approval can be obtained.
  • In all instances where cost sharing is described,
    the institution is committed to account for these
    expenditures. The budgetary unit of record is
    responsible for documenting and tracking all
    commitments made on a project, whether made by
    that department or not, unless subaccounts are
    established so that the responsibility can flow
    down to other units.

17
DS2 Existing Policies-RevisedCost Share
  • Principal Investigator
  • Carefully consider cost share before including in
    proposal
  • Identify source of cost share funds and ensure
    they are not federal (unless authorized by
    statute)
  • Monitor budget and expenditures on cost share
    account
  • Ensure accuracy of cost sharing/matching

18
DS2 Existing Policies-RevisedDirect Cost Policy
  • Major Changes
  • More specific in order to address consistency
  • Determination factors defined Allowable,
    Allocable, Reasonable
  • Determination Strategy
  • Treatment of direct and facilities and
    administrative (indirect) costs
  • Unallowable Costs

19
DS2 Existing Policies-RevisedDirect Cost Policy
  • Principal Investigator
  • Development of proposal budget, and financial
    management of project, consistent with UGAs
    Direct Cost Policy Procedures
  • Allocation of costs to benefiting projects
  • Review of project budgets and actual costs to
    ensure timely correction of any errors

20
DS2 Existing Policies-RevisedDirect Cost Policy
  • Examples of Problematic Costs
  • Administrative and Clerical Costs
  • Cell phones
  • Routine Postage
  • Individual Professional Memberships
  • General Office Supplies and Equipment
  • Printer Toner, Copy Paper
  • Computers (unless scientifically justified)
  • PDAs/Blackberries
  • Submission of technical/final reports

21
DS2 Existing Policies-RevisedDirect Cost Policy
  • Example of appropriate use of different funds
  • 1011GH Instruction salaries materials
  • 1025GR Dept. or general research salaries
    materials
  • 1011GJ Dept. admin. salaries, general office
    supplies, paper, basic telephone, routine
    postage, computers
  • 102xAR Same as GJ, but another funding source
    or use to supplement research costs
  • 1021RR Organized research salaries materials
    -- charges that directly benefit aim of project

22
DS2 Existing Policies-RevisedDirect Cost Policy
  • Major Projects and Exceptions
  • - Modular Grants rarely qualify for major project
    status.
  • - To qualify for a Major Project you must apply -
  • Large , complex programs, such as general
    clinical research centers, primate centers,
    program projects, and projects requiring managing
    teams of investigators from other institutions.
  • Projects which involve extensive data
    accumulation, analysis and entry, surveying,
    tabulation cataloging, searching literature, and
    reporting, such as epidemiological studies,
    clinical trials, and retrospective clinical
    records studies.
  • Projects that require making travel and meeting
    arrangements for large numbers of participants,
    e.g. conferences or seminars.

23
DS2 Existing Policies-RevisedDirect Cost Policy
  • Major Projects and Exceptions (Continued)
  • Projects where the principal focus is the
    preparation and production of manuals and large
    reports, books and monographs
  • Projects that are geographically inaccessible to
    normal departmental administrative services, such
    as seagoing research vessels, radio astronomy
    projects, and other research field sites that are
    remote from the campus
  • Individual projects requiring project-specific
    database management individualized graphics or
    manuscript presentation human or animal
    protocol IRB or multi-faceted coordination.
  • Extraordinary and extensive administrative
    support, significantly greater than the routine
    level provided by academic department staff may
    be budgeted and charged to sponsored projects
    including research data gathering, computer
    programming, research training,developing
    materials for presentations, etc...

24
DS2 Existing Policies-Revised Personnel
Activity Reports (PARs)
  • OMB Circular A-21 (Section J.10) contains
    requirements for procedures and documentation to
    support the distribution of salaries and wages
    charged directly to an award or through
    Facilities and Administrative (indirect)
    activities.
  • The employees salary must follow consistently
    applied institutional policies regarding
    compensation and be allocated through an official
    payroll system that ties with the financial
    records of the institution.

25
DS2 Existing Policies-Revised Personnel
Activity Reports (PARs)
  • The payroll distribution must reasonably reflect
    the activity for which the employee is
    compensated.
  • The method must recognize the principle of
    after-the-fact confirmation so that costs
    distributed represent actual costs.
  • The main objective of A-21 is verification that
    compensation charged is appropriate to the
    activity performed.

26
DS2 Existing Policies-Revised Personnel
Activity Reports (PARs)
  • Our verification method is in the form of
    Personnel Activity Reports (PARs).
  • PARs are used to confirm that the distribution of
    activity represents a reasonable estimate of the
    work performed by the employee during the period.
  • University wide, only 5 of PARs are adjusted.
    For the majority of employees, the review and
    certification of a PAR is not a burdensome task.

27
Personnel Activity Reports (PARs)Who receives a
PAR?
  • In any of the following situations an employee
    will receive a PAR
  • 1. A portion of their salary charged directly
    to restricted accounts or cost sharing accounts.
  • 2. A portion of their salary charged to a major
    function and an indirect cost activity.
  • 3. A portion of their salary charged to more
    than one indirect cost activity.

28
Personnel Activity Reports (PARs) How do I
verify and submit a PAR?
  • A PAR will be generated for each pay period for
    which an employee is paid.
  • To confirm that the distribution of activity
    represents a reasonable estimate of the work
    performed by the employee during the period, each
    PAR must be reviewed for accuracy and approved by
    the employee or by a responsible official having
    first-hand knowledge of the work performed.

29
Personnel Activity Reports (PARs)How do I verify
and submit an e-PAR?
  • When PARs are generated, an email notification
    will be sent to employees registered email
    address and to their home departmental
    administrator.
  • The electronic PAR system can be accessed at
    https//webapps.ais.uga.edu/PCTE/
  • You will log on to the electronic PAR system
    using your MyID and password.

30
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31
Personnel Activity Reports (PARs)How do I verify
and submit an e-PAR?
  • If the PAR reflects accurately the time expended
    on a project tracked by a University account
    number, you will check the Check here to return
    this PAR without any changes check box.
  • Next, you will click the Save and Submit button
    to transmit the approved document to the
    Accounting Department.

32
Personnel Activity Reports (PARs)How do I verify
and submit an e-PAR?
  • In those situations where the current
    distribution does not reflect the time actually
    expended on a project for the period covered by
    the PAR, your department administrator should be
    notified of the necessary changes.
  • Your department administrator will be able to
    enter the changes and submit the revised PAR to
    the Accounting Department.

33
DS2 New Policies Service Centers
  • A departmental sales unit established for the
    purpose of providing goods and services to
    university departments, and only incidentally to
    customers outside the university.
  • Service centers offer goods and services that are
    unique, benefit the effectiveness of the
    University when conveniently available, may
    require special controls, are subject to federal
    and/or state regulations, or are not readily
    available from external sources.
  • Service Centers that generate revenues greater
    than 100,000 per year need to prepare business
    plan.

34
DS2 New Policies Service Centers Billing Rates
  • Departments are responsible for the development
    and review of Service Center billing rates.
  • The billing rate should be calculated to break
    even at the end of a fiscal year (accounting
    period).
  • The billing rate should only include costs to be
    recovered (no profit margins).
  • The same billing rate must be used to charge all
    UGA accounts (internal customers).

35
DS2 - Policy Summary
  • Effective January 1, 2006
  • Cost Transfers (JVs)
  • Must be performed within 90 days of charge.
    Otherwise will require PI signature
  • Must have adequate explanation/justification
  • No transfers to a restricted account more than a
    year old
  • Program Income
  • Used before sponsored funds or must have approved
    authorization
  • Must have approval from sponsor for UGA to retain
    any funds
  • Cost-Share
  • Try to limit and specify on Sponsored Program
    Transmittal Form

36
DS2 - Policy Summary
  • Direct Cost
  • Can not routinely charge cell phones, routine
    postage, membership dues, general office supplies
    and equipment to sponsored awards (exceptions may
    be granted by justification through Sponsored
    Programs. General Federal Funded Research
    projects seldom qualify for such an exception)
  • PARs
  • Electronic PARs will be implemented by July 1,
    2006
  • Everyone will be able to certify with no changes
  • Departmental administrators will be only ones
    that can make changes
  • Service Centers
  • Departments must develop billing rates
  • Must break-even (no profit)
  • Must charge same rate to all UGA customers

37
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38
DS2 Additional Training
  • Faculty Preparation Course will be offered at
    Training and Development on an ongoing basis.
  • Business Manager, Departmental Administrators and
    Office Manager training will be offered either on
    request and/or at Training and Development (Six
    Courses lasting approx. two hours per course).

39
DS2-Faculty Presentation
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