instructor: tim quigg associate chair for administration and finance computer science department,...

Instructor: Tim QuiggAssociate Chair for Administration and FinanceComputer Science Department, UNC-Chapel Hill

[email protected] www.cs.unc.edu/~quigg

SRA International: Quebec CityOctober 15, 2006

WS27: Two Necessary Skills for

Successful Departmental Administration:

Leading People and Managing Money

© Copyright 2006 Timothy L. Quigg All Rights Reserved

mailto:[email protected]

http://www.cs.unc.edu/~quigg

Two Necessary Skills

Leading People


What is the number one reason why people leave

jobs?

Bad Bosses!


People accept jobs for many reasons:

Salary

Benefits

Reputation of Organization

Work opportunity

Challenge

These things attract people to a job/organization!


But the analysis of hundreds of thousands of exit interviews/questionnaires shows the singular importance of the immediate supervisor in determining employee morale, productivity and longevity!Bottom line: People may come for the job (package), but how long they stay is directly correlated with the quality of the relationship with their immediate supervisor.


Common Complaints “He’s always looking over my

shoulder and micromanaging everything I do.”

“She never listens to me.”

“He loves to play games – always trying to show who is the boss.”

“She is always taking credit for my work.”

“He’s not a bad person. He just isn’t a manager.”

“I just don’t think she likes me.”


There is no “one size fits all” model of management/supervision


Catalyst – an agent that speeds up the reaction between two substances to create the desired end product.

Catalyst –


Catalyst – a useful metaphor to understand the primary role of the supervisor.

A supervisor is an agent that “speeds up the reaction” between people, resources and ideas to create the desired end product.

BUT HOW?


Three Basic Tasks of Supervision

1. Set clear performance expectations

2. Motivate performance

3. Evaluate performance



Common complaint – “I didn’t know she wanted me to do that.”

Focus on outcomes

Define metrics




2. Motivate Performance Be positive, focus on strengths but Provide input - suggestions Expect progress reports Redirect when necessary

Help employees to know you want them to succeed!




No surprises No changes in measurement Don’t “sugar-coat”


2. Motivate Performance

3. Evaluate Performance Honest - Fair




2. Motivate performance

3. Evaluate performance


Catalyst Theory of Management

Suggests an Appropriate and

Active Role for Managers.

Effective Managers are not

passive, rather they work to

create desired outcomes.


Reward People For Solving Problems Without Coming To See You First!

Unconventional Weekly Staff Meetings Agenda – “The Problems You Faced

And The Decisions You Made And, If You Got Help, Who Helped You.”

Builds A Team That Works Together!

Harvard Business Review Case Study: MacGregor

McGregor Played A Lot Of Golf!


Failure–Tolerant Organizations Encourage Intelligent Risk Taking View Failure As A Pre-Requisite For Invention View Failures As Outcomes To Be Examined,

Understood, And Built Upon Focus On Increasing Their Organization’s

Intellectual Capital Create A Culture Of Collaboration Rather Than

Competition.Richard Farson and Ralph Keyes

The Failure-Tolerant Leader


Peter Doherty, 1996 Nobel Laureate in Medicine (specificity of cell

mediated immune defense)

“A Good Researcher Failed Every Time But The Last One.”


Guiding Principles to Remember: Failure is not an accident Neither is success And feedback is the foundation of

success Take notice of feedback in all its

forms Don’t wait for feedback to come to

you – seek it! Put it in a “Curiosity Frame” – ask

yourself how you can use it to avoid failures or repeat successes


One definition of insanity:

“Doing the same thing over and over and expecting a different

outcome!”


“If what you are doing isn’t working, maybe you

should try something different.”

PROBLEM: Sometimes managers don’t know its not working because they get limited feedback!


What is 360° Feedback? Highly effective system used to

enhance employee development Used by over 90% of Fortune 500

companies Anonymous – increases chance for

honest feedback Addition to, not a replacement of,

institutions performance management system

What makes up a 360 Review?


Why is 360 Valuable to You

Identifies your strengths and weaknesses from the perspective of others.

Improves your productivity and work relationships with those around you.

Improves workplace morale. Provides a means to identify leadership

competencies that need improvement. Provides an opportunity for self

reflection.


JOHARI WINDOW What others know

about us

What others don’t know about us

What we know about ourselves

1. COMMON KNOWLEDGE 2. SECRETS

What we don’t know about ourselves

3. BLIND SPOTS 4. UNKNOWN

Opportunity for Self Reflection

Comments:


“Learning from feedback means you are more likely to be flexible rather than

rigid in your dealings with yourself and others.


“A Team Is A Small Number Of People With Complementary Skills Who Are Committed To A Common Purpose, Set Of Performance Goals, And Approach For Which They Hold Themselves Mutually Accountable.”

Jon R. Katzenbach And Douglas K. Smith

The Discipline Of Teams


DANGER – “One Best Way” Approach

Frederic Taylor: time-and-motion studies

Madelaine Hunter: seven basic components of an effective lesson plan

Expert Systems


Remember, unique people with different combinations of knowledge, skill, experience and talent will determine their own way to achieve the desired outcomes!

Reminder: Some lab or experimental work requires closely following certain rules to insure safety, human subject protection, or research integrity.


What Do We Mean By Talent?

Conventional wisdom – rare ability pertaining to sports or the arts!


What Do We Mean By Talent?

Myth – with enough hard

work, we can

accomplish anything!

X X


What We Have Learned From Neuro-Science

synaptic connections form by age 3

strong ones grow/weak ones wither away

may be genetics or Darwinian pruning

by mid-teens – unique set of synapses (about half the number as at age 3)

these synapses define our talents!


Simply put – the behaviors you find yourself doing most often are your talents.

“A Recurring Pattern Of Thought, Feeling Or Behavior That Can Be Productively Applied.”

Marcus Buckingham & Curt Coffman

First, Break All The Rules

Talents Can Be Defined As


1. Recognize that people are unique

We are a blend of skills, knowledge, experience and talents!

Characteristics of Successful Managers:



2. Treat people differently

Figure out what motivates each person and devise a system of

appropriate rewards!




2. Treat people differently3. Manage around a weakness



Remember the 3 basic tasks of supervision? Set expectations Motivate performance Evaluate performance

If you have an otherwise good employee who consistently performs below expectations in one aspect of his job, what should you do?

Are expectations clear? Does she need certain tools? Am I using the right motivation technique? Is the problem a lack of education/skill? If none of these, then the weakness may be a

lack of talent?


If the problem is a lack of talent:

Accept that you “can’t teach talent”

and

Try to find a way to make the non-talent become irrelevant by managing around it!


Ways to Manage Around a Lack of Talent

1. Devise a support system 150 million Americans need eye

glasses Poor speller – get spellchecker Forget appointments – computer

reminders Story of mentally handicapped worker

• Cooking chicken at fast food restaurant• Goal – cook 6 at a time• Problem – couldn’t count• Package chicken 6 per container

GOAL – Make the non-talent irrelevant!


1. Devise a support system2. Find a complementary partner

Most people are good at some things and bad at others

Most jobs require unrealistic combinations of talents

Goal – find a partnership that is well-rounded when the individuals aren’t



1. Devise a support system2. Find a complementary partner3. Find an alternative role

Sometimes a person just isn’t right for the job but

Sometimes you can move tasks around to better align job assignments with individual talents.



Employee Motivation is Based Upon:

MOTIVATION

A= Does My Job Contribute To My Personal Goals?

A

B= Am I Confident In My Abilities To Do My Job?

B

C= If I Do A Great Job, Will I Be Recognized And Rewarded?

C


Key To Success in Management

Recognize you are a unique person who has management responsibilities

Understand your talents

Integrate these insights/approaches into your own style

There is no “one size fits all” model of management


1) Delegation

You have been asked to review a collaboration agreement that must go out tomorrow but you are in the middle of finalizing the laboratory budget you promised to give to your supervisor by tomorrow at noon. It is your birthday today and a big party is planned for you this evening. There is only one other person you can give any one of these jobs to in your lab. She is in the middle of an important project and you have already spoken to her about the importance of submitting it to you on time. What do you do?


2) Evaluating Performance

Three months ago you hired a new lab tech, and he is not working out as well as you expected. He started out fine but he has called in sick the last two Mondays and has had to leave early on a number of days. You want to schedule a meeting with him to review his performance but feel a bit reluctant to do so because he is such a nice person and you do not want to antagonize him. What you do not realize is that he has a very sick parent to care for.


3) Scientists and the Human Resource

Dr. Roy, your institution’s most senior research scientist appears at your desk on Monday morning with a new research associate he has just hired. He has not advised anyone at your institution about this and wants to charge this new RA’s salary to a grant account that was closed two months ago. How do you respond to him and what steps do you take to straighten things out?


Rules For Effective Goal Setting

1. Set Goals That Are Important/Challenging

Related To Mission

Significant

Push You To Achieve

Highly Motivated


Focus On What You Want – Not What You Don’t Want

Keep A Mental Image of Success

“Imagination Is More Important Than Knowledge.”

Albert Einstein

2. State Your Goals In Positive, Not Negative, Terms!


Focus On What You Want – Not What You Don’t Want

Keep A Mental Image of Success

Stay Away From Negative Thinking

“Obstacles Are Those Frightful Things You See When You take Your Eyes Off The Goal.”

Henry Ford

2. State Your Goals In Positive, Not Negative, Terms!


“Dreams Are Just Thoughts. They Become Tangible Goals When We Write Them Down.”

3. Write Your Goals Down.

Helps To Crystallize Thinking

Be Precise

Helps Spot Contradictory Goals

Increases Commitment


“Goals Are Just Dreams With Deadlines.” Diana Scharf Hunt

Creating Deadlines Is A Powerful Management Technique

4. Make Your Goals Time Specific


5. Review Your Goals Regularly!

My Approach: Plastic-Covered Sheet In Telephone Book Drawer

Reviewing Keeps You Focused

Be Willing To Modify/Clarify When Appropriate


6. Don’t Give Up. Continue Until You Achieve Your Goals!


Responsible Delegation

A Manager Must Learn To Delegate Responsibility And Authority In Order To Build An Effective Team!

1. Time To Look At “Big Picture”/Plan2. Greater Staff Involvement = Higher

Morale/Investment3. More Gets Done When Manager Isn’t “Funnel”4. Creativity

Payoffs


Responsible Delegation

1. Inconsistent Application of Policy2. Strain When Manager Feels That An

Employee Is Doing Something Wrong And Has To Confront Him/Her

3. Accountable For Decisions You Don’t Make

4. Asking Employees To Do Too Much – They May Be Resistant (“Don’t Dump on Me”)

5. “I Could Have Done It Myself Faster”6. “Loose Touch With Operations”

Risks/Problems


We are all negotiators Traditional approaches (hard–soft)

• Hard• Contest of wills-desire to win• Take extreme positions – hold out longer• Other party responds in kind• Harms relationships• Exhausting

• Soft• Desire to avoid conflict – maintain

relationship• Makes concessions readily• Often feels exploited, bitter• Harms relationships

Effective Negotiation Techniques


1. Focusing on positions (rather than interests) can result in unwanted/unwise agreements Bargaining over positions causes us to

“defend against attack” The more you defend, the harder to

change Ego gets involved Example – JFK and Soviets

• Ban on nuclear testing

• Roadblock – number of inspections

• Problem – hadn’t defined an inspection

Problems with Traditional Negotiations


2. Arguing over positions is inefficient Taking extreme positions Holding on stubbornly Making small concessions Deceiving the other party as to your true

views Takes time, effort and interferes with

reaching agreement Dragging one’s feet, threatening to “walk-

out” increases time and cost and Increases risk of no agreement being

reached!



3. Arguing over positions endangers an ongoing relationship When there are winners and losers

relationships suffer Anger and resentment are side-effects

4. Simply “being nice” is no answer Can leave you vulnerable May not produce a wise agreement O. Henry’s Gift of the Magi



Technique developed by Roger Fisher and William Ury, Harvard Negotiation Project

Four key points1. Separate the people from the problem

2. Focus on interests, not positions

3. Invent options for mutual gain

4. Insist that the result be based on some objective standard

Alternative: Principled Negotiation


When egos get involved, you often fail to address the problem

Goal – parties should see themselves working side-by-side, attacking the problem, not each other

1. Separate the people from the problem


A negotiating position often obscures what you really want

Compromising between positions can produce an unsatisfactory agreement

Discuss what you want in an agreement (including relationship issues)

2. Focus on interests, not positions


Pressure of negotiations can make it difficult to see optimal solutions

Set aside time outside of negotiations to brainstorm for possible solutions

• Separate

• With other party

• With third party

3. Invent options for mutual gain


Seek agreement on a fair, independent standard

• Market value

• Expert opinion

• Trusted 3rd party

Prevents either party from having to “give-in” to the other

4. Insist that the result be based on some objective standard


1. If there are any non-negotiable issues, make them clear up front

2. Consider the impact of the negotiation process on both:

Relationship with other party Next negotiation

Other key issues:


Key To Success in Management

Recognize you are a unique person who has management responsibilities

Understand your talents

Integrate these insights/approaches into your own style

There is no “one size fits all” model of management


Managing Money!


Departmental Administration –

“Where the Rubber Meets the Road”

Transactions are initiated by DA Policy compliance is monitored by DA Financial management is

implemented by DA Basic records are maintained by DA Central administration relies on DA Internal control depends on DA!

“In the real world, the DA strives to provide quality support to the research enterprise while following all of the applicable policies and rules. It’s not always as easy as it sounds!”

Faculty

Sponsored Programs Office

Purchasing Office

Funding Agencies

Health and Safety Office

Human Resources Office


But the Consequences of Poor DA Can Be Disastrous: Research activities slow down Projects run out of money Key resources may not be

available when needed (equipment, personnel)

Audit exposure exists


Arguing with an Auditor is LikeWrestling with a Pig in Mud...

After a while, you realize the pig ENJOYS it!


Five Financial Management Challenges for the DA!!

Transaction processing - timely and accurate

Compliance and policy enforcement Expense classification Conformity to award documents Fiscal control


Timely Transaction Processing

This is one area that you can control (But how?)

Issues to consider• Staffing

– By transaction type (travel, purchasing)– By project– Implications, cross-training, staff vacancies

• Sequencing– First in - First out– Something else (tagging of urgent transactions)


Timely Transaction Processing• Pre-audit for compliance

– Goal - perfect transactions processed immediately every time!

– Reality - the more detailed the pre-audit, the longer the processing time.

– Dilemma - how to balance?

• Tracking after transaction leaves department– Do you wait for the faculty member to yell

when he hasn’t gotten travel advance?


Compliance/Policy Enforcement

“The DA has the toughest job in the policy hierarchy because real-life interpretations and daily enforcement happen in the department.”



The DA is expected to assure compliance at all levels:

• Regulatory• Specific Agency• Institutional• Departmental



• Research administration• Human resources• Safety• Employee benefits• Travel• Expenditure control• Procurement

And for every aspect of the institution's compliance program:

An impossible task?


“Without clear written guidelines, the enforcement task is impossible to carry out in a consistent and reliable way.”

An Old DA Proverb:


Expense classification Expenses charged to correct

activity/account/project Clear demarcation between direct

and indirect costs Consistent application of costs to

be in CAS conformity Identification of cost sharing and

proper treatment


Conformity to Award Documents

Expenses charged within the proper project period

Observation of prior approval requirements

Expenditures within budget limits


Fiscal Control

“The best way for a DA to get yelled at is to ignore fiscal control”

To avoid:• Stay within budget• Be certain that the nature of the

expenditure matches the purpose of the fund


Really Big Departmental Administration “No-Nos”

Cost transfers with weak (or no) documentation. (“The expenses were transferred to use up the balance of the award”).

Failure to maintain labor certification records.


Really Big Departmental Administration “No-Nos”

Mis-match of labor charged to effort expended (“Just charge my labor to project B so I can buy a computer from project A”)


Financial Planning

Question 1: Where are we now?


Financial Planning

Question 1: Where are we now?

Having an accurate, detailed view of current financial status (by project and department-wide)

• Can we rely upon institutional accounting records? or

• Do we need a departmental system (“shadow accounting”)?


Financial Planning

Question 2: Where are we going?Projecting expenditure/revenue forecasts into the future (for fiscal year)

• Special attention to personnel– Plan to cover soft money people for year– Note institutional policy for “layoffs”

• Special attention to fixed expenses– Equipment (or software) maintenance

contracts, rent

Name Funding Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May JunWashington, G. GRIP 24% 14th

Lincoln, A. DOE-F 15%GRIP 60% 14thMIP 10%STC/Teleimmersion 15%

Jefferson, T. DOE-F 12.5%I-FLOW 50%NANO 25%STC/Teleimmersion 12.5%DOE-F 50%STC/Teleimmersion 50%100%

Clinton, B. GRIP 100% 14th

Ford, G. DOE-F 20%STC/Teleimmersion 13%

Eisenhower, D. MIP 100%

Johnson, L. STC/Teleimmersion 100%

Truman, H. GRIP 100% 14th

Reagan, R. MIP 100%

Roosevelt, F. DOE-F 30%I-FLOW 20%NANO 10%MIP 10%STC/Teleimmersion 30%

Personnel Funding Chart

Name Funding Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May JunLarry DOE-F 20%

STC 8%MCNC 5%STC 28%MCNC 33%ITR-F 14%(NEW)DOE-F 14%ITR 5%ITR-F 38%(NEW)DOE-F 38%

Curley TRUST 20%STC 60%STC 35%MCNC 5%GRIP 20%ONR 20%ITR-F 20%(NEW)DOE-F 5%ITR-N 35%KECK-OVHD 35%ONR 10%ITR-F 40%(NEW)DOE-F 30%

Moe TRUST 10%STC 72%MCNC 18%STC 32%DOE-M 100%ONR 20%GRIP 23.5% (NEW)DOE-F 33%ITR 23.5%


Name Salary Funding Acct. # Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May JunKiser, S. $150,000 State (100%) 2-32761

Lawrence, S. $15,586 State (100%) 2-32761

Quigg, T. $12,207 State (100%) 2-32761

Vrana, S. $150,000 State ( 69%) 2-3276125% on grants Kenan Professor (6%)6-60024

CISMM (10%) 5-31865CISMM (8%) 5-32690IBR (7.5%) 5-37125IBR (9.5%) 5-37125ITR (7.5%) 5-47737

Wdowik, M. $20,348 State (100%) 2-32761

Vargas, A. $457,318 Federico Gil (18%) 6-6230133% on grants Neurosurgery (3%) 5-51788

CS 51788 (2%) 2-32761DARPA (10%) 5-35751State (45%) 2-32761NLM (6%) 5-55807CS 55807 (2%) 2-32761Livermore (14%) 5-42519NLM (33%) 5-55807CS 55807 (15%) 2-32761State (5%) 2-32761State (14%) 2-32761NLM (37%) 5-55807CS 55807 (16%) 2-32761State (39%) 2-32761NLM (20%) 5-55807CS 55807 (8%) 2-32761


-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

Jan-01 Feb-01 Mar-01 Apr-01 May-01 Jun-01 Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01

Incr Budget Cum Exp Proposal Budget Total Budget Cum + Proj

End Date

Maximum Award Amount

Incremental Funding

Project Budget

Actual Expense

Burn Rate

Comparison – Direct Grants to Institutional Funds

Grant Volume

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000

Inst.

Funds

$-

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

0 500 1000 1500 2000 2500 3000 3500

Comparison – Space to Actual Indirect Recovery

Square Feet

Actual

Indirect


1. Rules – the DA must know or know where to find

Federal OMB circulars• A21

Specific sponsor• NIH guide

• NSF Grant Policy Manual

Specific institution rules (policies)• Travel

• Consulting


Applicable OMB Circulars

A-21 Establishes principles for determining costs applicable to grants, contracts, and other agreements

with educational institutions

A-110 Uniform administrative requirements for grants and agreements with institutions of higher education, hospitals and other non-profit institutions

A-133 Audit standards for states, local governments and non-profit organizations


A-21 Cost Principles: Definitions

Direct Cost – any cost which is identified specifically with a particular sponsored agreement or other institutional function.

Facilities and Administrative (F&A) Costs – costs incurred for common or joint objectives that cannot be readily/specifically identified with a particular sponsored project or other institutional function.

Composition of Total Costs – the total cost of a sponsored agreement is comprised of the allowable direct costs incident to its performance, plus the allocable portion of the allowable F&A costs of the institution.


Sample Budget2 Graduate Students $40,000 $40,000Fringe Benefits $6,950 $6,950Equipment $50,000 $50,000Travel $7,500 $7,500Supplies $6,000 $6,000Computer Services $8,000 $8,000Other (maintenance, communication, tuition) $2,950 $15,000 $17,950Total Direct $96,400 $65,000 $161,400F&A (46% of MTDC $44,344 $44,344Grand Total $205,744

MTDC = Modified Total Direct Costs

(TDC-Equipment-Tuition)*

*Also minus any SubK costs > $25,000


A-21 Cost Principles

University accounting systems must allow for the assignment of costs to various institutional functions consistent with A-21 definitions.


A-21:Major Institutional Functions

1. Instruction – all teaching/training activities• Institution Funded• Sponsored Instruction/Training• Departmental Research (No separate budget)

2. Organized Research – All R&D activities that are budgeted and accounted for separately

• Sponsored Research• University Research


A-21: Major Institutional Functions

3. Other Sponsored Activities• Health Service• Community Service

4. Other Institutional Activities• Residence and Dining Halls• Hospitals• Athletics• Book Stores• Museums


A-21: Major Institutional Functions

1. Instruction

2. Organized Research

3. Other Sponsored Activities

4. Other Institutional Activities

TASK: To allocate (assign) each cost incurred by the institution to one or more function (cost or objective) in reasonable/realistic proportion to the benefits provided or other equitable relationship.


Account Numbers

5 – 12345 – 0 – 110 - 32765 – 12345 – 0 – 110 - 3276

Ledger Account Budget

(Fund Source)

Purpose Department

A-21 Cost PrinciplesA-21 Cost PrinciplesTotal Institutional Costs

1. Instruction 3. Other Sponsored Activities2. Organized Research 4. Other Institutional Activities

Allowable* Unallowable*

Direct

Costs

Indirect

Costs

(F&A)

* For Federal Participation



Tests of Allowability: in order to be allowable as either a direct or indirect cost, a cost must be:

Reasonable


A-21 Tests of Allowability

Reasonable: a cost may be considered reasonable if it’s nature and amount reflect the action that a prudent person would have taken under the circumstances prevailing at the time the decision was made.

Generally recognized as necessary

“Arm’s-length” bargaining

Acted with due prudence

Consistent with institutional policies applicable to all of the institution’s work




Reasonable

Allocable under A-21 principles/methods



Allocable: a cost may be considered to be allocable to a particular project if it:

is incurred solely to advance work under the sponsored agreement or

it benefits both the sponsored agreement and other work of the institution, in proportions that can be

approximated using reasonable methods or

it is necessary to the overall operation of the institution and is, consistent with A-21, deemed assignable in part to the sponsored agreement.




Reasonable


Treated consistently



Consistent Treatment

In estimating, accumulating and reporting costs

• the format and definitions used in the proposal budget should be consistent with that used in both the institution’s accounting system and on financial reports submitted to the agency

In allocating costs incurred for the same purpose

• All costs incurred for the same purpose, in like circumstances, are either direct costs only or indirect costs only




Reasonable


Treated consistently

Conform to limitation/exclusions under A-21 and sponsored agreements



Limitation/Exclusions under A-21 and sponsored agreements

A-21 defines in Section J (50 items) unallowable costs that include:

• Alcoholic beverages• Alumni activities• Bad debts• Commencement costs• Lobbying costs• Fines and penalties• Goods/services for personal use• Losses on other sponsored agreements/contracts• Student activity costs



Limitation/Exclusions under A-21 and sponsored agreements

Sponsored agreements may be subject to statutory limits on allowance of costs

Unallowable costs shall be identified in accounting system

A-21 Cost PrinciplesA-21 Cost Principles

Allowable*• Reasonable• Allocable• Consistent• Not excluded

Unallowable*• Don’t meet A-21 test

• Specifically not allowable in Section J

• Specifically not allowable in award

Direct Costs

• Specific to project

Indirect Costs(F&A)

• Common objective• Not Specific to project

* For Federal Participation

Total Institutional Costs1. Instruction 3. Other Sponsored Activities2. Organized Research 4. Other Institutional Activities


Facilities & Administrative Costs

“Costs incurred for common or joint objectives and therefore cannot be identified readily and specifically with a particular sponsored project or other institutional function.”

Facility Costs Building depreciation and use allowances (50 year use)

Interest on debt associated with certain buildings Equipment depreciation and write offs Operations and maintenance Library


Facilities & Administrative Costs

Administrative Costs (capped at 26% - can take 24% fixed allowance)

General administration

Departmental administration

Sponsored project administration

Student administration and services


Types of Support

Federal Assistance

Mandatory – block grants, formula-driven Discretionary – competitively awarded

Modes of Support Grants – assistance Contracts – procurement/acquisition Cooperative Agreements – assistance but with

strings attached


Grant

a legal instrument for transferring money, property, or services to the recipient in order to accomplish a public purpose of support or stimulation where there will be no substantial involvement between the federal agency and the recipient during performance.

31 U.S.C. 6304


Grants

• Broad Agency Announcements (BAA), Program Solicitation• Financial Assistance Award• Made for stated purpose (proposal/award)• Made for stated period of time (project period)• Made to an organization in the name of a Principal

Investigator (PI)• No substantial programmatic involvement by awarding

agency• Funding may be annual, multi-year or for entire budget

period• Minimum of limiting conditions


FAR 2.101 defines a contract as a mutually binding legal relationship that obligates the seller to furnish supplies or services and the buyer to pay for them.

Contract

an agreement, enforceable by law, between two or more competent parties, to do or not do something not prohibited by law, for a legal consideration.


Contracts

RFP and IFB Mutually binding legal relationship that binds the seller to deliver

certain specified goods or services (deliverables) in exchange for certain specified consideration (e.g., money)

Terms are usually detailed and specific Activities frequently dictated by sponsor (buyer) Less latitude to modify scope of work and line-item expenditures Funding may be incremental, tied to work components, final payment (e.g. 10%) may be held till “acceptance” of deliverables Process governed by the FAR (Federal Acquisition Regulation)


Cooperative Agreement

a legal instrument for transferring money, property, or services to the recipient in order to accomplish a public purpose of support or stimulation where substantial involvement is expected between the government agency and the recipient.

–31 U.S.C. 6305


Cooperative Agreements

Financial Assistance Award Similar to grant except

• There is substantial programmatic involvement by awarding agency.

• Principal purpose is to transfer money or something of value to recipient in order to accomplish a public purpose.


Cooperative Agreements

Agencies have substantial freedom to structure the terms and conditions (T&Cs)

• Agencies must issue CA regulations

• Often differ from standard assistance regulations and may even resemble acquisition regulations


3 P’s – Patron (Grant): Partner (Co-op Agreement): Purchaser (Contract)

• Idea for the project is initiated by the investigator.

• No substantial involvement between the grantor and grantee.

• Grantor has no expectation of a specified service or end product

Grant

DISTINGUISHING CONTRACT, GRANTS AND COOPERATIVE AGREEMENTS

Research Requirement

Procurement Contract

YESNO

Principally forPublic supportOr stimulation

Co-op Agreement (SubstantialRelationship)


Cost Transfers The transfer of expenditure from

one account to another • Allowable – costs that can be specifically

identified with a particular project or activity• Allocable – cost can be quantified

Red Flags • Transfers older than 90 days• Transfers in the last month of the award or

after the award has expired• Round numbers• Explanations that raise more questions than

answers


What Auditors look for Transfer must be supported by

documentation that gives full explanation of how the error occurred

• Stating ‘to correct error or ‘transfer to correct project’ is not sufficient

• State how the item being transferred benefits the account being charged

• State how error occurred• Identify steps to prevent future errors

Frequent errors in the recording of costs may indicate the need to review the accounting system and/or internal controls


Surviving an AuditAudits - Auditors Pre-award – sponsor agency F&A - DHHS Grant/contract – sponsor agency Contract closeout – sponsor agency or

cognizant audit agency * System – UNC-CH Internal Audit, N.C.Office of the State Auditors,

cognizant audit agency * A-133 - N.C. Office of the State

Auditors* most common types of audits


Types of Audits System Audit

• Budgeting process, recharge center, purchasing procedures, time and effort/cost sharing

A-133 Audit• Compliance and internal controls • Review financial transactions, payroll, effort

reporting• Looking at how we have used the research

dollars and how we have allocated costs to specific projects


What Auditors Test For Compliance to program guidelines Unallowable costs (cost transfers) F&A rate and calculation Timeliness and accuracy of reports

• Progress, Financial, Patent and Invention, and Special reports

Program Income Sub-recipient monitoring Time and Effort Reporting

(compensation and certification) Cost Sharing


When Things Go Wrong Reach an understanding of the terms

and conditions Communicate roles and

responsibilities before problems arise Involve all responsible parties Follow up – don’t let time slip away Involve Sponsored Programs Office

sooner than later Who accepts the financial burden


When do you start planning for the closeout process?

a. At the time the proposal is developed.

b. At the time the award is accepted.

c. At the time modifications, extensions or supplements are approved.

d. Just prior to the expiration of an award.

e. At the time of expiration of an award.

f. All of the above.

Closing Out an Award


Project Closeout Responsibilities Final Reports

• Technical, progress, narrative (Principal Investigator)

• Patent / Inventions (Sponsored Research & Technology Development Offices)

• Property (Sponsored Research & Asset Management Offices)

• Financial (Sponsored Research Office)• Sub-recipients (Sponsored Research

Office and PI) ** Reports from sub-recipients needed in

advance in order to incorporate into reports to sponsor


Send notices of expiring awards well in advance of expiration date

Create reports to track closing awards Require written request from department if deadline cannot be met

Develop a policy for writing off small balances

“Freeze” award once final financial report is sent

Solutions to Meeting the Deadlines


Closeout Checklist Submit final reports Report all final financial obligations Reconcile outstanding cash advances,

imprest cash, and advances for gift cards to study subjects

Cancel or change account for open orders

Prepare personnel actions to transfer to new source

Document required cost sharing Record program income


Post-Term Charges Costs incurred after termination

date of the project/award Must be explained and justified for

allowability Common post-term charges

• Payroll expenses• Procurement card charges• Telephone costs• Copy services• Service center charge


Deficits / Over DraftsOccur when cumulative expenses exceed amount awarded

• May be considered voluntary uncommitted cost sharing

• Deficits must be transferred out of sponsored award no later than 90 days after termination date


What is Cost Sharing?

A-110:• A.2(i) Cost Sharing or matching is the portion of project or program costs not borne by the Federal Government.


Definitions

Cash: The recipient’s cash outlay; contributions under the direct control of the recipient.

In-Kind: Value of non-cash contributions provided by non-Federal third parties.• Webster’s definition:

– “with goods or produce rather than money”


Cash Contributions A-110 Definition: “the recipient’s cash

outlay, including money contributed to the recipient by third parties.”• Salaries & benefits of University

employees• University purchased equipment or

supplies or travel or other allowable expense

• Facility & Administrative costs on the above

• Waived F&A costs (with permission of the sponsor)


Sources of “Cash” Contributions

University unrestricted funds contributed to project:• State funds• Gift accounts• Endowment funds• F&A recovered and returned to

departments• Program income


Third Party In-Kind

Volunteer Services:• Based on rates paid for similar

work• Includes associated Benefits• *can not include F&A see A-110

c23(e) Donated Equipment & Supplies:

• At current fair market value


Acceptable Cost Sharing (A-110 C.23)

Must be verifiable from the official University records

Not be used as cost sharing for any other Federal sponsored program or project

Be necessary and reasonable for proper and efficient accomplishment of the project

Allowable under A-21, the agreement, and public laws


Acceptable Cost Sharing contd.

Be incurred during the effective dates of grant

Not be paid by Feds under another award (except where authorized by Federal statute to be used for cost sharing or matching)

In the approved budget when required by the Federal awarding agency


Documentation of Cost Sharing

Salary & benefits – Payroll records and effort reports

Non-payroll – PO#, check #, AJ-1 #, object code & dates of expenditure posting in FRS on supporting source152


Documentation of C/S contd.

In-Kind Documentation:• Cash Contribution – sworn statement

by financial officer, copy of check or receipt for payment

• Equipment – vendor invoice showing total item cost

• In-Kind Other – Letter of support detailing support (time, place, value)


F & A / Indirect Cost Sharing

Unrecovered Indirect:• Reduced or waived F&A• Example: federal funded award using 10%

– Negotiated F&A rate of 46%– F&A Costs cost shared 36%– F&A Costs paid by sponsor 10%

Indirect Cost – F&A on the non-sponsored projects cost (cost sharing source) may be used for additional cost sharing


Effort Reporting

Effort Certification• Required by Federal regulation: OMB

Circular A-21, section J.10• Provides support for salary & benefits

charges to grants & contracts• Documents that effort commitments

have been met• Documents cost share


What is 100% Effort Effort required to meet obligations

of a faculty member. Usually described in appointment letter.

Hours will be different for different faculty members, and may vary during the year

40 hours is NOT the standard for faculty

For Faculty & Staff (exempt & non-exempt employees) effort % is based on total hours worked

instructor: tim quigg associate chair for administration and finance computer science department,...

Documents

performance slide

necessary skills people

necessary skills reward

catalyst slide

clear performance expectations

necessary help employees

rights reserved slide

immediate supervisor