Grants Compliance from an Agency Perspective Governors Grants

Grants Compliance from an Agency Perspective Governor's Grants Office Higher Education Conference Bowie State University May 22, 2012

Ask Early, Ask Often • Jeremy Leffler – Outreach Specialist, Policy Office – Division of Institution & Award Support – Office of Budget, Finance & Award Management – jleffler@nsf. gov; 703. 292. 8075 – Email general policy questions to: policy@nsf. gov

NSF Organizational Chart National Science Board (NSB) Office of Cyberinfrastructure Office of Diversity & Inclusion Director Deputy Director Office of the General Counsel Office of Integrative Activities Office of International Science & Engineering Office of the Inspector General (OIG) Office of Legislative & Public Affairs Office of Polar Programs Biological Sciences (BIO) Social, Behavioral & Economic Sciences (SBE) Computer & Information Science & Engineering (CISE) Education & Human Resources (EHR) Engineering (ENG) Geosciences (GEO) Budget, Finance & Award Management (BFA) Mathematical & Physical Sciences (MPS) Information & Resource Management (IRM)

Office of Budget Finance & Award Management (BFA) Office of Budget, Finance & Award Management Division of Acquisition & Cooperative Division of of Institution of Budget Financial Grants Division & Management Agreements Award Support Systems Office Policy Office Cost Analysis Policy Clearance Outreach

Accountability & Transparency • Drivers • Current Landscape • Desired Outcomes

History and Timeline 1999 2004 2005 • Grants Policy Council (GPC) • Grants Executive Board (GEB) • Grants Management Line of Business (GMLo. B) • Federal Funding Accountability & Transparency Act (FFATA) 2006 2011 • Committee on Financial Assistance Reform (COFAR)

COFAR – Goals • Minimize risks of waste, fraud, and abuse of Federal funds • Minimize administrative burden for recipients and agencies

COFAR – Organization • OMB Comptroller (Co-Chair) • Eight Federal agencies – – – – Department of Agriculture Department of Education Department of Energy Department of Health & Human Services (Co-Chair) Department of Homeland Security Department of Housing & Urban Development Department of Labor Department of Transportation • Rotating agency – National Science Foundation

OMB – Federal Register Notice • Published in February with comments due April 30, 2012. • Requesting public comment on reform ideas • Reforms highlighted focus on three areas: – Reforms to audit requirements; – Reforms to cost principles; – Reforms to administrative requirements.

Award Monitoring and Business Assistance at NSF

NSF Award Portfolio • • $25. 5 billion in total award funding 42, 192 active awards – Standard and continuing grants – Cooperative agreements – Graduate research fellowships – Other awards • 3, 197 awardees – Universities / 4 -year colleges – Non-profit organizations – For-profit organizations – Community colleges – Other awardees Award information as of July 2, 2010

• Comprehensive Monitoring Activities • Tracking Monitoring Results and Gathering Feedback Ris As k ses sm • Risk Assessment ing or nit ies Mo tivit Ac The portfolio monitoring strategy contains three key components ent Risk-based portfolio monitoring strategy Feedback

NSF Annual Risk Assessment Risk Adjustment Criteria NSF Award Portfolio Risk-Based Award Ranking Category A ~7% of Awardees Risk Points ≥ 32 Total Obligation > $500 K Risk-based Awardee Ranking 42, 192 Awards Ranked by risk points Awardee Risk Categories 3, 197 Awardees Ranked by risk points 11 2 3 Category B ~23% of Awardees 16 -32 Risk Points Total Obligation > $500 K Category C Risk Adjustment Screens 1. Institutional factors 2. Prior monitoring activities and results 3. Award administration and program feedback From Awards To Awardees ~70% of Awardees NSF not Cognizant Risk Points < 16 or Total Obligation < $500 K Prioritize monitoring based on: - Highest risk points - Highest dollars - Number of awards

Increasingly focused and targeted NSF Monitoring Activities Site Visits BSRs Advanced Monitoring Desk Reviews Federal Financial Report (FFR) Transaction Testing Grants and Agreements Monitoring Baseline Monitoring Automated Report Screening Percentage of Portfolio Category A Category B* Category C * Category B selected for advanced monitoring on resource-available basis

Award Monitoring: Site Visit Targeted Review Areas • • • • ARRA Review Consultants Cost Sharing Final Project Reports Fringe Benefits Indirect Costs Participant Support Costs Procurement Program or Award-Related Income Property and Equipment Special Terms & Conditions Subawards and Subrecipient Monitoring Time and Effort Records Travel

Top Compliance Issues Identified in NSF Business Assistance Program • Time and Effort – Written policies and procedures – Time and effort documentation system – Inclusion of administrative support labor costs as direct charges to NSF awards

Top Compliance Issues Identified in NSF Business Assistance Program • Subawards and Subrecipient Monitoring – Inadequate pre-award documentation; – Missing subaward agreement; – Judgmental nature of adequate monitoring

Top Compliance Issues Identified in NSF Business Assistance Program • Participant Support Costs – Failure to properly document that funds have only been expended for these budgeted costs; – Lack of written policies and procedures for documentation; – Failure to document attendance of participants; – Not tracking costs in separate accounts

Keys to Success for Awardees • Know the requirements (award letter, award terms and conditions, OMB Circulars) • Good accounting practices – accumulation and segregation of costs • Focus on the objectives of the project/program • Document approvals and conversations between awardee and NSF • Ask Early and Ask Often!

Ask Early and Ask Often! • Policy Office – policy@nsf. gov – 703. 292. 8243 • Cost Analysis & Audit Resolution – bfadiascaar@nsf. gov – 703. 292. 8243