The 10 most important guidelines with regards to NIH and MRC Grants, aimed

at Young and Emerging Researchers

Dollars and Rands: Budget Planning pre- and post-award

1. Types of NIH Grant Funding

The following groupings represent the main types of grant funding the NIH provide:• Research Grants (R series)• Career Development Awards (K series)• Research Training and Fellowships (T & F series)• Program Project/Center Grants (P series)• Resource Grants (various series)• Trans-NIH Programs

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• NIH Research Project Grant Program (R01)– Basic Research Grant – Used to support a discrete, specified, circumscribed research project – NIH's most commonly used grant program– No specific dollar limit unless specified in FOA– Advance permission required for $500K or more (direct costs) in any year– Generally awarded for 3 -5 years– All ICs utilize– See parent FOA: PA-13-302

• NIH Small Grant Program (R03)– Small Research Grant – Provides limited funding for a short period of time to support a variety of types of

projects, including: pilot or feasibility studies, collection of preliminary data, secondary analysis of existing data, small, self-contained research projects, development of new research technology, etc.

– Limited to two years of funding – Direct costs generally up to $50,000 per year– Not renewable– Utilized by more than half of the NIH ICs – See parent FOA: PA-13-3043

• NIH Exploratory/Developmental Research Grant Award (R21)– Encourages new, exploratory and developmental research projects by providing

support for the early stages of project development. Sometimes used for pilot and feasibility studies.

– Limited to up to two years of funding – Combined budget for direct costs for the two year project period usually may not

exceed $275,000. – No preliminary data is generally required – Most ICs utilize– See parent FOA: PA-13-303

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2. Budgets and the Review process

One of the important points is in the review process - reviewers are evaluating the scientific and technical merit of the application, scoring the application, and only after the application is scored, do they turn their attention to the budget.

Reviewers and program officials use the budget by essentially evaluating it in the context of a research plan that’s been proposed by the investigator and assessing whether the cost items proposed and the total amount of the budget aligns with the scientific scope of the project that’s being proposed.

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If the review group do recommend budget adjustments, it’s usually on the basis of one of a few things: • that either there wasn’t sufficient justification in the budget

justification for the type of science that’s proposed; • in the future year projected costs there isn’t adequate explanation of

variations in the cost, or• if they do recommend a reduction in the dollar amount or length of

time it could be because they feel that the research can be completed at those lower levels.

After review, the institute and center program and grants management staff also scrutinize budgets very carefully and, in the context of their own allocations, may determine that further budget cuts are necessary. They’ll also be looking closely at any scientific or budgetary overlap that may be apparent and try to resolve those. It’s possible that budget cuts may be made to address those issues.

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3. Budget StructureBudget Category Comments

Salaries and Wages Between 50% and 70% of total application.Base Salary = Total Cost to CompanyFringe Benefits = 0%Salary Requested = Cal. Months x Base SalaryRFA, could stipulate minimum or maximum levels of effort, or even type of personnel

Consultants Services May provide advice, but should not be making decisions for the direction of the research

Equipment Defined as items or property that are over $5,000 in cost and with an expected life of over a year

Supplies Guide: $15,000 to $20,000 per person on the projectFully justified per category, e.g. Stationery & Printing; Laboratory Supplies, etc.

Travel Costs Make use, as far as possible, of US Flag CarriersCover travel costs for attending directly related meeting, conferences and workshop to this specific application/research

Other Costs Publication costs, Communication (Tel/Fax/Internet)

Consortium/Contractual Cost Total Costs, include a copy of detail budget and budget justification

Total Direct Costs

Federal F&A Costs 8% for all Foreign InstitutionsF&A Base = Total Direct Costs Less Equipment

Total Costs

Between 22% and 42% of total application!

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4. Budgeting Pit falls to AvoidRand:Dollar Exchange Rate

R01 Grants: Rule of Thumb - Use an 5 year average rate, i.e. R8,2222:$1 and not the current prevailing rate of R10.2:$1. Using the prevailing rate can and will result in the project being under funded if the Rand appreciates below the R10.2 mark.

E.g. Total Rand required for Project R100,000 converted to $s at R10.2 = $9,804. If awarded at this Budget rate (R10.2) and the rand appreciates to R9, this will result in a loss of R11,764 ($9,804 x R9 = R88,236). Awarded at $9,804, claim (via PMS at a future rate of R9, means that you can only claim a reimbursement for expenditure incurred to a max of R88,236.If you used the 5 year average rate of R8.2, your award would have been $12,195. If awarded at this Budget rate (R8.2) and the rand appreciates to R9, this will result in a surplus/additional rands of R9,756 ($12,195 x R9 = R109,756). Awarded at $12,195, claim (via PMS at a future rate of R9, means that you can only claim a reimbursement of expenditure incurred to a max of R109,756.8

Rand:Dollar Exchange Rate

NIH Policy: Expenses are converted to $ on the day you prepare the claim for the drawdown on PMS.

R03 & R21 Grants: Rule of Thumb - Use a 3 to 4 year Average rate, (max 2 year award).

Using a conservative (x year average rate) means that your Rand Budget is smaller, but that you will be able to complete the study within budget, because you have already trimmed your budget in the proposal stage to the minimum and know that it is sufficient to conduct the research.

All NIH RFA’s stipulate a 0% inflation or max of 3%, the only way to fund inflation is by using a conservative exchange rate to set your Budget/Contract Rate.

Your institution will have it’s own internal policies on the appropriate rates to use, consult your Finance Manager.9

5. Grant Award Basics

• **************** NOTICE OF AWARD*******************

CENTER GRANT

Issue Date:06/24/2010

•Department of Health and Human Services

National Institutes Of Health

• **************** NOTICE OF AWARD*******************

CENTER GRANT

Issue Date:06/24/2010

•Department of Health and Human Services

National Institutes Of Health

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Read the Notice of Award Read the Notice of Award

• Terms of Award – Section III– 45 CFR Part 74 or 92 - HHS rules and requirements

that govern the administration of grants– NIH Grants Policy Statement (GPS) – policy

requirements that serve as the terms and conditions of NIH awards (latest version 10/01/13)

– Program legislation– Appropriation acts– Program regulations

42 CFR Part 52 - Grants for Research Projects

• Special Terms and Conditions – Section IV11

Award Restrictions(Section IV)

• Only applied to a particular grant for cause• Shown on the Notice of Award (NoA) after Section III –

Institute and/or Center specific terms of award• Funds usually are not restricted in the Payment Management

System • Restricted funds must be tracked by grantee to ensure

compliance

– EXAMPLE of Award Restriction: Funds may not be used to purchase equipment without the written prior approval of the NIH awarding component.

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6. Financial Reporting

Federal Financial Report (FFR)(SF-425)

Expenditure Data

• Timely - Must adhere to submission deadlines:– Annual – (Non-SNAP Awards)

FFR submitted for each budget period no later than 90 days after the end of the calendar quarter (CQ) in which the budget period ended.

Budget period ends 1/31/2011 – FFR due 6/30/11

(90 days after the end of the CQ of 3/31/11)

– Final (End of Competitive Segment) – (SNAP and Non-SNAP Awards) FFR submitted within 90 days following the end of the project period

(SNAP – Streamlined Non-competing Award Process)13

Financial Reporting (cont.)

• FFRs should be submitted accurately

• Reported expenses and program income must agree with institutional accounting records

• Routine Revisions to correct FFRs are not appropriate

• Any revisions must be submitted in the same format as the original submission.

For example: If the original report was submitted as a Financial Status Report (FSR)(SF-269), the revised report

must be submitted as an FSR. 14

Closeout: Final Reports

• Failure to submit timely final reports may affect future funding to the organization

– Final Federal Financial Report (FFR) SF-425 Expenditure Data– Final Invention Statement and Certification – Final Progress Report

• Final Reports are due within 90 days of the end of grant support.

• Grantee must ensure there are no discrepancies between final FFR expenditure data (in eRA Commons) and FFR cash disbursement data in the Payment Management System.

April 2, 2008, NIH Announces New Centralized Processing Center for Receipt of Grant Closeout Documents and Reminds Grantees of Required Closeout Reports for NIH Assistance Awardshttp://grants.nih.gov/grants/guide/notice-files/NOT-OD-08-061.html

June 17,2005, NIH Announces New Closeout Feature in the eRA Commons and Reminds Grantees of Required Closeout Reports for NIH Assistance Awards

http://grants2.nih.gov/grants/guide/notice-files/NOT-OD-05-051.html

Reminder

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7. Carry-over of Funds & Re-Budgeting• Requests for carry-over of funds should be

signed by Authorized Representative.• Request must be sent to GMO and include:

– Detailed budget by direct cost category with F&A cost information (base and rate). If personnel costs are requested, include a detailed breakdown of personnel costs base salary salary requested effort to be spent on the project

– A scientific justification for the use of funds– The reason for the unobligated balance 16

A Rule of Thumb General Rule: 25% Change in Budget or Change in Key

Personnel, could indicate/result in a change in scope which could require prior approval.

Whenever you are contemplating a significant post award change, and you are uncertain about the need for prior approval, consult in advance with:

• The Notice of Award (terms and conditions)• Your Office for Sponsored Research/Projects• NIH awarding component Grants Management

Officer/Specialist (GMO/GMS)17

8. Audits

Audit Requirements– Foreign Institutions: A-133 Audit required if,

during its fiscal year, the organisation expends $500,000 or more in HHS Funding (Direct and Indirect Awards).

– Covers: Financial management systems Procurement systems, incl. expenses verification Time & effort reporting systems Monitoring activities Adherence to terms & conditions of award

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South African Medical Research Council (MRC)

9. Budget Tips

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9. MRC Budget Tips

• Young and Emerging Researchers– Do not ask for a very large grant,– Demonstrate that you can complete a good small project for a

relative smaller amount of money,– Build a goog track record before applying for larger grants.

• Use the official MRC Application format and forms.• Include all other sources of funding for the proposed study,

e.g. NIH, DST, Departmental Grants etc.• Provide a justification for all categories of funds requested.• Reviewer can recommend Budget Cuts, similar to NIH

reviewers.

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DON’T FORGET

• Confirm the submission method: Electronic vs. Hardcopies;

• Due Date for Applications – remember to factor in your institutions Approval and Review lead times;

• Exchange Rates:– Budget Rate used becomes your Contract Rate– Contract Rate ≠ Claim Rate !!!

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Resources• Desmond Tutu HIV Foundation (DTFH) http://www.desmondtutuhivfoundation.org.za/

• National Institutes of Health (NIH)http://www.nih.gov/

• NIH Grant Policy Statement (GPS)http://grants.nih.gov/grants/policy/nihgps_2013/

• South African Medical Research Council (MRC)http://www.mrc.ac.za/

• Oandahttp://www.oanda.com/

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