Transcript University Compliance Office Gail Huelsmann, University
Compliance Office Presentation
Washington University in St. Louis September 5, 2002 Senior Compliance Auditors Becky Evans 362-4907 Byron Morgan 362-4909 4480 Clayton Avenue Campus Box 8016 http://universitycompliance.wustl.edu/
University Compliance Office 1
Agenda
Description and purpose of the University Compliance Office Typical compliance review process Significant compliance issues noted in the 5 reviews completed University Compliance Office 2
What is the Washington University Compliance Program ?
The Washington University Compliance Program is the expression of a commitment by Washington University to carry out its educational, research, and health care activities in compliance with all relevant laws and regulations and with the highest integrity.
University Compliance Office 3
What is the Washington University Compliance Program?
Cont’d Washington University’s Board of Trustees approved the establishment of the Washington University Compliance Program and a University Compliance Office in April 2000. A Code of Conduct was then developed with input from many members of the University community, and issued to University community members in April 2002. Three full-time compliance auditors perform proactive and investigational (as needed) compliance audits. The results of compliance audits are incorporated in formal compliance training programs that are being developed or refined.
University Compliance Office 4
Specific Role of the University Compliance Office
Verify that effective compliance is occurring in all activities governed by federal law and regulation, and by University policy.
Verification does not mean performing the work of compliance. – It means making sure that all relevant activities have effective compliance organizations. – It means making sure that these compliance organizations have effective policies and procedures, effective training programs, and effective techniques for monitoring compliance.
University Compliance Office 5
Specific Role of the University Compliance Office
Cont’d
Conduct compliance audits.
Auditing is not the same as monitoring.
Auditing and monitoring are both means of checking to see if compliance has occurred. However, there are important differences: a) Monitoring is typically done by the activity that is being monitored. b) Monitoring typically occurs much more frequently than auditing. c) Monitoring is less formal. d) Monitoring and auditing should work together. University Compliance Office 6
Specific Role of the University Compliance Office
Cont’d Develop, revise, and maintain a University Code of Conduct.
Maintain a University compliance hotline for the reporting of suspected violations or concerns. Maintain effective and ongoing communication with the University’s senior management and with the Audit Committee of the Board of Trustees concerning the state of compliance in University activities that require compliance. University Compliance Office 7
Typical Compliance Review
Based on annual plan & special requests Usually 4 to 8 weeks in length WU Guidelines for Direct-Charging Costs to Grants (“Blue Book”) OMB Circular A-21 (cost principles) NIH/NSF Guidelines Focus on
PARS Documentation
and
Supporting
for charges to grants University Compliance Office 8
Typical Compliance Review Process
Opening Meeting
Review samples of supporting documentation Interview sample of PIs and other employees (sourced to federal funds) Review of grant proposals and award documents as necessary Questions back and forth between department administrator and compliance auditor (usually by email) Draft report to department head and administrator (includes opinion on overall compliance and recommendations requiring action) Department administrator responds to recommendations
Final report issued
University Compliance Office 9
Significant Issues From Past Reviews
PARS and Effort Reporting Direct Charges to Grants – – – Documentation Justification Unallowable & Questionable Costs Proportional Benefit Cost Transfers Animal & Human Subject Protocols Training Grants University Compliance Office 10
PARS
Legal Document, Official University System for Reporting Salary Charges to Grants Completed timely and signed properly Reflect actual effort Administrative Issues – – – Administrative Job Codes Effort on Grant Proposals and Committees Other Administrative Activities Key Personnel & Effort Reporting University Compliance Office 11
PARS-Administrative Issues
Activities generally not direct charged to grants, but recovered indirectly through Facilities & Administration Rate (F&A) “The expenses under this heading are those that have been incurred for administrative and supporting services that benefit common or joint departmental activities or objectives in academic deans' offices, academic departments and divisions, and research centers." (OMB No. A-21 F.4.a.) University Compliance Office 12
PARS-Administrative Issues Cont’d
Activities generally not direct charged to grants, but recovered indirectly via Facilities & Administration Rate (F&A) Faculty and staff departmental administration duties may include, but are not limited to: preparation and review of Personnel Activity Reports preparation of departmental budgets and/or payroll review of departmental accounts and financial statements preparation of grant applications planning for building projects and renovations selection and recruitment of faculty selection of graduate students selection and training of staff editing professional journals where the journal provides funds which are administered by WU or where WU is a sponsor REF:( http://aladdin.wustl.edu/finance.nsf/ ) (by function Med School website) University Compliance Office 13
PARS-Administrative Issues Cont’d
Job titles generally not direct charged to grants, recovered through indirectly through the F&A Rate.
Administration and clerical titles that are typically coded as departmental administration may include, but are not limited to: accountants bookkeepers accountants office managers payroll assistants secretaries stockroom attendants University Compliance Office 14 REF:( http://aladdin.wustl.edu/finance.nsf/ ) (by function Med School website)
Key Personnel & Effort Reporting
Does effort in the proposal match actual effort ?
(salary charged to grant and cost sharing matched with University payroll system) Who are the key personnel listed in the proposal ?
Per NIH guidelines effort decreases (key personnel) of 25% or more have to be reported to the agency.
(Does the department have a system to monitor this ?) University Compliance Office 15
Review of Direct Charges Non-Personnel
1. Normally Allowable (A-21 F.6.b) 2. NOT Normally Allowable (A-21 F.6.b) 3. Questionable (“Okay, if…” A-21, BUOB Manual) 4. Unallowable (A-21 J.) University Compliance Office 16
BACK TO BASICS!
University Compliance Office 17
“
The Golden Rule
”
Direct Costs
“Direct costs are those costs that can be identified specifically with a particular sponsored agreement……or that can be directly assigned to (such activity) relatively easily and with a high degree of accuracy.” (A-21 D.1.) University Compliance Office 18
Significant & Common Compliance Issues Noted:
Missing or unclear PI or Designee Approval of Expense
Lack of PI Justification !
Lack of PI Justification !
Lack of PI Justification !
University Compliance Office 19
Approvals
A-21 (B4d) “….(e.g., signature or initials of the principal investigator or designee or use of a password) will normally be considered sufficient.” WU Policies for Direct-Charging Costs to Grants (Blue Book) Designee “is in the position to know the linkage of the expense with the funded project is close and clear.” University Compliance Office 20
Approvals Compliance Problems Noted:
Missing approvals
(Most common - cost transfers, consortium payments, modifications) Clarity of approvals (Whose initials/signature? Which initials/signature?) Appropriateness of designee University Compliance Office 21
Documentation
“Careful and clear documentation of actions is proof of the investigator’s conscientious exercise of the fiduciary responsibility inherent in the expenditure of public funds……. WU “Blue Book” University Compliance Office 22
Documentation
Cont’d …...Proper documentation for charges or cost transfers to a grant should pass the “stand alone” test. An interested party, without additional explanation, must easily understand the paper audit trail for a charge or transfer.” WU “Blue Book” University Compliance Office 23
Normally Allowable
Direct Costs Lab Supplies & Services Other Expenses Travel Equipment Consortium Costs Consulting Costs (Reminder: Use Consulting Form) Animal Expenses Human Subject Expenses
PI Approval and Back-up Still Required
University Compliance Office 24
Normally Allowable Compliance Issues
Travel
Traveler Not Paid From Fund Charged
Absence of Receipts Inappropriate Receipts need details Misc. - Question phone charges, use of meal per diems, Use TA for >$500 and not CR University Compliance Office 25
Normally Allowable Compliance Issues
Equipment
Lack of Justification for General Purpose Items (especially small equipment) Purchase of Equipment Within Final 60 Days of Project Period (project not renewed) $25,000 or more - Screening Certificate, 3 bids - in good shape!
University Compliance Office 26
NOT Normally Allowable
Direct Costs - A-21 F.6.b
Supplies (3403) (Can the item be justified as project specific?) Phone - Monthly (3530) - Is it Off Campus ?
Office Supplies (3411) (Admin Core?) Postage (3512) DP Line Costs Monthly (3532) (Is there a special circumstance?) (3532) Laser Printer Supplies (3455) Dues-Memberships (3557) University Compliance Office 27
Questionable
Direct Costs Uniforms (3424) Laundry (3537) Advertising (3540) Books (3575) Subscriptions (3576) Recruitment (3541) Publication of a Book (3517) Relocation (3552) University Compliance Office 28
REMEMBER!
PI MUST JUSTIFY
(Do the costs benefit the project(s) being charged closely and clearly?)
PI MUST APPROVE
DOCUMENT!
DOCUMENT! AND…..
Don’t Assume the need for the expense is understood!
Don’t expect SPA to “remember last month’s justification”.
University Compliance Office 29
Unallowable
Direct Costs
(A-21 J., SPA Policy Memo 1/31/02)
Legal Fees (3080) Memorial Contributions Bank Fees (3524) Entertainment (3550) (3443) Social Expenses (3553) Supplies (3487) Supplies-Other Prizes/Awards (3554) (3499) Bad Debt Expense (3560) 30
Unallowable D
irect Costs
Cont’d
Gifts (3569) Other Services (3588) Alcohol (3574) Other Dues/ Memberships (3587) Misc. Expenses (3599) Other Travel-Dues (3657) University Compliance Office 31
Proportional Benefit
From A-21: "If a cost benefits two or more (grants) in proportions that can be determined without undue effort or (administrative expense), the cost should be allocated to the (grants) based on the proportional benefit." (C4d(3)) The cost in question should be specifically identifiable with the group of grants relatively easily, and with a high degree of accuracy .
Credible documentation of this identification must be maintained by the department. The Principal Investigator must approve the use of proportional benefit and the method of its use.
Distribution of allowable direct costs by proportional benefit is an automated feature of FIS. Supporting documentation required.
REF: http://spa.wustl.edu/dircharge/interim.html
University Compliance Office 32
Cost Transfers
Cost transfers from one grant to another are permitted in order to link a cost more appropriately with the benefit it is providing.
Detailed explanation required.
“To correct an error” is not an acceptable explanation.
Cost transfers from one grant to another are
not permitted in order to solve funding problems or for other reasons of convenience.
(C4b) Cost transfers must be submitted within 120 days of the original charge or within 30 days following the ending date of the grant, whichever is sooner.
Approval by PI
.
Payroll cost transfer tips from SPA (6/21/02) REF: SPA Website (direct charges-interim guidelines), Research News Website (message library-other), General Accounting Manual Chapter 15 University Compliance Office 33
Human Subject Protocols
IRB Protocol is approved under PI of grant, has same title as grant, funding agency matches, & approval is effective during grant award period Consent forms signed & dated by PI & subject, signed during period of active protocol, and title on consent form agrees to approved protocol title University Compliance Office 34
Animal Studies
Protocol used for purchases is approved for use by the PI of the grant being charged, and the title and agency also match the grant Date of animal purchases fall within IACUC approved protocol period Species ordered matches species in approved protocol PI/designee approved requisition University Compliance Office 35
National Research Service Awards (NRSA) Ref. NIH GPS Pg. 175
Key area of non-compliance for T32s
•
Stipends & other allowances paid out prior to submitting Appointment Form to NIH
(GPS Pg. 206 & NGA Restrictions) • Other - wrong insurance charges, wrong stipend levels, missing amended Appointment Forms University Compliance Office 36
Resources
WU Policies for Direct Charging Costs to Grants (“Blue Book” ) – SPA Website – ttp://spa.wustl.edu/direct.html
OMB A-21 – http://www.whitehouse.gov/omb/circulars/a021/a021.html
NIH Grants Policy Statement – http://grants.nih.gov/grants/policy/nihgps_2001/nihgps_2001.pdf
National Science Foundation Grant Policy Manual – http://www.nsf.gov/ University Compliance Office 37
Resources
Cont’d Washington University Research News – http://researchnews.wustl.edu/medadmin/rnews.nsf/WSM?O
penView&Count=1000 Washington University Policies (Systems & Procedures) – http://fishelp.wustl.edu/ Code of Conduct http:// c odeofconduct.wustl.edu/ Compliance Office http://universitycompliance.wustl.edu/ University Compliance Office 38
Compliance Definition
Com-pli-ance
- “The act of agreeing passively to a request, rule, or demand. The tendency to yield to others.” -
WU Environment
-
Agreeing passively
= a required job duty for each of us - paid to do it -
Others
= mostly government entities University Compliance Office 39