Research Accounting
Challenges
Part 1
Canada Foundation
for Innovation
Cash Flow Projections
CFI requires that institutions monitor and report
significant variances in cash flow projections.
As part of the annual review and financial reporting process,
institutions usually analyze the cash flows with that of the original
projections for each project. CFI will indicate when this should be
done more frequently, especially for large, complex projects.
Challenge:
Given our limited resources, how do we adequately review and
project cash flows, and report variances for the projects that require
more frequent monitoring (i.e. large LEF projects with significant
construction/renovation component and possibly several institutional
partners)?
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Cash Flow Projections
CFI
Guideline
Objectives
Significant
Variance
 Notify CFI of significant variances in
projected cash flows
 Timely notification
 Progress monitoring
 Proper instalment schedules
 Timing of expenditures from one fiscal
year to the other deviates by more than
20% of total eligible costs, OR > $500K
 No need to report variances < $100K
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Cash Flow Projections
Good practices:
 Realistic timelines upon award finalization
 Project leaders and administrators informed of
requirement
 Risk-based approach to monitoring
 Review of current status as well as timeline for
completion
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Construction/Renovation
CFI requires that institutions provide an adequate costing
analysis for each renovation/construction project.
Challenges:
•
Engaging the Facilities Engineering department
•
Added complexity when part of a larger undertakng
•
Added time and costs of this analysis because architects,
design engineers, project engineers are involved
•
Simplified vs detailed approach
•
Reporting of significant changes in nature and amount of
space constructed/renovated
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Construction/Renovation
CFI Guideline Request prior approval for
significant change in nature and amount of
space constructed/renovated
Objective
Assess impact of significant changes on
project
Significant
Variance
 Net increase or decrease in total amount
of space > 10%
 Cumulative amount of space where
change in nature > 10%
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Construction/Renovation
Cost Allocation Methods
Is the average cost of the CFIfunded space representative
of the average cost of the
overall undertaking?
Yes
Simplified method
or
Detailed method
No
Is the average cost of the
CFI-funded space higher
than the average cost of the
overall undertaking?
Yes
No
Is the average cost of the
CFI-funded space lower than
the average cost of the
overall undertaking?
Yes
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Detailed method
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Infrastructure Operating Fund (IOF)
Challenges:
• Are researchers given access to his/her proportionate
share of the IOF? (varies at each institution –
politically charged)
• Monitoring expenses for eligibility
• Obtaining documentation from researchers (contract
letters and job descriptions of technical staff)
• Facility charges (utilities, maintenance, etc.)
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Infrastructure Operating Fund (IOF)
 Overall review of the IOF
 Revised guidelines (March 2008)
 Salaries of highly qualified personnel
 Under consideration:




Different model for requesting funds and reporting
Simplified method for facilities charges
Reduced reporting requirements
Templates for personnel costs and facilities
charges
 Fall 2008 - Revised guidelines
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Contribution Audits
CFI requires a contribution audit for each
project with a CFI contribution in excess of
$4M.
Challenges:
 audit intensive funding program
 effort to prepare
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Contribution Audits
 Objective of contribution audits
 Revised audit approach

Increase focus on projects and areas of greater risk
Increase of threshold for automatic audit to $10M

Expected overall decrease in audit activities.

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Update of Itemized List
CFI requires that institutions request approval to
make changes to the itemized list and to report any
significant variances as the project progresses.
Challenges:
•
approved changes to itemized list are not reflected in
annual or financial report, therefore the variances are
not accurate, requiring explanation
•
updated itemized lists are not available on the CFI
website
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Update of Itemized List
Amendment module under development:
 Electronic submission of amendment requests
 Updated Itemized List available to institutions
 Updated information to carry forward to
financial reports
 Fall implementation
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Timing of Competitive
Bidding Process
CFI requires that all equipment purchases
and construction contracts be competitively
bid prior to the submission of award
finalization documents.
Challenges:
• Quotes expire and need updating
• Evolving technology
• Effort of purchasing staff, workload
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Timing of Competitive
Bidding Process
Revised Guidelines
Fall 2008
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Part 2
Federal Granting
Agencies
Salary Limits
The Tri-councils require that salaries/stipends paid
to students and post-doctoral fellows are within
agency limits (minimums and/or maximums)
Challenges:
•
•
•
Notices to researchers and department staff who complete
payroll forms – ongoing training and reminders
Monitoring process to ensure compliance (system reports or
random sampling?)
If receiving a Post-Graduate Scholarship, student cannot also be
paid from a Tri-Council award – monitoring with system reports?
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Salary Limits - NSERC
Maximum Salaries or Stipends from Grants (including
Institutional non-discretionary benefits)
- Masters’ Students – $16,500/year
- Doctoral Students – $19,000/year
Minimum Salary or Stipend from Grants (including
Institutional non-discretionary benefits)
- Postdoctoral Fellows – 25,000/year
- Support limited to 2 years
- 3 years for foreign students if well justified
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Salary Limits - SSHRC
Maximum Stipends from Grants (including Institutional
non-discretionary benefits)
- Masters’ Students – $12,000/year
- Doctoral Students – $15,000/year
- Postdoctoral Fellows – 31,500/year
Salaries to students and postdoctoral fellows must be in
accordance with the salary scale of the Institution.
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Research Time Stipends (RTS)
Institutions must ensure the 50/50
matching of SSHRC funds is fulfilled
and documented.
Challenges:
•
Obtaining confirmation of RTS and matched funds
from the Department office, along with supporting
documentation
•
Tracking the RTS over the period of the award
•
Sub-granting RTS funds to co-applicants
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Research Time Stipends (RTS)
Both SSHRC and the grant holder's institution share the
financial responsibility for the grant holder's or team
members' release from teaching. SSHRC funds up to 50
per cent of the actual cost of release time.




SSHRC portion must be matched by the institution
RTS may be carried forward to future years, but must be utilized
during the period of the award
Residual funds must be reimbursed to SSRHC at the end of the
grant
Institutions must have a monitoring process in place that
confirms use of RTS and matching funds
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Certifications (Human, Animal, Biohazard)
As per Schedules 2, 3 and 13 of the MOU, institutions must
ensure that the appropriate certifications are in place prior to
the release of the initial and subsequent installments.
Challenge:
•
•
•
Historically, institutions have relied on researchers to ensure that
the proper certifications were in place throughout the award
period, and now institutions must have a process to ensure the
certifications are in place each year of the award.
Certification offices track their certifications by research protocols
and not by funding source or account.
Certification offices will have to adjust their process to now report
certification approvals to the researcher and the Research Office
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Certifications (Human, Animal, Biohazard)
MOU Schedule 2 – Research involving humans
MOU Schedule 3 – Research involving animals
MOU Schedule 13 – Research involving biohazards (new)
 The Tri-Councils expect that all research with human subjects,
animals or biohazards is conducted with continued proper
certification, e.g. initial, annual renewal and in-principle process
(N.B. annual renewal requirement limited to research involving
humans and animals)
 In most cases, initial certification is always obtained
 Institutions must have a process in place to track and confirm that
the research has been approved by the appropriate ethics
committee, prior to the release of funding.
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Delegation of Signing Authority
The Tri-Councils require that only the
researcher or their authorized delegate can
approve expenditures applied to his/her award.
Challenges:
•
Ensuring that the researchers keep their list of
authorized delegates up to date
•
Significant effort to ensure this is completed on a timely
basis
•
Encouraging the internal operating units to use the list to
verify approval to spend (Bookstore, Machine Shop,
Chemistry stores, Computer store, Graphics, etc.)
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Delegation of Signing Authority
“No one may initiate or authorize expenditures from a grant account
without the Grantee's delegated authority.”
Expectations:

Only the PI and their authorized delegate can approve
expenses.

Delegation must be documented and used to verify
expenditures.

There must be a formal process to maintain and update the
listing of authorized delegates.

The institution is responsible to ensure that the person signing
has been authorized by the PI and not by someone else (e.g.
Department Head, etc.).

This is a shared responsibility between the PI and the institution.
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Supporting Documentation
The Tri-Councils expect that the supporting
documentation will allow them to assess the
eligibility, relationship and reasonableness of
the expense to the project.
Challenges:
•
Retaining documentation at the department level
•
Travel documentation (prospectus and purpose of trip, boarding
passes, one-over-one approvals, traveler’s affiliation to grantee,
original receipts including travel ticket, separate claim for each
trip)
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Supporting Documentation
• Agencies require that sufficient supporting documentation is
obtained for all expenditures charged to research grant accounts.
Common Challenges:
• For travel expenses, one over one approval from the department
head or dean is required to attest to the relevancy of the travel
expenses to the research
• If documentation is lost or unavailable, a written statement should be
included with the claim
• Journal vouchers must be adequately documented
Supporting documentation requirements can be found in the TriAgency Financial Administration Guide.
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Monitoring Visits
 Agencies visit 8-10 institutions per year
 Since 2002 have monitored 54 institutions and tracked 93% of
granted funds
 In 2008 will monitor 12 institutions in 6 provinces
Objectives:




To review the adequacy and effectiveness of policies, controls and
systems in place;
To review the expenditures to ensure that the funds are used in
accordance with relevant agency rules (NB the review of the
transactions is based on compliance with Tri-Agency requirements)
To assess whether Grant Holders have the necessary
administrative/financial support from the institution
To share and disseminate information and expectations
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MOU Phase II
Schedule 9: Transfer of Funds from a Primary
Institution to a Secondary Institution
Schedule 10: Confirmation of Eligibility
Schedule 11: Reporting on Performance and
Outcomes
Schedule 12: Ownership of Equipment
Schedule 13: Research Involving Biohazards
Schedule 14: Conflict of Interest in Research
Schedule 15: Public Communication
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Christine Charbonneau
Director, Finance
Canada Foundation for Innovation
(613) 943-1289
christine.charbonneau@innovation.ca
Carole Crete-Robidoux
Manager, Awards Administration and Financial Monitoring
NSERC/SSHRC
(613) 992-5596
carole.crete-robidoux@nserc.ca
Lucie Mercier-Gauthier
Associate Vice-President, Financial Resources
The University of Ottawa
(613) 562-5740
luciemg@uOttawa.ca
Deanne Babcock
Manager, Research Accounting
Financial Services, The University of Western Ontario
(519) 661-2111 ext 85455
dbabcock@uwo.ca
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