TRAC & FEC
Martin Jamieson
January 2007
INDEX
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TRAC processes
TAS
Research Project FEC costing
Proposed changes to processes.
When FEC is NOT used.
Estates and Indirects + Distribution Policy
Interpretation of Management Accounts
Research Administration issues.
TRAC and Teaching
Glossary of Terms
- FEC – Full Economic Cost – this requires
that all of the costs of the research project
are calculated.
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DA – Directly Allocated Costs
DI – Directly Incurred Costs
Indirect Costs
Exceptional Costs
- FTE – Full Time Equivalent – defined as
1650 hours pa (or 37.5 hours per week for
44 weeks)
- TAS – Time Allocation Schedule
- TRAC – TRansparent Approach to Costing.
Nomenclature
• INDIRECTS - used to be the main
source of financial contribution from
Research projects (plus some salary
recoups).
• CONTRIBUTION – is the new term – it
incorporates Salary Recharges (now
also on Academic staff), Estates, &
Indirects
TRAC Process
TRAC Process
Statutory Accounts
TAS
PLUS 2 ADJUSTMENTS
TRAC
Statutory Accounts
PLUS 2 ADJUSTMENTS
University
Services Cost Drivers
TAS
Estates
Occupant, m2
Department Costs
Teaching Research
Other
University Services – Cost
Drivers
Statutory Accounts
plus 2 adjustments.
University
Services Cost Drivers
TAS
Department Costs
Teaching Research
Salaries – TAS
Non-Salaries
Estates – Occupant, m2, activity
Indirect – Support (TAS)
- US
Estates
Other
Statutory Accounts
2005/2006
TRAC
January 2007
Department Costs
Research FTE rates for Estates and Indirects
-Applications from February 2007
- Projects may start from February 2007, but
it could be late 2008 before they start.
TRAC Return
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Costs for 2005/2006
Reported in TRAC return Jan 2007
Used in Applications Feb 2007 – Jan 2008.
Award may be six months after application.
Start date may be three months after the award.
Estates and Indirect costs are indexed for two years
to bring them up to date for the start of the project.
• These rates are the year zero rates – and the FEC
cost will be adjusted for inflation for the rest of the
project life.
Time Allocation Schedule
(TAS)
TAS
Project Costing
Research Project FEC Costing
• PI plans project and identifies resources
required.
• R&E help by calculating FEC costs for
project (FEC FTE Rates calculated from
staff time)
• PRICE – calculated from costs or based
on market (depending on funder).
Resources
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New RA1A for three years
PI time 15%
Technician 10%
Consumables15,
Equip 5,
Travel 2
Contribution
• The contribution equals the PRICE paid
by the funder less the marginal cost to
the University of undertaking the
research. (Typically the marginal costs
equals the Directly Incurred costs that
the PI manages.)
• PRICE – DI = CONTRIBUTION
Avoid Double Counting
• Do not charge a cost directly if it has
already been included in your indirect
cost rates.
• General Funds staff will have been
charged to Research or indirect costs
based on their TAS return.
• Time spent on support will result in
costs being allocated as Indirect costs.
Proposed Changes
Proposed Changes
• It is recommended that we split the DA
Technical salary costs:
– Named DA - Technician salary costs – this
element will need to be justified and will be
considered by peer review committees.
– DA -Pool Technicians – these should be
calculated as a rate per Research and
Teaching staff time, not subject to peer
review.
When FEC is used!
• GENERAL RULE – All Research and Other
services projects should be costed on a FEC
basis.
• Exceptions:
– Travel Grants – the FEC value should be made
equal to the Price Awarded.
– Equipment Grants – FEC = PRICE
– Studentships – RCs fund stipends, fees and
RTSG, but will not pay for supervision, Estates or
Indirects.
Estates and Indirects
• Each year each Faculty gets a charge for all
of its share of Estates and Indirects.
• Across the breadth of its activities the Faculty
must generate sufficient contribution to pay
for Estates and Indirects.
• All of the financial contribution from each new
research project comes to the Faculty.
SENSITIVE TO VOLUME
• The budget assumptions on the volume
of research will determine the planned
net contribution.
• An increase in volume (more projects
than planned) will increase the
contribution. (Gross cont = Net Cont
because the corporate overheads do
not increase.)
Distribution Policy
• Constrained by Faculties financial position.
• Recommend distribution as a percentage of
contribution (rather than variable rates for
each of Salary recharges, Estates and
Indirects).
• Consider distributing a lower % during the
year with the balance on a T-1 basis to allow
the Faculty to ensure that it balances its
books, before being more generous.
Interpretation of Management
Accounts
Management Accounts
• Management Accounts Example
Research Administration
Issues
Research Changes
• System Changes:
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Agresso upgraded
FEC introduced
Research system updated
HR system updated
• Volume of work increases in R&E and ROSS
• Staffing:
– tried to absorb increases in work with no new posts.
– ROSS – have twelve grade 4 posts – 6 of whom have been
appointed during the last year. We have a very good team
and the new appointments are settling in very well.
Research Administration Issues
• Data Quality – accuracy of PAF and data in
both the Research System and Agresso.
• Modernisation of Pay
http://www.gla.ac.uk/services/finance/staff/res
earch/index.htm
• Notification of staff starting on a project must
be within 28 days (PMF for new staff or email
to ROSS for projects that only involve salary
recharges) Notification of students starting.
http://www.gla.ac.uk/services/finance/forms/fo
rmsindex.htm#QT
PRICE Budget on THE Research system should equal:
award letter, and
Y/N
PAF Page 3
Y/N
FEC budget on the Research System should equal the PAF –
Y/N
handwritten changes should be dated and signed. If there are
more than one set of changes, then please print a new PAF and
provide an explanation.
All FEC projects must include the PI and Co Investigator time and
Y/N
cost in the FEC column on the PAF (whether or not the funder
will pay for these costs). Therefore all FEC projects MUST
include Estates and Indirect costs (for all eligible project staff).
VAT input - Yes or No
Y/N
VAT No If sponsor is within the European Union
Y/N
Invoice Arrangements/ Payment Terms
Y/N
All contracts must be signed
Y/N
Purchase Order Number
Y/N
Research Admin Issues cont.
• R&E – advice on justification of resources
FEC Justification of Resources.doc
• R&E – costing requisition form. Costing
Request Form.xls
• Author Pays Publications – costs need to be
included in applications (rate varies from a
few hundred £s to a few thousand £s) Author
Pays Publications.xls
Streamline Research
Administration
• Need to simplify:
– calculation of project costs, budgets etc
– Reduce duplication in data input - transfer data
between systems
– Reduce duplication in authorisation – e.g. HR
PMFs and PAF
– Select administration processes that will simplify
things for the PI – e.g. give them a budget = to
the FEC value of the DI costs.
– RPSG about to form working group.
TRAC Teaching
TRAC - Teaching
• TRAC was focussed on research but is
now being widened to look at teaching
in more detail.
• Voluntary return in Feb 2007.
• Benchmarking – spring 2007.
• Compulsary return Feb 2008.
Teaching Return
• Cost of Publicly Funded teaching/FTE per
HESA cost centre (department).
• Expect that the 2008 return will be the first
with more meaningful information.
• What management information do we need?
• What will we need? – e.g. in one or two years
as the SFC complete their review of FE and
HE teaching.
Actions
• New collection of staff time information.
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Decide what info. we want.
Design new form
Agree statistical sampling method.
MIS update web-program
Collect from April 2007.
• Ask HoDs to validate data.
• Compare with 2004/2005
• Generate annual equivalent data from new
return.
ROSS Contact Details
• finrossec1@mis.gla.ac.uk ENGN, FIMS,
IGR, PHSC, RCBS
• finrossec2@mis.gla.ac.uk IBLS, VETS
• finrossec3@mis.gla.ac.uk Medicine
• finrossec4@mis.gla.ac.uk Rest
• finrosseu@mis.gla.ac.uk EU & Federal
Martin Jamieson
University of Glasgow
m.jamieson@admin.gla.ac.uk