National Council of University Research Administrators
Introduction to the
Uniform Guidance
KEYS TO SUCCESS
NCURA Region IV
Spring Meeting
April 27 – 30, 2014
© 2014 National Council of University Research Administrators
NCURA Region IV Spring Meeting
April 27 – 30, 2014
Jennifer Rodis, Interim Policy & Planning Analyst,
University of Wisconsin – Madison
Bonniejean Zitske, Managing Officer,
University of Wisconsin – Madison
@ 2014 National Council of University Research Administrators
NCURA Region IV Spring Meeting
April 27 – 30, 2014
Overview
1.History of the Uniform Guidance
2.What is the intention of the UG?
3.What are the next steps?
4.What are the big changes?
@ 2014 National Council of University Research Administrators
Background
• November 23, 2009: E. O. 13520 – Reducing
Improper Payments and Eliminating Waste in
Federal Programs
• February 28, 2011: Presidential Memorandum
on Administrative Flexibility, Lower Costs, and
Better Results for State, Local, and Tribal
Governments
• May 2011: A-21 Task Force established
• October 2011: COFAR created
© 2014 National Council of University Research Administrators
Recent History
• February 28, 2012: Advance Notice of Proposed
Guidance: Reform of Federal Policies Relating to
Grants and Cooperative Agreements; Cost
Principles and Administrative Requirements
(including Single Audit Act)
• February 1, 2013: Proposed Guidance
• June 2013: OMB/COFAR receive 300+ responses
• December 26, 2013: Final Uniform Guidance
released
© 2014 National Council of University Research Administrators
What’s in a name
• Uniform Administrative Requirements, Cost
Principles, and Audit Requirements for Federal
Awards
• OmniGuidance (OmniCircular)
• 2 CFR Part 200, et al. or 2 CFR Part 200
• Uniform Guidance or UG
© 2014 National Council of University Research Administrators
2 CFR 200, et al. replaces
OMB Circulars:
• A-21: Cost Principles for Educational Institutions
• A-87: Cost Principles for State, Local, and Indian Tribal Governments
• A-110: Uniform Administrative Requirements for Awards and Other
Agreements with Institutions of Higher Education, Hospitals, and
Other Non-Profit Organizations
• A-122: Cost Principles for Non-Profit Organizations
• A-89: Federal Domestic Assistance Program Information
• A-102: Awards and Cooperative Agreements with State and Local
Governments
• A-133: Audits of States, Local Governments, and Non-Profit
Organizations
• A-50: sections related to audits performed under the Single Audit
Act
© 2014 National Council of University Research Administrators
Where to find
Uniform
Guidance
https://www.federalregister.gov/articles/2013/12/26/201330465/uniform-administrative-requirements-cost-principlesand-audit-requirements-for-federal-awards
© 2014 National Council of University Research Administrators
Overall Structure
• Subpart A – Acronyms and Definitions
• Subpart B – General Provisions
• Subpart C – Pre-Federal Award Requirements
and Contents of Federal Awards
• Subpart D – Post Federal Award Requirements
• Subpart E – Cost Principles
• Subpart F – Audit Requirements
• Appendices I, II, & III
© 2014 National Council of University Research Administrators
Effective/Applicability
Dates
• See 200.110
• Federal agencies must submit draft
implementing regulations to OMB by 6/26/2014.
• For new and incremental funding awarded
December 26, 2014 and after (except Subpart F)
• Subpart F, Audit Requirements, first FY beginning
after December 26, 2014
• No guidance on F&A rate proposals
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
http://www.whitehouse.gov/omb/
grants_docs
Crosswalks/
Text Comparisons
Link to sign up for
COFAR mailing list
Resources
• https://cfo.gov/cofar/
• Frequently Asked Questions:
https://cfo.gov/wpcontent/uploads/2013/01/2-C.F.R.-200-FAQs2-12-2014.pdf
• Questions or comments: cofar@omb.eop.gov
© 2014 National Council of University Research Administrators
COFAR Webcasts
• COFAR Training Intro:
http://www.youtube.com/watch?v=SOET4b7my8&feature=youtu.be
• COFAR Training Administrative Requirements:
http://www.youtube.com/watch?v=BP3l3PjI1JQ&featu
re=youtu.be
• COFAR Training Cost Principles:
http://www.youtube.com/watch?v=q0rWXdy2ICM&fea
ture=youtu.be
• COFAR Training Audit Requirements:
http://www.youtube.com/watch?v=g-U8HGbbCY&feature=youtu.be
© 2014 National Council of University Research Administrators
NCURA Webcast
The OMB Uniform Guidance: Key Issues for Universities
May 14, 2014, 1:00 - 3:30 pm EDT
Moderator:
Kim Moreland, Associate Vice Chancellor for Research and Sponsored Programs,
University of Wisconsin - Madison
Panel:
Michelle Christy, Director, Office of Sponsored Programs, Massachusetts Institute of
Technology
Mark Davis, Vice President for Higher Education, Attain
Cindy Hope, Assistant Vice President for Research, The University of Alabama
David Kennedy, Director of Costing Policies and Studies, Council on Governmental
Relations
Jim Luther, Assistant Vice President, Research Costing Compliance, Duke University
http://www.ncura.edu/Education/OnlineEducation/Webcast.aspx
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
Objectives of Uniform
Guidance
• Streamline guidance for Federal Awards to
ease administrative burden
• Strengthen oversight over Federal funds to
reduce risks of waste, fraud, and abuse
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27
– 30, 2014 Monitoring
200.330
Subrecipient
Subrecipient and Contractor
• Non-Federal entity classifies the subrecipient or
contractor
• Subrecipient characteristics:
–
–
–
–
–
Eligibility determined by the pass-through
Performance measured by program objectives
Responsible for programmatic activities
Adheres to Federal program requirements
Uses the funds for a public purpose, not to provide
good or services for the benefit of the pass-through
entity
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April Subrecipient
27 – 30, 2014
200.330
Monitoring
Subrecipient and Contractor
• Contractor characteristics:
– Provides the good/services within normal business
operations
– Provides good/services to many purchasers
– Operates in a competitive environment
– Provides goods/services that are ancillary to the
operations of the Federal program
– Is not subject to compliance requirements of the
Federal program as a result of the agreement
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.331 Pass-through
Entities
• Required to pass through multiple data elements to
subrecipient, including:
–
–
–
–
–
–
–
–
–
–
Federal award ID
Subrecipient name – match with DUNS
FAIN number
Period of performance
Federal Award project description (FFATA)
Total amount of the Federal award
CFDA number and name
Identification of award as R&D or not
Indirect cost rate or de minimis rate
Many other elements
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.331 Monitoring
the Subrecipient
• Monitoring must include:
– Review of financial & programmatic reports
– Follow-up with deficiencies detected through audits,
on-site reviews, and other means
– Issue a management decision for audit findings
related to the Federal award
– Use additional monitoring tools if necessary (tools
may be useful)
• Training and technical assistance
• On site review
• Agreed-upon-procedures engagements
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.332 Fixed Amount
Subawards
• New limitations
– Requires prior written approval from the Federal
agency
– Fixed Price subawards up to the Simplified Acquisition
Threshold ($150,000)
– Subawards meet the requirements of 200.201
• Project scope is specific
• Cost or unit pricing data is available
• Non-Federal entity will realize no increment above actual
cost
• Cannot be used if there is mandatory cost sharing
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
Contract, Subaward,
Vendor?
• Contract – 200.22
– A legal instrument by which a non-Federal entity
purchases property or services
– NOT a legal instrument when the substance of the
transaction meets the definition of award or
subaward
• Subaward – 200.92
– Award to a subrecipient to carry out part of a Federal
award received by a pass-through. Does not include
payments to a contractor. May be any form of
agreement, including a contract.
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
Confused?
• Federal award 200.38
– Federal financial assistance received directly from a
Federal agency or through a pass-through
– A cost-reimbursement contract under FAR received
directly or through a pass-through
• So, what is a vendor?
– Might be a contractor, but not a cost-reimbursement
contractor under FAR regs
– Since pass-through entities can determine the nature
of the subaward, are we OK treating a vendor as a
vendor and charging F&A?
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
Modified Total Direct
Costs (MTDC)
• Participant Support costs are now a standard
exclusion
• Not new but, lack of definition for “subcontract” is
increasingly problematic
– MTDC excludes “the portion of each subaward and
subcontract in excess of $25,000”
– Some agencies insist vendor agreements/contracts
for purchased services, supplies, etc. are
“subcontracts”
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.94 Definition of
Supplies
• Acknowledgement of computing devices as a
supply cost
• New Definition
– “Supplies means all tangible personal property
other than those described in § 200.33
Equipment. A computing device is a supply if the
acquisition cost is less than the lesser of the
capitalization level established by the non-Federal
entity for financial statement purposes or $5,000,
regardless of the length of its useful life.”
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
Computing Devices
• Computing devices means machines used to
acquire, store, analyze, process, and publish data
and other information electronically, including
accessories (or “peripherals”) for printing,
transmitting and receiving, or storing electronic
information. (200.20)
• In the specific case of computing devices,
charging as direct costs is allowable for devices
that are essential and allocable, but not solely
dedicated, to the performance of a Federal
award. (200.453)
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.430 Compensation –
Personal Services
• Preamble on pages 78601 – 78602:
– COFAR balanced universities’ input and auditors’
perspective
– More flexibility but a requirement to “comply with a
stringent framework of internal control objectives and
requirements”
• 200.303 Internal Controls
– These internal controls should be in compliance with…
COSO framework
– COSO: Integrated Framework of Control Environment,
Risk Assessment, Control Activities, Information and
Communication, & Monitoring Activities
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.430 Compensation –
Personal Services
• More Flexibility
– No requirement for “activity/effort reports”, Removed reference to
certification/certify or confirmation
• Eliminated
– J.10.c(1)f: requirement for “independent internal evaluation”
– Examples of acceptable Methods for Payroll Distribution
• Added
– Institutional Base Salary (IBS)
• (ii) The non-Federal entity establishes a consistent written definition of work
covered by IBS which is specific enough to determine conclusively when work
beyond that level has occurred
– Allowable activities:
• Added language to allow for “developing and maintaining protocols”….
“managing and securing project-specific data, coordinating research
subjects…”
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.430 Compensation –
Personal Services
• Continued focus on “processes to review after-thefact.” Must reflect the work performed
• January 27, 2014 Webinar confirmed:
– January 5, 2001 Clarification of OMB A-21 Treatment
of Voluntary Uncommitted Cost Sharing (VUCS) and
Tuition Remission Costs – still in place
• VUCS not included in organized research base
• …such faculty effort is excluded from the effort
reporting requirement in section J.8
• …most Federally-funded research programs should
have some level of committed faculty (or senior
researchers) effort, paid or unpaid by the Federal
Government
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.430 Compensation –
Personal Services
• Changes look promising, but details not clear
• Auditor interpretation
• Internal Controls
• Review current system in light of Internal Control standards
(COSO)?
• Written policies
• Define IBS
• Solid systems
• FDP Project Certification pilot may inform/drive the discussion
• Review audits of pilot institutions
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.413 Direct Costs (c)
Clerical & Admin Salaries
“The salaries of administrative and clerical staff should normally
be treated as indirect (F&A) costs. Direct charging of these costs
may be appropriate only if all of the following conditions are
met:
1.
2.
3.
4.
Administrative or clerical services are integral to a project or
activity;
Individuals involved can be specifically identified with the project
or activity;
Such costs are explicitly included in the budget or have the prior
written approval of the Federal awarding agency; and
The costs are not also recovered as indirect costs.”
• Removal of “major project” requirement and examples
• Recognition of administrative workload
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.431 a(3)(i)
Fringe Benefits
• “When a non-Federal entity uses the cash
basis of accounting, the cost of leave is
recognized in the period that the leave is
taken and paid for. Payments for unused leave
when an employee retires or terminates
employment are allowable as indirect costs in
the year of payment.”
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.431 a(3)(i)
Fringe Benefits
• Was not in the Proposed Guidance
• Would require a significant change in accounting for unused
leave for institutions using the cash basis of accounting
• Handle as accrual via fringe benefit – could increase 3-10
points
• “…Payments for unused leave when an employee retires or
terminates employment are allowable as indirect costs in the
year of payment.”
– Should a request for extension be made for this significant
change?
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
F&A Rate Administration
•
Indirect (F&A) costs - 200.414
– (c) Federal Agency Acceptance – “the negotiated rates must be
accepted by all Federal awarding agencies”
• Some exceptions – statute or regulation, agency head approval
– (f) 10% de minimis for entities that have never received
negotiated rate
– (g) Allows a one-time extension of Federally negotiated F&A
rates for up to four years
• Subject to approval of the cognizant agency for indirect costs.
• If granted, the institution may not request a rate review until the
extension period ends.
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.419 Cost accounting
standards and disclosure statement
• IHEs receiving $50 million or more in federal
awards in a fiscal year
– Same four Cost Accounting Standards
– Same Disclosure Statement (DS-2)
• New process for amendments–
– File at lease 6 months prior to change
– Cognizant agency for indirects can approve,
disapprove or ask for more time
– If no response from cognizant agency within 6
months, may proceed with change
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
200.474 (c) (1)
Travel Costs
“Temporary dependent care costs (as dependent is
defined in 26 U.S.C. 152) above and beyond regular
dependent care that directly results from travel to
conferences is allowable provided that:
(i) The costs are a direct result of the individual’s travel
for the Federal award;
(ii) The costs are consistent with the non-Federal entity’s
documented travel policy for all entity travel; and
(iii) Are only temporary during the travel period”
• May require one to rethink Travel Policy
• Consistency with all funds
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
F&A Rate Calculation
•
Cost Sharing – 200.306
– Restrictions on Voluntary Committed (discussed earlier)
– Only mandatory or committed in the BUDGET included in
organized research base for computing F&A
• NIH Salary Cap?
• How will all of these changes affect the F&A rate
calculation?
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
Audit requirements
200.501
• “(a) Audit required. A non-Federal entity that expends
$750,000 or more during the non-Federal entity’s fiscal
year in Federal awards must have a single or programspecific audit conducted for that year in accordance
with the provisions of this Part.”
• Increases the threshold from $500,000 in Federal awards
per year to $750,000 in Federal awards per year
• Reduces audit burden for approx. 5,000 non-Federal
entities; maintains oversight for over 99% of dollars
currently covered by Single Audit
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
Subpart F –
Audit Requirements
• Impact of effective dates
– Awards issued under new requirements but audited prior to first FY beginning
after 12/26/14
– Awards issued under old requirements but audited under Subpart F
• These issues and many, many more are still being
assessed, in large part by the Public Accounting firms.
COGR and others intend to collaborate with this group in
developing further guidance.
© 2014 National Council of University Research Administrators
NCURA Region IV Spring
Meeting
April 27 – 30, 2014
• Questions?
• Answers?
© 2014 National Council of University Research Administrators