OMB Circulars and Beyond Nancy Duncan, Award Analysis Supervisor
Sponsored Projects Administration Slide 2 Audience This course is
intended for department administrative staffincluding department
administrators, division managers, department fiscal managers,
department effort coordinators, etc. Slide 3 Introduction The
federal Office of Management and Budget (OMB) has issued a number
of circulars to define the principles and standards for sponsored
projects funded by federal agencies All three of these Circulars
are instructions directed to the agencies but they must still be
followed by recipient institutions Slide 4 Introduction This
session will examine the three circulars most significant to
sponsored projects at OHSU: A-21 A-110 (2 CFR Part 215) A-133 The
Code of Federal Regulations (CFR) spells out each agencys
implementation of these circulars Slide 5 Introduction A-21 defines
the cost principles applicable to grants and contracts at
educational institutions A-110 sets forth standards for consistency
among federal agencies in the administration of grants to and
agreements with institutions of higher education, hospitals, and
other non-profits A-133 sets forth standards for consistency in
audits of organizations spending federal awards Slide 6
Introduction Sponsored Projects Administration (SPA) website
provides a link to the complete text of each OMB Circular:
http://www.ohsu.edu/research/rda/spa/fed eral.shtml
http://www.ohsu.edu/research/rda/spa/fed eral.shtml Slide 7 A-21
Topics Cost Accounting Standards (CAS) Direct vs. Indirect
(F&A) Costs Allowable vs. Unallowable Costs Effort Reporting
Slide 8 A-21 Topics Cost Accounting Standards Consistency in
estimating, accumulating, and reporting costs Consistency in
allocating costs incurred for the same purpose Accounting for
unallowable costs Cost accounting period (fiscal year) Slide 9 A-21
Topics Direct Costs are costs that can be directly associated with
a particular sponsored project, an instructional activity, or any
other institutional activity Examples of Direct Costs: Principal
Investigator salary Lab supplies Scientific equipment Slide 10 A-21
Topics Indirect (Facilities & Administrative) Costs are costs
that are incurred for common or joint objectives and cannot be
specifically identified with a particular sponsored project,
instructional activity, or other institutional activity Examples of
Indirect Costs: Libraries Maintenance Research Administration Slide
11 A-21 Topics Allowable Costs Must be reasonable Must be allocable
Must be treated consistently Must conform to any limitation or
exclusion Prudent person test Slide 12 A-21 Topics Section J
specifies which costs are allowable and unallowable as both direct
and indirect costs Examples of Allowable Costs Equipment,
Professional Services, Transportation Examples of Unallowable Costs
Alcohol, Entertainment, Lobbying, Marketing Slide 13 A-21 Topics
Unallowable Costs Case Study Slide 14 A-21 Topics Time and Effort
Reporting The purpose of an effort reporting system is to provide a
reasonable basis for distributing salary charges among direct and
indirect activities OHSU uses a semi-annual, after-the-fact effort
reporting system Slide 15 A-21 Topics Effort Reporting Case Study
Slide 16 A-110 Overview 2 CFR Part 215 (formerly OMB Circular A-
110) Uniform Administrative Requirements for Grants &
Agreements This circular sets forth standards for obtaining
consistency and uniformity among Federal agencies in the
administration of grants to and agreements with institutions of
higher education, hospitals, and other non-profit organizations.
Slide 17 A-110 Topics Financial Management Systems Cost Sharing
Program Income Reports and Records Termination and Enforcement
Close-Out Procedures Slide 18 A-110 Topics OHSU is accountable to
sponsoring agencies and must demonstrate that appropriate financial
management systems are in place A-110 requires institutions
receiving federal assistance to maintain [e]ffective control over
and accountability for all funds, property and other assets... and
assure they are used solely for authorized purposes. (Subpart
C.21.b.3) Slide 19 A-110 Topics Cost Sharing is the portion of
project costs not borne by the Federal Government Cost Sharing can
include: Cash (from recipient) Academic year effort (from
recipient) Third party In-Kind Contributions (from outside the
recipient organization) Slide 20 A-110 Topics Cost Sharing must be
more than a token amount (ie, typically more than 1% of project
costs) Cost Sharing represents institutional commitment to the
project Slide 21 A-110 Topics Mandatory Cost Sharing is required by
the sponsor as a condition of making the award Voluntary Cost
Sharing is not required by the sponsor but may become legally
binding as a commitment reflected in the proposed budget Committed
(eg, over salary cap) Uncommitted (not tracked by OHSU) Slide 22
A-110 Topics Acceptable Cost Sharing must be: Verifiable and
documented in recipient records Not included as matching for any
other federal projects, nor paid from other federal awards
Necessary and reasonable Allowable under applicable cost principles
Appropriate to all OMB Circular A-110 provisions Slide 23 A-110
Topics Cost Sharing Case Study Slide 24 A-110 Topics Program Income
applies to funds earned during a project period Program Income
includes Registration fees for a training or conference award
Products or materials purchased on an award and sold after research
has been conducted Sale of information produced or acquired under
the award Slide 25 A-110 Topics Program Income may be: Added to
funds committed to the project Deducted from total project
allowable costs Applied to non-federal share of project costs
Recipient has no obligation to the Federal Government for funds
earned after the project period unless the agencys regulations or
terms and conditions provide otherwise Slide 26 A-110 Topics
Program Income Case Study Slide 27 A-110 Topics Property Management
applies to property purchased under Federal awards, such as land,
structures, equipment Exempt property is that on which the title
vests with the recipient upon acquisition with no further
obligations Property management also applies to supplies Slide 28
A-110 Topics Property Management systems must: Conduct a physical
inventory every two years Safeguard against damage, loss, and theft
Provide adequate maintenance Maintain insurance Sell competitively
at highest return, when authorized Slide 29 A-110 Topics Reports
& Records: A-110 sets forth procedures for monitoring and
reporting financial and program performance and the required
reporting forms, including requirements for record retention Slide
30 A-110 Topics Award recipients are responsible for managing and
monitoring each project, program, function and activity supported
by the award Award recipients are responsible for ensuring that
sub-recipients have also met all audit requirements Slide 31 A-110
Topics Technical reports must be completed not more than quarterly
and not less than annually Reports must contain: Comparison of
actual accomplishments with set goals for the period If applicable,
reasons that goals were not met Explanation for any cost over-runs
or high unit costs Slide 32 A-110 Topics Award recipients must
notify the awarding agency whenever events occur that have a
significant impact on the project or program, or when problems,
delays or adverse conditions materially impair the ability to
attain program objectives. Slide 33 A-110 Topics Financial Status
Report (FSR) is required on any federally sponsored project SPA
submits financial reports to sponsors SPA Senior Financial Analyst
sends copies of reports to departments for review (eg, End Date
Memo, etc) Slide 34 A-110 Topics Financial records, supporting
documents, statistical records and all other records must be
retained for three years from the date of final report, except
when: Litigation requires retention until matters have been
resolved Records are transferred to the agency, in which case
retention requirements end Other record retention requirements
apply Slide 35 A-110 Topics With agency approval, copies can be
substituted for original records Electronically imaged records may
be substituted for original records provided the institution
establishes appropriate procedures Slide 36 A-110 Topics Access to
records is allowed to the agency, the inspector general and the
comptroller general Agencies may not limit public access to the
recipients records without justification Slide 37 A-110 Topics
Records Retention Case Study Slide 38 A-110 Topics Types of Award
Termination: By the awarding agency By the awarding agency with
recipient consent By the recipient Types of Enforcement: Remedies
for non-compliance Hearings and appeals Suspension and termination
Debarment Slide 39 A-110 Topics Close-Out Requirements All reports
submitted within 90 days All obligations liquidated within 90 days
Prompt payment by awarding agency Recipient refund of unobligated
cash advances Accounting for real and personal property Agency
right to recover disallowances Slide 40 A-133 Overview Effective
July 1, 1992 (revised June 24, 1997), A-133 sets forth standards
for obtaining consistency and uniformity among Federal agencies for
the audit of non-profit organizations expending Federal awards
A-133 requires an annual external audit of all non-federal entities
expending $500,000 or more annually in Federal funds Slide 41 A-133
Overview A-133 defines the requirements of an audit and explains
the responsibilities of the institution, the agency and the auditor
A sample of Federal awards and their direct cost transactions is
selected and examined to determine if expenditures and procedures
were appropriate Slide 42 A-133 Topics At OHSU, departments become
involved in annual A-133 audits when SPA requires information on
source documentation Slide 43 A-133 Topics Audit Case Study Slide
44 Summary This course has examined OMB circulars A-21, A-110, and
A-133 Understanding these federal circulars will help ensure proper
stewardship of federal funds Slide 45 For More Information Come to
other Post-award Education Program courses Visit the Sponsored
Projects Administration website:
http://www.ohsu.edu/research/rda/spa/
http://www.ohsu.edu/research/rda/spa/ Contact SPA with questions or
concerns about these and other award management issues Slide 46 OMB
Circulars Questions?
