FINANCIAL CLOSEOUT – POST AWARD

FRA VII conferenceconference

Financial Research Administration Conference

Enhancing the Partnerships April 2-4, 2006 • La Quinta Resort & Club • La Quinta, CA • Palm Springs

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Session Presenters

Tami SaduskyDirector, Grant and Contract AccountingUniversity of Washington

Kim GarrisonAssociate Director, Research ServicesUniversity of Pennsylvania

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Session ObjectivesIdentify central and departmental issues that

delay preparation of financial reporting and closeout

Discuss best practices to minimize delaysShare examples of closeout procedures and documentsDiscuss central and departmental best practices work plan that addresses closeout

requirements

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The Closeout Process

When should the closeout process begin?

You should start while the grant is still active!

Conduct regular review of account status!!

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Department Administrator Role

Assist PI in compliance with regulations and policies

Monitor expenditures of award funds

Obtain necessary signatures/approvals

Coordinate with central offices on reporting

Assist central administration with closeout and audit activities

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Common Departmental Issues

Untimely response to request for information & documentationIncomplete documentation and approvalMisunderstanding of financial closeout requirementsLack of regular communications between investigators and administrators Not conducting timely (e.g., (monthly) review of project expensesLack of adequate cost share documentation

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Common Central Adm Issues - 1

Noncompliance with sponsor reporting requirementsUntimely processing of close-out adjustmentsLack of adherence to terms and conditionsLack of timely response to departmental request for approvals, e.g., allowable costs, cost transfers, rebudgeting

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Common Central Adm Issues - 2

Delay in collection of receivablesDelay in requesting closeout documents

Termination NoticesRelinquishing StatementsFinal Invention statementsProgress reportsProperty reportsSubcontractors Release Forms

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Common Central Admin Issues - 3

Unusual reporting requirements Unusual and very detailed expenditure reporting and documentation required Types of reports required may not be clear

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Best Departmental Practices to Minimize Delays - 1

Communication Begins at the proposal stage Continues throughout the life of the project Include:

• Principal Investigators• Departmental Administrators• Pre and Post Award Administration Offices• Other Central Offices• Sponsors

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Best Departmental Practices to Minimize Delays - 2

Items to be communicatedApprovals for rebudgeting and carryoverNeed for extensions and status of renewalsIssues such as overspending, non-compliance with budget or award termsDelays in meeting deliverable or technical report deadlinesChange in scope or effort of key personnelIssues concerning non payment of invoices

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Best Central AdministrationPractices to Minimize Delays - 1

Review agreements and sponsor policies and procedures thoroughly prior to

sending department inquiriesInitiate communication prior to reporting or

closeout deadlinesChecklist or email to departments with specific due date Indicate course of action if non-compliant

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Best Central AdministrationPractices to Minimize Delays - 2

Review accounting transactions for allowabilityReview accounting transactions for complianceReview for proper signaturesAdvise departments on financial matters

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Department/Central Administration Shared Responsibilities

Stewardship and accountabilityEffective management of public and private fundsUnderstand each other’s roles and responsibilitiesUse a team approach to resolve issues

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Grief Relief/Guilt Check - 1

What causes departments the most grief in preparation for closure?Are these self inflicted problems and, if so, what

can be done?Examples:

Follow up on extensions/supplements requested and not yet received

Verify proper charging of trainee expendituresEnsure patient care costs are appropriateFollow up on final subcontract expenditure

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Grief Relief/Guilt Check - 2

More examples:Reconcile travel advancesEnsure tuition charges are appropriateDetermine all participant support costs have been chargedIdentify and reconcile all noted restricted budgeted categoriesReview charges incurred after expiration dateLiquidate encumbrances as necessary

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Grief Relief/Guilt Check - 3

Even more examples:Review and, if necessary, transfer outstanding obligationsReconcile cost sharing & faculty effortDetermine program income revenue andexpenditures are appropriateComplete & submit statement of trainee appointment formsResolve deficitsObtain information from other departments for interdisciplinary awards

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University of WashingtonReconciliation & Closeout Process

Notice of Expiring Budget (See Attachment A)

Responding to the Notice of Expiration Letter (See Attachment B)

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University of Pennsylvania Central Office Reconciliation & Closeout Process

Run reports to identify reports dueInitiate courtesy email to responsible departmental administrator prior to financial report due datePerform summary review of expense for allowability, allocability, & compliance with sponsor & university policiesRequest information, documentation, verification, and indicate a response time

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University of Pennsylvania DepartmentalReconciliation & Closeout Process

Maintain documentation for filesRun reports to identify interim and final due reportsPerform final review of expense for errors, allocability, allowability, reasonableness & relevant

sponsor & university policies prior to end of reporting periodInitiate email to Central Office accountant regarding

information, documentation, verification necessary for reporting & closeout

Indicate course of action and time frame

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Closeout Process Impact

Who else impacts the process?SponsorsPre Award OfficePost Award OfficeAccounting/PayrollAccounts PayableService Centers

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Federal DemonstrationPartnership FDP Update

Simplification of reporting Examples:

Combining SF-269 and SF-272Elimination of F&A detailElimination of cumulative cost sharing column

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Final Notes - 1

The end of a project does not mean the end of our responsibilities

Each institution has sponsor requirements to meet before a final closeout of the project is

completed

Good project management during the active live of an award will assist in eliminating

problems after the award has ended

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Final Notes - 2

RecommendationsOn a regular basis review project expensesMaintain proper documentationProvide timely communication between PI’s, departments, sponsors, and central officesProvide tools to assist in closeout reviewDevelop institutional sponsored projects policies to assist in communicating and enforcing closeout proceduresProvide compliance and closeout training for PI’s, central and departmental administrators

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Resources

NIH Grants Policy Statement http://grants.nih.gov/grants/policy/nihgps

NRSA Frequently asked questions http://grants.nih.gov/training/faq_training.html

NIH T32 announcement, NIH guide http://grants.nih.gov/training

OMB circular A-21(Cost Principles)http://www.whitehouse.gov/omb/circulars/a021/a21_2004.html