The Federal Government's Office of Management and Budget (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements (2 CFR 200) establishes principles for determining costs applicable to grants, contracts, and other agreements between Federal agencies and non-Federal entities (i.e., educational institutions). All Federal agencies that sponsor research and development, training, and other work at educational institutions must apply the provisions of the Uniform Requirements in determining the costs incurred for such work.
As a major research university that manages a large number of sponsored agreements, Georgia Institute of Technology must have financial systems and internal control procedures in place to assure compliance with the terms and conditions of these agreements and State and Federal regulations concerning sponsored programs. One of the most important parts of these procedures involves the documentation and support of the distribution of salary and fringe benefits charges to sponsored programs.
Georgia Institute of Technology policy requires that the preparation of invoices to sponsors be based on the information in the accounting records, including the salary and fringe benefit charges determined by the Plan Confirmation System. In most instances, these billings are issued on a monthly basis. Every invoice must be signed and certified by an Institute financial officer. The signature certifies the accuracy of the charges presented on the invoice for payment:
- Are allowable to the project scope,
- Are allowable by the project budget,
- Are reasonable and have been incurred within the Period of Performance, and
- Have been incurred according to all Institute accounting policies and procedures.
For the above reasons, the distribution of personal service costs to sponsored projects is a sensitive issue in the university's operation of its sponsored programs; it therefore receives careful scrutiny by Institute officers, sponsor representatives, and federal government contracting officers and auditors.
These provisions apply to all units of Georgia Tech other than the Georgia Tech Research Institute (GTRI). Employees of GTRI utilize hourly time sheet procedures designed to comply with Federal Acquisition Regulations 31.2, which have different requirements for the documentation of personal services expenses. The GTRI Policies & Procedures Manual includes specific instructions for GTRI time sheet preparation and time reporting.
Electronic Workload Assignment Form report produced monthly for Plan Confirmation System employees to review their effort allocation for accuracy and make timely corrections.
Electronic Annual Statement of Reasonableness report produced annually for Plan Confirmation System employees documenting confirmation and certification that their effort allocation was reasonable and correctly posted in the past fiscal year.
Compensation for Personal Services
Compensation for personal services covers amounts paid currently, or accrued by the institution, for services of employees rendered during the period of performance under sponsored agreements or other institutional activity. The distribution of salaries and wages, whether treated as direct (charges to activities such as instruction, research, public service) or F&A (indirect) costs (support activities such as Departmental Administration, contract administration and accounting, and central administrative office services), are based on payrolls documented in accordance with the generally accepted practices of colleges and universities. The payroll distribution system, which is incorporated into the official records of the institution, must reasonably reflect the activity for which employees are compensated by the institution, and it encompasses both sponsored and all other activities on an integrated basis.
Georgia Tech uses the Plan Confirmation System for exempt employees and the After-the-Fact Activity Records System for non-exempt employees for handling payroll distributions.
After-the-Fact Activity Records - Non-Exempt Employees
Georgia Tech uses the After-the-Fact Activity Records system for non-exempt employees. OMB Uniform Requirements states that charges for salaries and wages of non-exempt employees must also be supported by records indicating the total number of hours worked each day. The use of time documents, as prescribed under current Georgia Institute of Technology payroll procedures, meets the requirements of the OMB Uniform Requirements for non-exempt employees. So although these employees are covered by OMB Uniform Requirements, they are not included in the Institute's Plan Confirmation System.
Plan Confirmation System - Exempt Employees
Georgia Tech uses the Plan-Confirmation System as the basis for its distribution of salaries and wages for most exempt faculty and staff. Under this system the distribution of salaries and wages is based on budgeted, planned, or assigned work activity based on the initial annual budget and updated throughout the year to reflect any significant changes in work distribution.
Employees Covered by the Plan-Confirmation System
Exempt Faculty and Staff
The Georgia Tech Plan-Confirmation System covers all exempt faculty and staff employees who meet the following requirements at any time during the fiscal year:
- All academic personnel paid monthly whose activities are distributed to a sponsored project and/or more than one project or account.
- All other monthly paid personnel:
Whose activities are distributed directly either to one or more organized research projects, other sponsored agreements, or cost-sharing projects.
Who distribute their activities to more than one direct or indirect (Facilities and Administrative) activity.
Who split their effort between direct and indirect (Facilities and Administrative) activities.
Who have any or all of their effort distributed to Departmental Administration–Instruction, Departmental Administration-Research and/or Other Sponsored Activities.
Graduate Student Employees
Georgia Tech uses the Plan-Confirmation System as the basis for its distribution of salaries and wages for all appointed graduate students who are paid on a monthly basis from sponsored, cost-sharing, general research and departmental administration projects. Under this system the distribution of salaries and wages is based on budgeted, planned, or assigned work activity, which is updated throughout the year to reflect any significant changes in work distribution.
All graduate students who are paid on an hourly basis shall report their time worked on bi-weekly time documents, and the Plan-Confirmation System does not cover them. This procedure meets the OMB Uniform Requirements and no additional reporting is necessary.
Salary Planning and Distribution (SPD) System
The Institute uses a Salary Planning and Distribution System (SPD) which operates as a sub-system to our Office of Human Resources Payroll system. The SPD system is designed to receive employee and salary distribution information from the payroll system, and can accept new information about employee activities to update the distribution of salary and fringe benefits expenses. In most instances, the unit financial managers can enter updates to salary distribution directly to the system on a daily basis. Salary distribution changes for other units are processed on a daily basis by the SPD Center located in the Office of Grants and Contracts Accounting. Salary distribution changes can be made throughout the month and updated summary reports of employee salary distribution can be printed after completion of each change. This information is directly submitted to the sponsored project accounting records to permit early evaluation of project financial status.
As a part of the SPD system features, any applicable fringe benefit expenses are charged to projects based upon the appropriate flat rate fringe benefits percentages as approved on an annual basis. In addition, graduate student tuition remission (GSTRP) charges are posted and encumbered for all projects that are eligible for these charges.
Georgia Institute of Technology Budget System
The Plan-Confirmation System (PCS) and the Salary Planning and Distribution (SPD) System have been developed and implemented to support the Institute budget process.
In preparing the annual budget, the Budget Office obtains original operating budget information from all campus organizational units. The initial budget information contains the details of each employee's salary as well as the distribution between state and sponsored projects. When the budget is approved, the salary information is uploaded to the Office of Human Resources' payroll system. Following that process, the SPD system is populated with the approved project allocations to initiate the activity monitoring required by the Plan-Confirmation System. Subsequent appointments are entered into the payroll system using the OHR appointment forms and then the information is updated in the SPD system.
Electronic Workload Assignment Forms
At the end of each month, a workload assignment form is prepared for each employee covered by the Plan-Confirmation system. Employees are notified by E-Mail from Grants and Contracts Accounting when their reports are available and may be accessed directly using a link provided in the message. These forms can also be reviewed by employees on their TechWorks Home Page when obtaining monthly payroll information. Unit financial managers may also produce copies for review by individual employees. Each monthly Electronic Workload Assignment Form (eWAF) covers an entire fiscal year, July 1 to June 30, including both actual payments and planned salary distribution for future periods. In this way, the employee is reminded of the current and future distribution of salary charges based on effort and his/her responsibility to report workload changes to his/her supervisor in a timely manner. See “Employee Responsibilities”.
Significant Changes in Workload Distribution
The Plan-Confirmation System provides for the modification of an individual's salary distribution, commensurate with any significant change in the employee's workload or the ratio of activities comprising the total workload. Specific events, which will or may cause a significant change in workload distribution include, but are not limited to:
- The beginning or ending of work on a sponsored project or an internally funded project.
- A material change in the scope of work on a project.
- An increase or decrease in the number or level of courses taught.
- A new committee or major administrative assignment or relief from a committee or major administrative assignment.
- The beginning or ending of a sabbatical leave, leave without pay, or prolonged sick leave.
- Status changes from part-time to full-time or vice versa.
The system does not require an adjustment in the employee's workload assignment for day-to-day, or short-term, changes in his/her work schedule. However, the basic concept of the Plan-Confirmation System does require an adjustment for all significant changes in an employee's workload. Although there is no precise definition for the term "significant," Georgia Institute of Technology policy provides for a general rule that a change applicable to a given project or activity of 5% or more of an employee's total effort over the course of the academic term would warrant an adjustment.
Changes in an employee's workload distribution for future periods are generally acceptable but are subject to the standard documentation requirements noted below. Future period workload distributions are confirmed monthly via EWAF (described above).
Retroactive Changes in Workload Distribution
Retroactive changes to payroll distributions must be subjected to the closest scrutiny. These types of changes indicate a contradiction of previous monitoring reviews and, for that reason, should be limited to the correction of errors. If a retroactive change must be made, it must be approved and documented in accordance with the requirements included below.
Standard Documentation Requirements
Primary supporting documentation for Plan Confirmation System salary charges are either electronic or signed paper Acknowledgement of initial Personal Services Reporting (PSR) training; Monthly Workload Assignment Forms (EWAFs); and Annual Statements of Reasonableness (ASRs). These forms and reports are fully explained in other sections of this policy statement.
Georgia Tech authorizes the principal investigator (PI) and the properly authorized unit designee (financial manager and staff) to have primary responsibility for the management of sponsored agreement funds. Therefore, the actions of these individuals as documented using manual/electronic signatures and/or a system password is normally considered sufficient documentation to support standard workload allocation changes.
Retroactive changes that cross fiscal years may be made in extraordinary circumstances by manual journal entries when supported by appropriate documentation, including a revised Annual Statement of the Reasonableness of Salary Charges (ASR).
Special Documentation Requirements and Limitations – Externally-funded** Sponsored Projects
In addition to the standard documentation requirements noted above, retroactive salary distribution changes that add salary charges to externally-funded** sponsored projects must be accompanied by a written (or system-recorded) justification statement at an appropriate level of detail. Specific reasons for the transfer must be provided in the explanation. Transfer requests of this type that are not properly documented with an acceptable justification statement will be moved to the unit's sponsored undesignated project number by SPD Center staff.
Retroactive salary cost transfers to externally-funded** sponsored projects beyond 90 days of the original expense posting will not be allowed under normal circumstances.
Provisions for exceptions to the 90 day limit will be considered as follows:
- In situations where initial or continuing sponsor funding is delayed beyond 90 days after the effective date, consideration for recognition of cost transfers beyond the limit will be addressed by the Grants and Contracts Accounting Office if the transfer is requested within the reporting period of the sponsored project (typically 60-90 days after the expiration date of the project). If the terms and conditions of the sponsored agreement provide for acceptance and payment of the expenses covered by the proposed cost transfer and appropriate supporting documentation is provided, the Senior Director of Grants and Contracts Accounting will approve the proposed transfer.
- Other exceptions will be considered on a case-by-case basis and properly documented.
- Upon the proper approval of the Senior Director of Grants and Contracts Accounting, the Associate Vice President for Financial Services, and the Associate Vice President for Research, such entries will be recorded.
** Excludes sponsored projects funded by the Georgia Tech Foundation and Georgia Tech Research Corporation. Transfers between projects associated with the same sponsored fund (award) are not subject to special documentation requirements or the 90 day limitation.
Annual Statement of Reasonableness (ASR) of Salary Charges
The Plan-Confirmation System requires that at least annually a statement will be signed (electronically or manually) by the employee, principal investigator, or responsible official, using suitable means of verification that the work was performed, stating that salaries and wages charged to sponsored agreements as direct charges, or that salaries and wages charged to both direct and indirect cost categories, or to more than one (F&A) indirect cost category, are reasonable in relation to work performed.
The Annual Statements on the Reasonableness of Salary Charges (ASRs) for Georgia Tech coincide with the institution's fiscal year, which ends June 30 for covered employees having Fiscal or Academic Year appointments. The Salary Planning and Distribution (SPD) Center of the Office of Grants and Contracts Accounting will send email notifications to covered employees to complete the ASR certification electronically (eASR), with an embedded link, following the completion of the fiscal year. Employees will logon to the eASR application, review their final fiscal year distribution, and electronically confirm their eASR with their userid and time/date stamp representing an electronic signature. For those not completing the electronic ASR, the SPD Center will distribute manual ASRs to School Chairs or organizational unit heads to be certified. EASRs and manual ASRs must be completed and returned according to the specific date selected each year.
The Annual Statement on the Reasonableness of Salary Charges presents the workload distribution of each employee for the fiscal year. This statement shows the amount of salary charged to each of the employee's projects and the percentage of each amount to the total effort. This statement merely restructures the Electronic Workload Assignment Form, which the employee has in his/her possession. The manual ASR provides a ready means of making adjustments in payroll distributions if corrections are required. The instructions on the manual Annual Statement provide that the percentages of certified annual effort, Column D on the form, are to be completed only if they differ from the actual amounts of salary charged to the various projects. If changes are required, the certified annual effort percentages in Column D must be entered for each project number and must total 100%. Also, if effort is reported in Departmental Administration (typically Project numbers ending in 290, 400, 990) the section on these activities must be completed by designating the activities performed.
ASR Signatory Requirements – Certification of Effort
The Electronic Annual Statement on the Reasonableness of Salary Charges (ASR) is designed for the employee to confirm that the distribution of salary charges to projects represents a reasonable estimate of the work performed during the stated period. In most instances, only the employee has the information required to complete this certification and therefore eASR's must be completed and signed by the covered employee.
The manual ASR does provide a second certification section to be used in limited instances when the covered employee is not available to complete the certification. This certification may be signed by the employee’s supervisor, PI, or other organizational unit head, without the employee's signature, provided the responsible official is prepared to certify that he/she has firsthand knowledge of all the employee's activities using suitable means of verification that the work was performed. If the responsible official cannot certify that he/she has personal familiarity with all of the employee's activities, then the employee is required to sign the statement. In some cases, an employee may be involved in a number of activities under different supervisors, and no single person other than the employee has firsthand knowledge of all his/her activities. In these cases, the employee must sign the documents.
If a covered employee or graduate student completes his/her term of employment and/or is on leave from Georgia Tech during the certification period, a special ASR can be requested from the SPD Center for immediate confirmation prior to fiscal year-end. These special ASR's will be prepared to reflect all salary payments made to the employee at the end of the assignment.
Unit Financial Manager's Certification
The Plan Confirmation System procedures also require that the appropriate financial manager in each unit review the electronic or manual ASR statements before returning to the SPD Center in Grants and Contracts Accounting. This unit quality assurance review is needed to ensure that the ASR amounts and distribution agree with the payroll and SPD records, that the Departmental Administration section of the statement has been completed as needed, and that the form has been signed as required. The financial manager should sign and date each eASR or manual ASR to indicate that the review has been done. The eASR has the Financial Manager userid and Time/date stamp representing an electronic signature. For manual ASRs, this action is in addition to any signature reported as a responsible official having firsthand knowledge of the employee's activities. In no case should the employee signing the manual ASR in the Certification section (above) also sign in this financial manager certification section.
To obtain hard copy forms, please contact the Office of Grants & Contracts Accounting at firstname.lastname@example.org .
8.1 Departmental Responsibilities
Unit heads and financial managers (who have been delegated signature authority by unit heads for submission of salary information to the Budget and SPD Systems) are responsible for the accuracy of salary and fringe benefits transactions. This includes confirmation that the salary charges are allowable charges to the designated projects, and that funds are available to support such charges.
All changes to salary distribution are to be reported and corrected as soon as possible to assure the accuracy of monthly invoicing to sponsors. This reporting process is covered in the SPD System operating procedures and training programs. All retroactive salary distribution changes that add charges to externally-funded** sponsored projects are subject to additional documentation requirements, restrictions, and limitations. See “Retroactive Changes in Workload Distribution”.
Unit financial managers are to provide instructions and support to employees covered by the Plan Confirmation System (PCS) to make sure that these employees understand their responsibilities in this regard. This training is supported by the Salary Planning and Distribution (SPD) Center in the Grants and Contracts Accounting Office via an on-line tutorial entitled “Personal Services Reporting” (PSR). After viewing the required tutorial on the GT Training website, all employees covered by the system must complete an assessment questionnaire. Once they have passed the tutorial the employee must click the Acknowledgement Statement to record their successful completion of the PSR training. An alternative training option is to read the PSR booklet (found on the G&C website) and submit a paper acknowledgement form indicating that they understand their responsibilities for personal services reporting using the Plan-Confirmation System. This completed acknowledgement (either electronic or paper) must be on file in the SPD center for all employees whose salaries are charged directly or indirectly to sponsored projects.
8.2 Principal Investigator Responsibilities
Each Georgia Tech PI is responsible for effectively overseeing and managing his/her sponsored projects based to a considerable extent upon his/her knowledge of the field of study and his/her capabilities to conduct the projects in an efficient and productive manner.
Monthly “PI Sponsored Project Review” reports are provided directly to PIs by the Office of Grants and Contracts Accounting to permit timely reviews and approval/confirmation of all charges posted to his/her assigned sponsored projects. PIs are to perform periodic reviews of these charges to provide proper financial oversight.
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8.3 Employee Responsibilities
The employee has definite responsibilities in the operation of the Plan-Confirmation System (PCS), and these are set forth below for his/her information and guidance:
- All employees with appointments to positions or activities covered by the PCS must develop an understanding of their responsibilities for PCS reporting by participating in the on-line Personal Services Reporting training program and/or reading the Personal Services Reporting booklet. After successfully completing the required training, the employee must submit an acknowledgement indicating that they understand their responsibilities for personal services reporting using the Plan-Confirmation system.
- The employee is to review their Monthly Workload Assignment form to confirm the accuracy of current and future salary distribution. To assist in this regard, each monthly report includes a notification regarding changes made to their workload allocations since the last report.
- The employee must advise his/her supervisor or unit financial manager if his/her Monthly Workload Assignment forms are not received in a timely manner.
- The employee must advise his/her supervisor if the actual effort for a given project or planned to be given to a project or activity varies by 5% or more of the total estimated effort shown for the current assignment, so that the workload may be modified.
- The employee must provide additional supporting documentation to his/her supervisor for any change in salary distribution that is reported over 90 days after the payroll date. The supporting documentation must include a copy of the employee’s Workload Assignment Form for any period past 90 days of the payroll date. For all salary distribution charges to externally-funded sponsored projects, an alternate funding source is to be provided.
- If appropriate action is not initiated promptly by his/her supervisor or the designated unit financial manager, the employee should immediately notify the SPD Center at email@example.com.
- The employee must retain in his/her files the initial workload assignment form as well as all Monthly Electronic Workload Assignment Forms received during the current fiscal year.
- The employee must electronically or manually complete, sign, date, and return their Annual Statement on the Reasonableness of Salary Charges for each fiscal year by the stated deadline.
To report suspected instances of noncompliance with this policy, please visit Georgia Tech’s EthicsPoint, a secure and confidential reporting system, at: https://secure.ethicspoint.com/domain/en/report_custom.asp?clientid=7508
|10-17-2015||Office of Grants & Contracts Accounting||Align with terminology of Fair Labor Standards Act (FLSA)|
|10-01-2015||Office of Grants & Contracts Accounting||Revise Special Documentation Requirements and Limitations – Externally-funded Sponsored Projects from 120 days beyond the original expense posting date to 90 days aligning with close-out requirements of OMB 2 CFR 200.|
|11-05-2014||Office of Grants & Contracts Accounting||Align with requirements of 2 CFR 200|
|04-01-2012||Office of Grants & Contracts Accounting||Administrative review|