Strategies for Managing Stress and Boosting Brain Bandwidth

ConcentrationNew Behavioral Economics, Cognitive Science and Social Psychology Research Findings Help Research Administrators

If you’ve been a research administrator or financial administrator working in research administration for any length of time, you’ve figured out one thing: the tremendous pull this job has on your concentration and focus. If you’re like the talented team in my office who are performing cradle-to-grave research administration, the orientation to details, double checking formulas and worksheets, and the weight of forms and online data entry, it’s a sea of work. It’s vitally important to develop strategies to manage cognitive overload, so that you can see your work (spot errors before they are entered), think through the logic of your work process (what is required of your application or your financial process – not to perform it on autopilot), and adjust/incorporate new information in the process of managing work.

Common Strategies for Managing Stress and Maintaining Concentration

  1. Taking a break – at least once an hour for 5-10 minutes, away from your computer.
  2. Eating healthy food and snacks during the work day (my office has nuts, granola bars, green tea and popcorn to fuel hungry minds).
  3. Ask for help – reach out and have your colleagues review your work when you develop Excel blindness or are stuck on your application budget.
  4. Facilitate communication and head off surprises so that you can focus on the work at hand.

Mindfulness and Increased Attention

Harvard Social Psychologist Ellen Langer has conducted research for the last four decades on mindfulness in a variety of aspects of human life, including the performance of complex work. Langer defines “mindfulness” as the process of actively noticing new things – being actively engaged in work or life, rather than not thinking about what you are doing when you are doing it. (Think about it – it happens a lot!)

Langer contends that a mindful context for addressing complex work is identifying the best way to apply rules and guidelines given the context of a particular situation. Langer’s definition of mindlessness in complex work is “one size fits all.”

Langer has shown that mindfulness lead to better performance, increased attention, and better outcomes. In one study, she had symphony musicians, who are often bored to death with playing the same music often – play differently. One group was told to play the same as usual. The second group was told to play the same music, but to play it mindfully. It was the same music, but they brought to the performance in small and perhaps imperceptible ways, their own personal touches. However, this group of musicians were paying attention in a new way. And the results showed that this performance was rated higher.

Langer does not like checklists – she believes that they foster mindlessness (unless they trigger us to be mindful).

Strategies for Improving Mindfulness

  • Are there aspects of your work that are repetitive and boring (like reviewing workflow requests for purchasing, etc)? How can you turn these aspects of your job into something mindful, and challenging? Can you improve the process, turn it into a “game” of sorts, make it new?
  • Can you teach an aspect of your job to someone else, and in the process, become mindful of your work?
  • Is there an aspect of your work that you would like to improve (quality control)? Can you find a team member or colleague that has a similar concern and offer to provide proof reading, etc to them if they will do the same for you?

Brain “Bandwidth” – Factors Affecting Cognitive Capacity index

A team of researchers from Harvard and Princeton have conducted studies to define the effect that specific internal thoughts have on our ability to perform daily tasks. More specifically – they wanted to know if types of external and internal thoughts and experiences could distract or disrupt the cognitive capacity of individuals to such a degree that it would affect their educational achievement or work performance. The answer was yes.

Researchers have known for 40 years that external stimulus (loud repetitive noise) can affect cognitive performance. Sendil Mullainathan, a Harvard economist, and Eldar Shafir, a Princeton psychologist have learned through their research studies that scarcity, an internal stimulus, can also affect cognitive bandwidth available for performing work tasks.

What is scarcity? It’s the internal monologue that occurs when an employee is worried about paying bills, an ill family member, or the cost of day care. Scarcity captures the attention of the employee – because it relates to a pressing need – and reduces attention and focus for other tasks, producing what the researchers call less “bandwidth.” They consider bandwidth to include two aspects of mental functioning – cognitive capacity (problem solving) and executive function (attention, planning and judgement).

Interestingly – it’s not just adverse circumstances that affect cognitive bandwidth. Mullainathan and Shafir found that study participants who were dieting also had bandwidth deficits.

BandwidthCultivating Cognitive Bandwidth

Develop plans and processes to manage aspects of life automatically – to free up bandwidth.

  • Sign up for automatic bill payment and an employer’s 401K plan
  • Schedule breaks and develop an exercise plan for health with a friend or personal trainer.
  • Use services to complete your grocery shopping (Peapod, etc) and stock your pantry with nutritious food. Freeze and reheat healthy meals. Have a group of friends over once a month to cook lunches for everyone to take to work (splits the work of cooking and is lots of fun).
  • If your thoughts are taking over at your desk – get up and walk around – give yourself a time limit to worry (2 minutes, 3 minutes)  and go back to your desk with a bottle of water and your mind clear.
  • Create a space at work for you to go if you need to think about something that you are worried about – or – if you need to capture your thoughts, write them down, but create a process or place where you can boundary your worry and provide yourself a space and a time that you feel better and can productively capture your thoughts and feelings in a time frame that is usable. When you get home, you can review the information and put it to work. The idea is to get the information off your mind at work so you can concentrate and feel better.
  • Most importantly – if you are having long term concerns of any kind – there are often programs through the HR office of many universities that can help you address these types of concerns raised here – use them.

In general – if something is distracting you and it’s minor – take care of it. You will be able to work more effectively if you handle what’s on your mind first. If something more significant is on your mind, and you’re having trouble focusing, it’s best to engage your supervisor to develop a plan on how to manage your work in the short term.

We now have proof that there isn’t enough Diet Coke in the world to power through the data we handle on a regular basis. It’s really important to manage our health, get regular sleep, take breaks and to use the processes here to work smarter – our institutions are counting on it.

Are You Ready for the New NIH Payment Management System?

imagesNot the NIH, Not Again. (Sigh.)

You’ll have to forgive me, I know there is more to research administration than the NIH. (DOD, anyone? NSF?) It’s not that I choose to ignore the rest of the agencies out there funding the Federal share of academic research….really. It’s just that the NIH is in many ways, the canary in the coal mine for new policy at the Federal level. So I figure it’s going to be helpful to more than those of us working in the biomedical research area to talk about some of these issues.

The August Freak Out

In August and September 2013, NIH announced that their grants management systems would transition awardees to a new payment management process in order to allow the agency and their institutes and centers to better track award spending. They provided some preliminary details – enough to make every central office at every university with NIH funding to freak out – how is this going to work? Subsequent communications clarified the process, which have allowed schools to prepare and plan.

changeImplementation in Two Phases

The transition from PMS pooled (G) accounts to PMS (P) sub-accounts will occur over two fiscal years, and it started in October of 2013. There is an excellent FAQ on the transition, which will occur in two phases.

  • Phase 1 – Effective October 2013: Transition of Awards with New Document Number
  • Phase 2 – Effective October 2014: Transition of Continuing Domestic Awards

The notice of grant award will contain additional information to indicate the type of account (G to P) that is being used to award the funds in the transition year. The transition year will require a new award type (Type 4) and administratively shortened segments – for competitive awards in FY14 and FY 15.

Financial reporting requirements will be affected during these changes (there will be additional closing periods) and the reporting requirements for awards will be affected by whether or not the award was made under SNAP (now RPPR). During the transition, it looks like non-competing continuations under SNAP may need to submit two FFRs in FY14.

Importantly – carryover authority is not automatically available during this time frame. Grantees will report unobligated balances and receive approval for these funds to be re-obligated to the new sub-account. NIH states that even if the award was issued with “automatic carryover authority” the grantee has to receive approval through a new NOGA before funds are drawn down.

What You Need to Do Right Now

Review your award portfolio and take steps to ensure awards are appropriately charged for direct costs up front, reducing the need for cost transfers. This saves time, heightens compliance and allows your institution to meet the challenge of shortened reporting time frames.

  1. How many awards are under SNAP? How many are not under SNAP? (This will affect the calculation of your unliquidated obligations and unobligated balances – which, in this new world of payment management should be minimal.)
  2. What are their project dates, and how are they looking financially? (Are all expenses hitting the project in a timely manner?) If not, why not?
  3. What systems are in place to ensure direct charging of appropriate expenses (salary and non-salary) to awards, and reconciling expenses on a monthly basis? If these systems don’t yet exist, what needs to be done to set them up?
  4. Is there a process to regularly meet with investigators to review award activity and plan for changes in allocation of expenses proactively (to prevent cost transfers)?
  5. What reporting and queries can you utilize to easily manage your portfolio and provide updates to your investigators?
  6. Start to develop great relationships with your subcontract sites now – if you haven’t already. You’ll need to have them generate their final invoices faster than they have in the past.

What Your Investigators Need to Know

money-under-mattress-300x217We all know PI’s who think of Federal grants like funds stuffed between a mattress for a rainy day. Yet for every investigator who thinks like that, there are two that understand and have a very keen appreciation for managing awards. However, the new payment management system, combined with the shortened time frame for closing out awards is creating a new environment for managing sponsored funds.  We have to impress upon our most studious investigators that if they do not use their Federal funding, they will lose it.

This is the time when we can help our investigators by providing administrative leadership:

  • Clearly outlining what our investigators need to know about the policy and how we need to work with them to administer their projects.
  • Providing them with financial information regularly so they can make decisions about their research plan and strategy (and we can ensure administrative actions regarding purchasing, effort and salary administration and reimbursements are managed in a timely manner).
  • Updating our investigators regarding policy changes and trends in the availability of carry forward funds, additional reporting requirements, and other trends to assist them in managing their current awards and planning for new applications.

The Department of Defense already has a strong payment management system in place, but it stands to reason that the Department of Health and Human Services, and other federal agencies will look to adopt more stringent monitoring of federal grants. Have you seen the Do Not Pay website? The Obama administration, in creating a government that utilizes data and analytics to generate accountability, is creating a network of systems to ensure that funds are distributed, tracked and paid to the proper recipients.

One Part Challenge, Two Parts Opportunity

To be sure, the next 18 months aren’t going to be easy – but working together we’ll transition to the new payment management system. More importantly – it’s an opportunity to introduce new ways of managing sponsored projects that can remain in place to meet the challenges of tighter Federal funding in the future.

Happy New Year! A81 Is Here!

It’s 2014! Our holiday wishes came true – at least some of them, any way. No shutdown in Washington D.C. – check. At the same time, Congress decided to roll back part of the sequestration cuts and restore funding to many areas of the Federal Government affected by last years deep spending cuts – check. And the Office of Management and Budget – gave us that mega-circular they had been promising for 2 years – CHECK!

That’s a Mouthful!

The new mega-circular, known as Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards, Final Rule, aims to tame the avalanche of  overlapping or contradictory guidance that was previously in effect with the eight separate circulars published by the OMB over a series of many years. These circulars, (including A-133, A-21, and A-110) applied toinformation overload hospitals, institutions of higher education, non-profit institutions, cities, states, tribal organizations, and other types of organizations, and over the years, interpreting the guidance in these documents became more difficult. A working group came together to combine the circulars into one document that would apply to all non-Federal agencies and aim to simplify the process of managing grants and contracts. These organizations worked with COFAR (the Council on Financial Assistance Reform) and the administration to develop new guidance that reflected the current reality of managing Federal awards.

The new guidance was published on December 26, 2013 in the Federal Register, and it’s over 100 pages long. It is well organized, easy to read and search online, and has a lot of familiar information for research administrators. However, in revising and updating the guidance for managing grants and contracts, the Federal government took the opportunity to incorporate input from organizations and change policies and processes regarding grants management.

What You Should Know

Key aspects of the new guidance include the following:

  • Performance over Compliance for Accountability

The emphasis in the new guidance is definitely on generating results and outcomes that can be shared with other award recipients. The Federal government is not going to allow non-compliance, but they do not want overly burdensome rules to prevent an investigator or a collaborating team from accomplishing a stack-of-paperstheir research aims. As you read the guidance, you’ll see that this is the goal.

  • Family-Friendly Policies Encouraged

The guidance definitely encourages organizations that receive Federal funding to develop (if they do not already have) family-friendly policies. They have updated their policies to include family-friendly issues such as costs related to the identification of day-care providers, and the need to allow parents to document  time out of the workforce on their biosketches.

  • Increasing de minimis Threshold for Indirect Costs to 10%

The new guidance allows organizations that cannot afford to negotiate an indirect rate to budget a 10% de minimis indirect rate with the Federal government. Previously the rate was 8%.

  • Administrative Costs can be Charged as Direct Costs

The guidance also provides specific information, in many ways, for the first time, about how to manage administrative costs as a direct cost. This issue can be difficult because it is often charged as an indirect cost (an in most cases it should be charged that way). This guidance correctly acknowledges the need for charging administrative costs as a direct cost and how to manage this situation.

  • Payment Management System Clues 

The circular provides more information than before on ensuring consistency in allocating costs, and when to secure written approval for assigning a cost to an award. The cost principles  and audit sections of the document are very useful, and it states that there is now a limit of three years for the Federal government to review awards in order to disallow costs. This, combined with the new 90 day rule for reporting on awards at the end of the project period gives us an indicator of how the Federal government will be managing award dollars in the future. Can you say “use it or lose it?”

  • Focus on Delivering Results and Outcomes

There is an entire section in the document that discusses how RFAs  and PAs will be written and what must be included in them. The circular states that RFAs and PAs have to be available 60 days before the opportunity closes – which is an interesting development. It will be fascinating to see if the language on “outcomes” and “milestones” translates into a new format for the funding announcements. Stay tuned.

To see a webcast about the new guidance click here.

Here’s to a great start to 2014 – may your New Year be productive and fulfilling!

Be a Spreadsheet Superhero!

h84236603 YOU CAN BE A SPREADSHEET SUPERHERO.

It’s the heart of every budget – the spreadsheet. How it is written and constructed sets the course, not only of the few weeks it takes to submit the proposal – but of the years it takes to manage the project when it is funded. The spreadsheet starts off innocently enough, as a draft that one or two people (usually the PI and the research administrator) work to edit as the proposal is constructed. Carefully planned and well constructed – this can be a time when decisions are made, and documented to set the life of the project off on the right course. Or…not.

CREATING CALM OR CHAOS IN GOTHAM CITY

It’s quite common to learn research administration from the inside out – that is, you join a project mid-stream, and pick up the documentation that a previous team generated for you to work with. That means that your success in helping to administer the research in a department or division depends on the communication that has been left for you by the previous RA, and the internal budgets you’re responsible to manage. It’s more than just written communication – it’s the budget spreadsheets that allow you to help guide your investigators to make decisions about how their projects will be managed in the coming project period.

IT’S A BIRD…IT’S A PLANE….IT’S….EXACTLY THE ANSWER I WAS LOOKING FOR

So how does one become a spreadsheet superhero? It requires some practice and dedication, and a commitment to consistency – knowing that you’ll be serving your investigators long after you leave your position and move on to your next job if you take on this alter ego.

ATTAINING A SPIDEY-SENSE FOR SPREADSHEET SUCCESS

1. Always use formulas and references when budgeting in Excel. Hard enter numbers only when absolutely necessary. Make your spreadsheets work for you, and your investigators.

2. Ask your colleagues for the best budget spreadsheets out there – and if one doesn’t exist (rest assured it does) create one. Find one that works best for your investigators’ applications and use it consistently. Time and date stamp it. Improve it as you use it for each application.

3. Budget based on institutional base salary. If you don’t know what institutional base salary is for your institution, find out. If your spreadsheet doesn’t start or takes you off course from the IBS at your institution, you will be managing cost-sharing on the award if it is awarded.

4. Try very hard to help your investigators to break the habit of doing their own budgets. You can draft them and let them play with the numbers. Many investigators forget elements of budgets – and others don’t understand why certain costs need to be included. In all cases, they need to focus on the science, and that’s why we’re there, to help with the administrative aspects of the application. It’s hard for them to depend on us. Try to help them learn to depend on you.

5. Check your math. Have a colleague review your budget and justification, just to make sure. These things are often developed very quickly and often under pressure. It’s easy to make transposition errors, etc. Have someone with fresh eyes who has had a bit more sleep take a look at your work.

6. Spend a lot of time on the budget justification. Flesh it out for the PI, to help explain the nature of each expense. Include an explanation of the calculations involved if there is a question about how the funds are to be spent.

7. Include the names of individuals working on the project in your budget spreadsheet – even if they are not included in the official proposal documents. Simple details like this are very helpful when administering salary on funded projects.

8. When creating budget spreadsheets, put yourself in the recipient’s shoes – what does the reviewer need to see? Present the budget with that in mind and keep it clean and tight. Present supporting information in sheets behind the summary page of the workbook, linking totals to the summary page. Crowding everything into one page dilutes the information you are providing and adds to the reviewer’s job. (It can also increase the chance of error and cost-sharing.)

9. Use your spreadsheets consistently – for applications, award management (clinical trial tracking, grants management, contract management, salary and effort management, and reporting to investigators). Create roll up reports to identify areas of concern (projected deficits) and manage no-cost extensions prior to them coming due.

10. Create a shared repository for this information for the investigators you work with, as well as the business administration team and central office staff you interact with. As you maintain these records, they will serve to document the active management of your investigators’ activities, help you manage their awards, and hand off their accounts easily to the next person who steps into your role. And that’s customer service!

It’s not easy to keep up with these types of records, especially when things get busy – but its harder not to – especially when there is a need for the information. Take the time to learn Excel well, and share your knowledge and time with your colleagues. Spend the time to develop the systems and processes to support your investigators and develop the spreadsheets that will serve you – and them well – now and far into the future.

How Many People Does It Take To Allocate An Expense To A Sponsored Project?

ideaWhen Your Office’s Cost Allocation Processes  Resemble the Punchline of that Familiar Joke, it’s Time to Take a Look at Your Decision Methods

We recently had a situation in our office where a question was raised about the method of allocating an allowable supply cost to a sponsored project. The supply cost was $30. The “answer” generated more than one week’s worth of discussion involving the time of eight employees in three different offices. In other words, more than $30 worth of F&A was spent on deciding whether or not it could or should be charged as a direct cost on the award. (It was direct charged, and it should have been, it was the right thing to do.)

You’ve Hammered The Nail Down. How Many More Times Do You Need To Hit It?

This is not a discussion about whether or not we want to be compliant – this is a discussion about the BEST way to be compliant. The reality is, that there is often MORE than one way to allocate costs in a compliant manner, and the fact of the matter is that we can allocate costs as effectively as possible, following all the rules and guidelines provided by the funding agency and OMB circulars – and an auditor can still request to remove the charge for a particular reason on an audit. (They may, or may not be successful.) At the end of the day, we need to realize that we are going to make the best decisions possible, according to policies, decide who is responsible for decision making, and move on. So how do we do this, and how can we avoid the black and white thinking that so often comes along with cost allocation processes – and makes the process so PAINFUL and time consuming?

A Starting Place for Understanding Cost Allocation: Three Questions

1. Who decides if the charge goes on the award, and who reviews/approves this decision?

It’s been my experience that the best cost allocation decisions are made at the department level – they are usually initiated by the investigator, and followed up on by a research administrator, who determines how best to allocate the cost to the award – and confirms this with the investigator. The RA might consult with a central office, but a central office role is usually to review and approve the charge once it is placed on the award, and that’s the appropriate role for the central office. It’s good to make sure we’re charging the award appropriately before we’ve touched it – but the local department knows more about the research and how the award is being conducted. The investigator also knows their program officer’s expectations, and grants management officer’s guidelines about how the award should be spent.

2. What information helps guide the decision making process?

The OMB circulars, the award documentation, and the agency guidance regarding allowable costs, as well as institutional policies and procedures regarding cost allocation. Whew! That’s a lot of information that is sometimes contradictory – so where do you start? The most specific guidance for the award pertains first.

3. What documentation supports the decision, and how is this documentation generated and maintained?

There is nothing WORSE than cost allocation processes that are not consistently followed – think A21. Following processes that document purchasing, and the allocation of costs on awards and document these costs consistently so that administrators can follow your thought processes are vital (everything from always using formulas in Excel spreadsheets to entering in justifications to every computer system that you use to execute financial transactions).

Fundamental Knowledge for Successful Cost Allocation

  • The research administrator needs to know the units for accepting costs (this sounds trivial and simple, but it really is quite important). Are costs to be allocated by project, lab, employee, etc?
  • Roles need to be maintained – it is surprising how often central office staff regularly allocate costs to account codes that are inappropriate or feel that they know best how to allocate costs, when they know little about the research itself or the cost item being allocated.
  • The consistency principle for A21 should be (in my opinion) maintained by research unit – similar types of research. Again, this is something that departments know better than central offices – allocation of expenses for wet labs is going to be different than allocation of expenses for dry labs, or clinical research labs. Explaining this to a central office accountant is important to ensure the correct allocation method for the sponsored research account.
  • Allowability and reasonableness are usually easier terms to work through, based on the award information.

When in Doubt – Double Check and Documentgroup-of-small-business-people

If you have a particularly unusual situation, work with your investigator to talk with your central office, and his or her grants management specialist about the question to receive approval. Document the decision if it is favorable. It’s still no guarantee – but it’s a good indication that it’s an allowable cost. Document all of the justification material and correspondence for future reference.

The Best Defense Is A Good Offense

As always, the investigator is always in the best position to support his or her cost allocations when the budget and budget justification are well developed in the proposal stage, and his or her progress reports, financial reports, and updates are well tracked and presented. Our cost allocation decisions should make sense, and be defensible when we are asked about them by our internal and external auditors. And it shouldn’t take a village to allocate the cost of a $30 item to a sponsored project – because there’s more work to be done!

The Pasteur Principle: Using Sponsored Research Best Practices to Prepare for Audits

While attending a conference is an important part of one’s career development, returning from one (and dealing with an overflowing email inbox and the ongoing demands of the workplace) is also part of the deal. Life doesn’t stop while we’re developing new skills – and the continuous requirement to improve, while preparation_mousetrapmeeting the needs of our current job requires the mastery of a micro-vascular surgeon, the decision making ability of a Fortune 500 CEO, and the time management skills of an air traffic controller at La Guardia. Diet Coke, anyone?

I thoroughly enjoyed the intellectual enterprise that was the NCURA Financial Research Administration Conference in New Orleans.  It’s the best conference they offer- hands down, so mark your calendar for next year’s event.

On Monday evening, I’m off to Milwaukee for the regional NCURA conference with my colleague Matt Irwin to discuss the management of clinical research faculty salaries using our salary and effort management tool. But before I do that, I thought I’d recap the presentation that Melody Delfosse and I gave in New Orleans (which is posted in the presentations section for anyone who is interested).

Catchy Title, Anyone?

Louis Pasteur once said, “Chance favors the prepared mind,” and so it is with being prepared for routine and specific program related audits. Our presentation focused on the types of audits (through which my colleague, Melody has capably served our institution for many years). Melody focused on the A133 audit, which is mandated by the A-133 circular to occur on a yearly basis at institutions that receive $500,000 in federal funds. It forms the basis for assessing best practices for sponsored research accounting at institutions that receive federal research dollars. The A-133 also examines how student financial aid funds are managed as well.

A-133 Audit Focus

It’s no surprise that the A-133 audit focuses on key areas of sponsored research accounting that we’re most familiar with:

  • Are the sub-contractors monitored?
  • Are direct costs and indirect costs consistently allocated across all categories?
  • Are direct cost charges beneficial and appropriate to the award?
  • Are cost transfers minimal, and if they are performed, are they timely?
  • Are internal controls present and consistently supporting purchases made on the awards?
  • Is equipment being tagged, logged and managed if purchased with federal funds?
  • Are effort reports and other technical and financial reports produced in a timely manner?
  • Are service centers managed appropriately?

It Takes a Team to Manage and Monitor Sponsored Research Funds

Melody and I then discussed the roles of central, school level and department level research administration staff in monitoring and managing sponsored research accounts – to ensure compliance and bring a sponsored project through the start up to close out process successfully.

Supporting the Investigator throughout the Award Lifecycle

I described the way in which Research Administration Services supports investigators at the Feinberg School of Medicine, a system which forms the basis of best practices for audit preparedness in a clinical research environment:

  • Ensuring accounts are direct charged whenever possible.
  • Establishing mechanisms to build in reconciliation of accounts.
  • Focus on documentation of decisions at every level to support charging.
  • Timely reporting (effort, progress reports, financial reports)
  • Communication (regular meetings with investigators, administrators and contractors)

Two Powerful Tools: Planning for Salary and Effort and Account Tracking

We reviewed two tools that our group uses to assist our investigators to manage their projects and discussed the impact that these tools have had on the departments that have used them on a regular ongoing basis.

Our salary and effort management tool (you can find this under the resources section of this site) is a living document to track and plan a faculty or staff member’s commitments. My colleague Matt Irwin and I will be talking about how to use this tool more in Milwaukee.

Our project tracker is a one year at a time view of a sponsored research project (also under the resources section of this site). Most institutions provide reports to PI’s by fiscal year – this is patently ridiculous when a project overlaps the fiscal year of an institution and has its own “year”. We’ve found that PI’s can’t keep this straight and need their own report. So we made one. This report gives a balance by month, and allows the PI to see all the information they tend to ask about in a meeting. Am I going to run out of money before the end of the year? What if I did X instead of Y? Is so and so getting paid?  It’s all there.

Here’s a Catchy Title: An Ounce of Prevention is Worth a Pound of Cure

We’ve seen it work, but it’s necessary to have a lot of patience for the investigator who needs to receive a top-line explanation about their balance because they don’t understand all the details. Or the investigator with tons of questions because they haven’t gotten a report on anything in a WHILE. The devil IS in the details.

We can’t skip this part, and we can’t skip through it, because this year, the file that gets pulled into the stack by the A-133 auditors could be ours. And as long as the government will be awarding grants and contracts, we will be held accountable for receiving them. That includes the possibility of an audit.

Three Things You Can Do Right Now

  1. Institute regular meetings with your investigators to review accounts.
  2. Review your institutional record retention policies – you’d be surprised at what you’d need to keep and for how long.
  3. Examine your institution’s systems and see where you can capture ways for documenting decisions without extra work (if you’re filling out an online or paper form for purchasing, and usually skip a section that asks for a reason for the purchase – start filling it in).

Keeping Pandora’s Box Tightly Closed: Applying and Managing Clerical and Administrative Costs to Federal Awards

images (2)Some Types of Federal Awards Can Accept Administrative Costs Under Limited Conditions  

After having it drilled into your head that administrative costs are nearly impossible to justify on federal grants, you may be surprised to learn that there are regulations that allow the charging of administrative costs to Federal awards under certain circumstances. However, it is important to review your institutional sponsored research policies regarding the proposal, documentation and administration of administrative costs on federal awards, especially in light of recent audits in this area. I attended a panel presentation today on this subject at the Financial Research Administration conference given by NCURA that was staffed by Attain consultants, and it was an excellent overview on the topic.

Circular A21, section F6B, and Exhibit C provide guidance on the circumstances under which department administrators may consider charging clerical and administrative costs as a direct charge to a sponsored project. The Cost Accounting Standards section 9905.502 supports the assignment of costs using like circumstances, and consistent allocation of costs between direct and indirect accounts.

Section F6B outlines the following requirements:

  1. The sponsored project must be a “major project” which requires an “extensive amount” of clerical support.
  2. The clerical support personnel must be specifically identified with the project activity in the documentation (budget justification and proposal).
  3. The project must specifically budget for the administrative or clerical costs (and de facto receive approval from the sponsor).

Exhibit C specifies the type of project that would be considered a “major project”, which would typically be considered a P, M or U award from the NIH, or a type of award with one or more of the following types of characteristics:

  • A large complex program
  • An award requiring extensive data analysis
  • A scientific award requiring extensive collaboration which includes making travel and meeting arrangements for large numbers of people
  • Projects where investigators are geographically unavailable to usual sources of administration (so administrators have to travel to them).
  • Database management, coordination of multiple investigator projects

Documentation is No Guarantee That Charges Are Approved – But A Budget and Justification Helps A Lot

When considering the application of administrative salary or costs to a Federal award, it is important to plan for these costs during the proposal stage, and consider the documentation of these costs in the budget and budget justification. This is the strongest type of documentation (which ties the costs and supports their justification to the scientific plan at the time of the proposal). When this is not possible, written documentation of the request and approval of the costs with the justification that are submitted to the funding agency, with the written approval should be obtained.

It’s important to name the personnel (the individual, or at minimum, the position title, if you are funding a position or portion of a position) in your budget justification. When you administer this person’s time, their activity report (if they are paid hourly) or effort report (if they are paid monthly) will tie back to the budget and budget justification. And yes – setting up activity reporting or effort reporting that documents their work on the project is a must. Note that hourly employees cannot provide an effort report due to the type of employment that they typically provide on a project.

Careful reconciliation of administrative costs on an award are necessary to ensure that the charges are hitting the correct account codes, and the proper documentation is obtained and maintained throughout the life of the award. Should the award be audited, this documentation will be needed to substantiate these charges.

The panelists noted that despite receiving approval from funding agencies, and maintaining documentation, some Universities have experienced OIG audits on administrative cost allocations and have found that they were required to remove administrative costs charged to Federal grants at the OIG request. The proposal, budget and grants management documentation will establish a reasonable, consistent allocation method between direct and indirect costs, but it does not guarantee that those costs will remain on the account in the event of an audit.

One other note of caution: an audit on administrative cost allocation methods can easily become an audit about your institution’s F&A rate. This is why it is best to be conservative when proposing, allocating and charging direct costs to grants, and why it is important to have strong institutional controls over this process.

Wondering why it’s hard to get a laptop approved on your PI’s proposal? This is why.