The new time and effort reporting requirements under the OMB Uniform Guidance abandoned prescriptive requirements for how institutions report effort in favor of promoting strong internal controls. Recipients of federal funds have should have adequate checks and balances in place to ensure that the amount of effort charged to a federal award (or used as cost share) matches actual effort spent on funded activities. Moreover, award recipients must provide “…reasonable assurance that charges are accurate, allowable, and properly allocated,” (2CFR 200.420(i)(1)(i)).

There are a number of ways recipients of federal funds can demonstrate adequate internal controls, some of which include:

• Written policies around effort reporting are clear, communicated, and readily available (see the CSU effort policy and FAQs);
• Job descriptions are clear on reporting functions and there is an appropriate segregation of duties for reviewing and approving grant expenditures;
• Training is provided on all aspects of effort reporting, to PIs and administrators; and
• Systems are in place to reduce risk of data entry errors and to allow for identification of federal sponsored transactions.

The takeaway here is that internal controls must be in place over the lifecycle of the award; from proposal, through expenditure and reporting, not just during closeout. Effort reporting is a shared, lifecycle responsibility, and at CSU there are a number of internal controls in place along the lifecycle, some of which are described below.

CSU Internal Controls over the Lifecycle

DURING PROPOSAL SUBMISSION

Proposed salary should be calculated based on appointment type, considering all commitments, and should not exceed 100% effort.  At CSU, using the budget feature in KR PD (Kuali Research Proposal Development) helps to ensure current salary data is being used. Routing the budget in KR ensures that unit leadership (Chairs and Deans) are reviewing and approving commitments, salary, and appointment types for key personnel and that cost sharing commitments are approved upfront.

DURING AWARD SETUP

Project information is provided to accounting to create the sponsored project in KFS (Kuali Financial System). In addition to 53 accounts, companion accounts are established to separately track cost sharing commitments and program income. PIs and their administrators should double check the setup of 53 and associated accounts prior to beginning work and should notify OSP if corrections need to be made.

DURING ACCOUNT MANAGEMENT

PIs and associated RAs can view award/account information and current KFS activity by going through MyRAM. PIs and their unit administrators can use the reports in ecrt (Effort Certification and Reporting Technology) to monitor effort charged on grants. PIs attest quarterly (in conjunction with quarterly review of effort/work performed) that expenditures are reasonable, allocable, and allowable to the project.

In addition to quarterly reviews, there are best practices and procedures in place for changes in salary distributions (PPDAs) that ensure appropriate justifications are in place when transfers are necessary.

DURING EFFORT REPORTING

CSU’s use of ecrt allows PIs and their administrators to view salary expenditures in terms of percentages of effort each quarter. Pre-review of effort percentages in ecrt by unit administrators adds an additional level of checks-and-balances to ensure effort has been appropriately allocated on sponsored projects. With the introduction of ecrt, CSU’s effort reporting policy and FAQs were updated, widely distributed and are readily available on the CSU website.

DURING PROJECT CLOSEOUT

Financial managers are made aware of closeout requirements and closeout reminders are sent at least 90 days prior to project end date. During this time, PIs and associated administrators should review account transactions for accuracy, allowability, and allocation and notify OSP if there are issues. Projects are closed after a review of all transactions, after all project-related expenses have been posted, and after unallowable charges and over expenditures have been removed.

No matter when you touch a sponsored award, be it pre-award or post-award, in a department, college or central office, it’s imperative to understand the requirements for documenting and reporting personnel costs. You are an integral part of the control system necessary to ensure compliance with federal regulations around effort reporting.