UNIVERSITY OF PITTSBURGH POLICY 11-01-07

CATEGORY:              RESEARCH ADMINISTRATION

SECTION:                  Research

SUBJECT:                 Effort Reporting and Certification

EFFECTIVE DATE:   December 19, 2012  

PAGE(S):                   7

I.    PURPOSE

      To establish responsibility for effective effort reporting and certification in compliance with federal Office

      of Management and Budget (OMB) Circular A-21.  Compliance with this policy will ensure that effort

      certifications completed in connection with the University’s federal sponsored projects are performed

      timely, accurately reflect the level of effort expended on each sponsored project, and comply with federal

      requirements.

      Failure to comply with the requirements of OMB Circular A-21 could result in financial penalties,

      expenditure disallowances, and damage to the University’s reputation as a leading research institution. 

      All faculty and staff involved in the allocation of salaries and wages to sponsored projects, managing

      sponsored projects, or completing/certifying effort statements are responsible for understanding the

      principles of accurate and timely effort reporting.  Adherence to all provisions of this policy by all

      individuals with sponsored project responsibility is expected.

II.   SCOPE

      This document sets forth the University’s policy on effort reporting and certification of salary charges to

      sponsored projects administered by the University.  It applies to all employees (as well as graduate

      students and work study students) whose salaries or stipends are charged, in whole or in part, directly

      or indirectly, to sponsored projects and to all employees involved in certifying the effort of these

      individuals.  This policy is supported by detailed information on the use of the University’s effort reporting

      system and necessary compliance requirements, which can be found on the Chief Financial Officer’s

      (CFO) website.

III.  DEFINITIONS

      Effort – The time spent on any activity by an individual, expressed as a percentage of the individual’s

      total University effort.  Total University effort for each individual is 100% regardless of the number of

      hours worked per week or the percentage Full Time Equivalent (FTE) of their appointment.

      Effort Reporting – The process by which the University documents the effort expended on sponsored

      projects, consistent with OMB Circular A-21 requirements for confirming salary and fringe benefits

      charges to sponsored projects.  Effort for sponsored project activity is recorded in proportion to the

      individual’s other activities such as teaching, administration, public service, etc., with each activity

      expressed as a percentage of the individual’s total University activities.  The sum of an individual’s

      effort percentages must be 100%.  Salary charges are distributed according to these effort

      percentages.  Periodic certification of effort percentages is required.

      Certification of Effort Statements – A signed affirmation certifying that salary charges to federal

      sponsored projects, based on the effort percentages reported and in context with all activities comprising

      the employee’s University appointment, are reasonable in relation to the work performed.  The certifier

      must acknowledge all non-federal and non-sponsored activities as this effort, combined with the federal

      sponsored project effort, form the body of work upon which the percentages are derived.  The signature

      must be that of the employee, Principal Investigator (PI), or other responsible official using suitable means

      of verification.  Knowingly signing an inaccurate effort statement, unauthorized delegation of certification

      responsibilities, or use of another’s University ID and password to electronically certify are serious

      violations of University policy, subject to discipline under those policies as well as, in some cases,

      violations of applicable laws and regulations.

      Institutional Base Salary (IBS) – Represents the compensation of an individual for his/her University

      effort.  Generally, this will be the academic contract salary plus any administrative supplements.  See the

      definition below for activities included in Total University Effort.

 

      Period of Performance – The four-month academic period during which effort is expended on the

      activities comprising an individual’s University appointment.

      Salaried Personnel Activity Report (SPAR) – The University of Pittsburgh system for recording

      professional effort and distributing salary charges based on an individual’s documentation of work
      activities expressed as a percentage of Total University Effort.

      Total University Effort – Represents the professional activity for which an individual is compensated by

      the University.   Total University Effort for each individual is 100% regardless of the number of hours

      worked per week, the percentage FTE of their appointment, or the duration of employment during the

      period of performance. Effort is distinct from employment.  Dual employment between the University and

      any affiliated entity does not result in the inclusion of affiliate effort in Total University Effort.  The effort

      percentages are used to distribute an individual’s University salary to the specified activities and,

      therefore, do not include effort on activities paid by other entities.  The Institutional Base Salary is the

      compensation for the activities listed below as included in Total University Effort.

            Activities included in Total University Effort:

                 Externally sponsored research - includes activities such as delivering special lectures about

                  specific aspects of the ongoing sponsored project, writing reports and articles, participating in

                  appropriate seminars, and attending meetings and conferences.

                 Departmental/University research - includes uncompensated participation in study sections,

                  peer review of manuscripts, or unfunded effort on externally sponsored research.

                 Instruction/University supported academic effort - includes presentations to students/trainee

                  groups and mentoring trainees (unless specifically part of a sponsored project which would be

                  classified in the externally sponsored research category above).

                 Administrative effort – includes administrative activities (e.g., Department Chair, Program

                  Director, service on institutional committees, department activities, faculty advisory boards, etc.)

                 Effort expended on preparing proposals for new or competitive segments of sponsored projects.

                 Volunteer community service activities in support of the University’s missions.

            Activities outside of Total University Effort:

                 Consulting and other outside compensated professional work including service on Scientific

                  Advisory Boards or similar boards.

                 Special University activities resulting in payment of a supplemental, one-time extra compensation

                  including overload, faculty consulting, academic incentive payments, or research incentive

                  payments.

                 Volunteer community service unrelated to the University of Pittsburgh.

                 Other activities over and above or separate from assigned responsibilities in the primary position,

                  including serving as a primary editor of a journal.

                 Clinical service effort including activities for the University of Pittsburgh Physicians (UPP) and

                  other affiliated hospitals, including participation in resident training.

                 Veterans Administration Hospital compensated activities documented in a Memorandum of

                  Understanding (MOU).

                 For faculty with Joint Appointments, activities for the institution where the secondary appointment

                  is held.

IV.  POLICY

      In accordance with OMB Circular A-21, the University of Pittsburgh requires the periodic confirmation of

      the distribution of salaries to federal sponsored project accounts.  Salary charges for professorial and

      professional staff are based on individual planned work activity, updated to reflect significant changes in

      work distribution.  Categories of work activity (i.e. sponsored research, teaching, administration, public

      service, etc.) are expressed as percentages of total University activities for which the individual is

      compensated.  The total sum of an individual’s effort percentages must be 100% regardless of the total

      number of hours worked during the Period of Performance.  Note the following examples:

                 A faculty member works an average of 50 hours per week during the Period of Performance.  

                  Of that time, an average of 10 hours per week is devoted to a particular sponsored project.  The

                  correct effort percentage for that project is 20% (10 project hours / 50 total University hours).

                 A faculty member has a .5 FTE appointment, works an average of 25 hours per week and devotes

                  an average of 15 hours per week to a specific sponsored project.  The correct effort percentage

                  for that project is 60% (15 hours on the project / 25 total University hours).  The percentage FTE

                  of an appointment is not considered in the effort calculation because effort is the relationship of an

                  activity to the total University work performed by an individual.  The total body of work performed

                  by an individual will serve as the basis for salary distribution of that individual’s pay; whether it is

                  a full-time salary or something less, the salary is allocated on the percentage of effort for each

                  activity.

     OMB Circular A-21 requires periodic certification of effort statements by the employee, PI, or responsible

     official using suitable means of verification that the work was performed, stating that salaries charged to

     sponsored agreements are reasonable in relation to work performed.  First-hand knowledge of the volume

     and nature of the technical work performed is the preferred criteria.  OMB Circular A-21 provides for the use

     of ‘other suitable means’ of verification as described in the Certification of Effort Statements section.

      Establishment of Salaries on Sponsored Project Accounts – Salary distribution consistent with employee

      effort should be allocated to sponsored project accounts and other University accounts in relation to

      employee activities (i.e. sponsored research, teaching, administration, public service).  This distribution

      is based on each individual’s SPAR data presented as a percentage of planned University effort.  The

      SPAR must reflect effort expended on all activities for which the individual receives compensation from

      the University.  Total effort on the SPAR cannot be more or less than 100%.  It is each faculty member’s

      responsibility to be aware of his/her level of effort on sponsored projects and all other University

      obligations and to communicate any significant change (5% or more) in this distribution of effort to the

      responsible department or school administrator.  The Principal Investigator on an award is ultimately

      responsible for ensuring the reasonableness of effort distributions for all individuals working on his/her

      grants.  Effort allocations must be reviewed and updated as appropriate in a timely manner to ensure

      that percentages on the SPAR are reflective of actual effort expended.  The SPAR system is designed to

      distribute salaries based on work performed, in accordance with OMB Circular A-21, and is not to be

      manipulated to facilitate budget practices.

      Principal Investigator Commitment of Effort – Consistent with federal regulations, all faculty members

      listed as the PI on a sponsored project must contribute some level of effort to that project to provide

      necessary supervision/administration, regardless of the availability of sponsor salary reimbursement.  The

      amount of effort should reflect the time necessary to oversee all aspects of the work, including fulfilling the

      duties of a PI as set forth in University Policy 11-01-02, Rights, Roles and Responsibilities of Sponsored

      Research Investigators.  PIs may not record zero percent effort on a sponsored project.  Any actual effort

      recognized in excess of sponsor salary reimbursement must be cost shared by the department.

      Summer Effort Reporting for Less Than Annual Faculty – Faculty with 8-, 9-, or 10-month academic

      appointments who receive summer salary will continue to report effort on sponsored projects and

      institutional activities in percentages relative to their actual work loads.  During summer months for which

      summer salary is received, effort spent teaching, writing competitive proposals, attending departmental

      meetings, advising students, serving on committees, participating in professional development, or any

      other activities not directly related to a sponsored project must be reported as institutional effort. 

      Departmental salary budget savings from the recognition of sponsored project activities during the

      academic year will be made available to fund summer institutional effort for faculty performing summer

      sponsored research.  Faculty members will need to coordinate the timing of sponsored project activity

      with the responsible  department or school administrator.

      100% Research Activity – Effort statements indicating 100% activity associated with sponsored projects

      will be subjected to additional administrative review.  Faculty who have 100% sponsored project effort will

      be required to complete a justification questionnaire in support of this position.  Upon completion of the

      questionnaire, if it is determined that some institutional effort is warranted, the faculty member should

      contact the responsible department or school administrator to re-distribute effort.  Personnel whose work

      activities include preparation and submission of grant proposals (other than training awards that expressly

      contemplate such activities), teaching, serving on committees, attending departmental meetings, advising

      students, or any other activity not directly related to a sponsored project necessarily have institutional effort

      associated with those activities and therefore cannot report 100% effort on sponsored projects.

      Paid Leave, Unpaid Leave and Extended Leave - Paid leave (such as vacation time and sick leave) for

      eligible faculty, where eligibility is defined by applicable University Policies, may be charged to sponsored

      projects as part of the normal charge for salaries and wages.  If an eligible individual is expending effort on

      multiple sponsored projects at the time of the leave, the charges to the sponsored projects should be

      consistent with the usual salary charges in keeping with the University of Pittsburgh effort reporting policy.

      Unpaid leave is excluded from total University effort, but faculty on unpaid leave may not charge effort or

      work on sponsored projects.

      Extended leave, including sabbaticals, may have an impact on a key person’s ability to meet his/her effort

      commitment to a sponsored project and, therefore, should be considered when determining effort

      distribution.  Typically, if the extended leave lasts for 90 days or more the sponsor must approve the

      extended leave in advance for effort to be charged to a sponsored project.  Where the research involves

      human subject or animal research, or where the leave will take place in a foreign location, the University

      may not permit the investigator to continue to work on the grant while on leave for compliance reasons.

      If, as the result of extended leave, a key person reduces the time that he/she expends on the project by

      25 percent or more of the original commitment, prior approval from the sponsor is typically required.

      Institutional Stance on Cost Sharing – The University of Pittsburgh does not typically propose/commit cost

      share on a voluntary basis, consistent with its objective of maximizing sponsor cost reimbursement to

      support the continued growth of the research enterprise.  A voluntary cost sharing commitment regarding

      effort should be made only where the competitive forces and perceived institutional benefit of receiving

      the award are deemed to be sufficiently strong to warrant the financial obligation.  The signature of the

      Department Chair, Director, and/or Dean on a proposal indicates approval of the voluntary cost share

      commitment.  Where a sponsor expressly limits the amount of salary reimbursement that may be charged

      to a grant, effort reported must reflect actual effort expended on the project with any shortfall in salary

      reimbursement recorded as institutional cost share.

      Certification of Effort Statements – All employees who receive salary support from federally sponsored

      projects, or who expend committed effort on federally sponsored projects without receiving salary support

      from the sponsor, must certify effort in accordance with this policy.  The University requires effort

      statements to be certified three times per year.  The Periods of Performance are as follows:

                                          Period of Performance

                                          September 1 – December 31

                                          January 1 – April 30

                                          May 1 – August 31

      The PI is responsible for certifying effort statements for himself/herself and all employees working on

      his/her federal sponsored projects within a certification window of 45 calendar days following a preliminary

      administrative review period after the financial close of the Period of Performance.  The actual dates for

      the PI certification window will be included in the correspondence to each PI indicating that the effort

      statements are available for review and certification.  Any delay in the pre-certification review by the

      departmental Effort Coordinator will reduce the certification window available to the PI by the number of

      days delayed.  Effort statements must be electronically signed by the employee, PI, or responsible official

      using suitable means of verification stating that salaries charged to federal sponsored agreements are

      reasonable in relation to work performed.  Suitable means of verification would include first-hand

      knowledge of the volume and nature of the technical work performed, a hard copy of an employee’s

      effort statement signed by the PI or other documentation (e.g. laboratory records) from the PI that

      supports the effort percentages on the statement.

      The CFO or his designee will follow up with Department Chairs, Directors, and/or Deans having

      outstanding certifications on sponsored projects in their respective areas after the end of the PI certification

      window to facilitate completion.  All effort statements must be certified within 90 days of the close of the

      Period of Performance.  Following the close of the 90-day certification period, salary and fringe benefit

      costs associated with uncertified effort may be removed from sponsored projects and charged to the unit

      (Department, Center, or Institute) responsible for the sponsored project.

      Salary Reallocations and Re-certification of Effort – In accordance with OMB Circular A-21, reallocations of

      salary charges to sponsored projects are allowable if the expenditure is incurred in the advancement of the

      work for that particular project and meets all other criteria for allowable costs.  Cost reallocations from one

      sponsored project to another to clear overdrafts or to consume unused budgets are not allowable under 

      any circumstances.

      Level reports should be reviewed monthly to identify and correct any erroneous charges to sponsored

      projects.  OMB Circular A-21 provides that, “Short term (such as one or two months) fluctuation between

      workload categories need not be considered as long as the distribution of salaries and wages is reasonable

      over the longer term, such as an academic period.”  Based on this federal guidance, corrections to effort

      distributions may be performed within 90 days from the end of the Period of Performance (academic

      period).  However, if the need to correct an effort distribution is identified during the Period of Performance,

      the corrective reallocation should be made upon discovery, it is not necessary to wait until after the end

      of the Period of Performance.  Salary reallocations should be made prior to the end of the 45-day PI

      certification window to allow for timely certification of effort.  For instances of extenuating circumstances,

      additional time will be allowed to make a salary reallocation and to certify within the 90-day certification

      period following the end of the Period of Performance.

      If a sponsored project ends within a Period of Performance, any salary reallocations should be made within

      90 days of the project end date to facilitate submission of financial, performance and other final reporting

      as required by the sponsor.

      Exceptions For Salary Reallocation Beyond Ninety Days of the End of the Period of Performance

      Any salary reallocation beyond 90 days from the end of the Period of Performance must be requested in

      writing to the Director of Financial Compliance for Research and include a complete explanation of how

      the error occurred, the reason the transfer is late (which must fit one of the exceptions set forth below), a

      certification of the propriety of the charge to the sponsored project, and a corrective action plan to prevent

      similar issues in the future.  Supporting documentation is required for all such requests.

      A request for reallocation beyond 90 days will be denied unless it meets one of the exceptions below:

      1.   Removal from a sponsored project of an inappropriate or expressly unallowable charge regardless of

            lapsed time.

      2.   Removal of charges disallowed by audit or sponsor.

      3.   Reallocation affects only some combination of master and sub-accounts within the same award with

            all accounts involved open and active.

      4.   Early account number request was not approved.  Evidence is required that early account request

            had been submitted.

      5.   Adjustments necessary on training awards to align payments to trainees with federally mandated

            stipend rates.

      6.   Reallocation affects only some combination of non-research accounts and does not cross fiscal years

            if entity 02 (operating).

      If the reallocation affects salaries previously certified, one recertification is allowed within the 90-day

      certification period.  If the reallocation request exceeds the certification period or affects salaries previously

      recertified, the reallocation must be approved by the CFO or his designee before the reallocation/

      recertification can occur.  A request of this nature must be accompanied by detailed explanation of the

      need for reallocation and recertification, approved by the PI and Chair/Director.  Only in the most

      compelling of circumstances will such a request be approved, unless the reallocation benefits the sponsor.

      Responsibility for Compliance Oversight – The CFO or his designee, in consultation with the Provost,

      Senior Vice Chancellor for Health Sciences, University Counsel, Internal Audit and/or Vice Provost for

      Research, will provide continuing oversight for compliance with all federal financial regulations and

      guidelines related to sponsored project administration.

      The Department Chairs/Directors and/or Deans are expected to monitor the progress of effort certification

      and intervene when necessary to facilitate completion.  Notification will be sent to Chairs/Directors and/or

      Deans as the end of the certification period approaches indicating those effort statements not yet certified. 

      The Chairs/Directors and Deans are responsible to ensure that all PIs within their area are in compliance

      with the various aspects of this policy including effort planning, reporting and certification.

      The PI is responsible to plan the effort of himself/herself and those individuals working on his/her

      sponsored projects, monitor the accuracy of those effort estimates, notify the responsible department or

      school administrator of significant changes to effort percentages, and certify the effort based on first-hand

      knowledge of the volume and nature of the technical work performed.

      Sanctions for Non-Compliance – Failure to follow the provisions of this effort reporting policy may subject

      the person(s) responsible for the violation(s) to administrative/disciplinary actions up to and including

      termination from employment.

      Mandatory Training – All faculty and staff who work on sponsored research projects will be required to

      participate in on-going systems and compliance training as deemed necessary by University

      administration.  Failure to complete mandatory training may result in revocation of signature authority

      and/or suspension from participation in sponsored projects.

V.   REFERENCES

      OMB Circular A-21, Section J-10

      NIH Grants Policy Statement

      Policy 11-01-02, Rights, Roles and Responsibilities of Sponsored Research Investigators

      Policy 02-02-12, Length of Appointments

      Policy 02-06-03, Third Term/Session Appointments: Salary Administration