Healthy Grants August 18 Webinar FAQs

Grant recipients can access Financial Management Requirements for Award Recipients on the HRSA Manage Your Grant webpage. This is a guide to assist grant recipients in ensuring that adequate management controls are incorporated when writing or updating fiscal policies and procedures.

You can find the reporting requirements for your specific grants on your Notice of Award (NOA). In addition, information about reporting requirements is available on the Manage Your Grant webpage.

Prior approvals are required for significant rebudgeting. Significant rebudgeting is defined as budget modifications in excess of 25% of the total award or movement to a category that was not previously approved. Reach out to your PO and GMS for additional information on prior approvals.

HRSA does not have templates that recipients are required to use to track expenses as there are various systems and ways in which expenditures can be tracked. Per 45 CFR 75.302 recipients must have a financial management system which provides accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements. Please reach out to your GMS if you would like additional guidance on how to best track expenses at your organization.

The P&L alone would not be adequate documentation to identify that costs are allowable, reasonable and allocable to a federal award as required per 45 CFR 75.403. As further described in 45 CFR 75.302 all records must be supported by source documentation (invoices, receipts, mileage logs, etc.). The financial management system of each non-federal entity must provide for records that identify adequately the source and application of funds for federally-funded activities. These records must contain information pertaining to federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation.

Fee amounts in the budget justification would not suffice. While consultants, speakers, etc. are paid on industry norms, adequate supporting documentation should be that used for all costs charged to a federal award. This includes, but is not limited to, contracts, evidence of approval for the individual(s), cancelled checks showing the amounts that were actually paid, travel logs, or connection to the grant in the general ledger. According to 45 CFR 75.403(i)(C), The non-Federal entity's system of internal controls includes processes to review after-the-fact interim charges made to a Federal award based on budget estimates. All necessary adjustment must be made such that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Additionally, for all costs charged to a federal award the cost must be allowable, reasonable and allocable to a federal award as required per 45 CFR 75.403.

Yes, it is allowable to treat all costs as direct costs if it follows your organizations policies and procedures and is used consistently across all sources of funding. Your organization must have documentation to identify how costs are charged and in order for costs to be allowable all costs charged to an award must be allocable to that award and you need to maintain documentation of the allocability. For example, rent charges can only be the portion of the rent that pertains directly to the award - one way to do this would be charging only the portion of square footage occupied by the direct staff working on the grant.

Your organization should develop an allocation plan and address any of the costs you will be allocating across multiple sources of funding. The key is ensuring consistency for a particular cost across all the sources of funding; however, you have the flexibility to determine what basis to use for allocation. Some examples we have seen are square footage, full-time equivalent charge, percentage of total revenue, and mileage.

If a non-federal entity receives several federal grants, they may want to negotiate an indirect cost rate agreement since the rate will be accepted by all federal agencies. See 45 CFR 75 for more information.

The purpose of an indirect cost rate agreement is to publish the reimbursement rate(s) negotiated between the federal government and a grantee organization which reflects the indirect costs (e.g.; facilities and administrative costs) and fringe benefit expenses incurred by the organization in the conduct of federal programs. The rate agreement includes, but is not limited to identifying the type of rate(s) negotiated, the effective period(s) of the rate(s), the rate expressed as a percentage, the location to which the rate is applicable, and to what programs the rate is applicable to. It also defines the base(s) used to develop the rate(s), the treatment of fringe benefits and paid absences, and the capitalization level for equipment.

When a recipient prepares a proposal, the CAS will review the proposal to determine if it complies with the Uniform Guidance and applicable Appendix to Title 2 of the Code of Federal Regulations, Part 200 (2 CFR 200), to verify that the costs are allowable and are allocated in accordance with relative benefits received. The CAS will contact the organization if additional information is needed to clarify issues raised during the review. Subsequent to a desk or on site review, the CAS will enter into negotiations with the organization to establish the rate(s) that appear on the negotiation agreement.

It is necessary to have indirect cost rate agreements to streamline the process of “awarding,” “monitoring” and “closing out” Federal grants and contracts. When a grant or contact officer issues an award to an organization, he/she is unaware of the indirect costs that will be associated with conducting the program.

Indirect expenses such as executive administration, payroll, accounting, human resources, building and equipment depreciation, utilities, janitorial and maintenance are difficult to identify directly to grants and contracts. The indirect cost rate allows the grant or contract officer to calculate the appropriate allocation of indirect costs associated with any one project by applying the negotiated indirect cost rate to the respective base used to develop the rate.

HHS CAS rates generally our rates are accepted by all Federal agencies. The same would be true of rates issued by other rate-setting agencies (Office of Naval Research - Indirect Cost Branch, Department of Interior – Indirect Cost Services).

The lease for location A would be an indirect cost. Direct costs are costs that are directly attributable to patient care. Examples of direct costs include: nursing services, drugs, or medical supplies. Indirect costs are costs that are not directly related to patient care. Examples of indirect costs include: general administration (which includes business office and human resources), health records, information technology, physical plant and maintenance, and renting or leasing of the space in which patient care is provided.

Varying rates are allowable in accordance with the terms of the negotiated agreement. According to 45 CFR 75, Appendix III, Section C.7.a., regarding Fixed Rates for the Life of the Sponsored Agreement, …Federal agencies must use the negotiated rates for indirect (F&A) costs in effect at the time of the initial award throughout the life of the Federal award. Award levels for Federal awards may not be adjusted in future years as a result of changes in negotiated rates. “Negotiated rates” per the rate agreement include final, fixed, and predetermined rates and exclude provisional rates. “Life” for the purpose of this subsection means each competitive segment of a project. A competitive segment is a period of years approved by the Federal awarding agency at the time of the Federal award. If negotiated rate agreements do not extend through the life of the Federal award at the time of the initial award, then the negotiated rate for the last year of the Federal award must be extended through the end of the life of the Federal award.

HR expenses are typically indirect costs. However, organizations must have documentation to identify how direct costs are charged. In order for costs to be allowable, all costs charged to an award must be allocable to that award and you need to maintain documentation of the allocability.

No. Per 75 CFR 75.449 costs incurred for interest on borrowed capital, temporary use of endowment funds, or the use of the non-Federal entity's own funds, however represented, are unallowable.

The best reasonably available interest-bearing account would not be expected to earn interest in excess of $500 per year on Federal cash balances. Interest earned amounts up to $500 per year may be retained by the non-Federal entity for administrative expense. Any additional interest earned on Federal advance payments deposited in interest-bearing accounts must be remitted annually to the Department of Health and Human Services Payment Management System (PMS). Refer to 45 CFR 75.305.

Effective January 2020, the Executive Level II salary level is $197,300 which is an increase from 2019 when it was $192,300. As the salary cap limitations may change each year, budgeted amounts should also be adjusted. HRSA issues an annual External Grants Policy Bulletin notifying recipients of any changes to the salary cap.

Effective January 2020, the Executive Level II salary level is $197,300 which is an increase from 2019 when it was $192,300. As the salary cap limitations may change each year, budgeted amounts should also be adjusted. HRSA issues an annual External Grants Policy Bulletin notifying recipients of any changes to the salary cap.

Income generated by an award recipient is by definition considered program income; however, depending under which legislative authority their award is funded, can also determine how an award recipient may allocate their rebate funds. The definition of program income in the Uniform Guidance, 45 CFR 75, is: “Program income means gross income earned by the non-Federal entity that is directly generated by a supported activity or earned as a result of the Federal award during the period of performance except as provided in §75.307(f).”

For example, if the award originates under the Ryan White HIV/AIDS program, the rebate is subject to all the same terms and conditions as any other award money. So in this scenario the rebate funds would be subject to the salary cap requirement.

However, in an example where the award originated under the Bureau of Primary Health Care program, “the health center must use any non-grant funds as permitted under section 330, and may use such funds for such other purposes as are not specifically prohibited under section 330, if such use furthers the objectives of the [health center] project.” Therefore, BPHC funds are not necessarily subject to the same terms and conditions as long as they are reinvested in the health center.

If a recipient is unsure whether their rebate funds are subject to the same terms and conditions, they should contact their Grants Management Specialist or Project Officer to get clarification.

Effective January 2020 the Executive Level II salary level is $197,300 which is an increase from 2019 when it was $192,300. As the salary cap limitations may change each year, budgeted amounts should also be adjusted. HRSA issues an External Grants Policy Bulletin notifying recipients of any changes to the salary cap.

This would be allowed; however, the U.S. Department of Transportation issued an enforcement notice on Friday, April 3, 2020, clarifying air carrier refund requirements, given the impact of COVID-19. It notes that U.S. and foreign airlines remain obligated to provide a prompt refund to passengers for flights to, within, or from the United States when the carrier cancels the passenger’s scheduled flight or makes a significant schedule change and the passenger chooses not to accept the alternative offered by the carrier. The obligation of airlines to provide refunds, including the ticket price and any optional fee charged for services a passenger is unable to use, does not cease when the flight disruptions are outside of the carrier’s control (e.g., a result of government restrictions). The notice can be found here: DOT Enforcement Notice(PDF- 26 KB).

Further, HRSA recipients may charge full cost of cancellation when the event, travel, or other activities are conducted under the auspices of the grant; for the period OMB M-20-17 (PDF- 5.4 MB) was in effect: March 19, 2020 – June 16, 2020.

Recipients should not assume that additional funds will be available should the charging of cancellation or other fees result in a shortage of funds to eventually carry out the event or travel. Recipients must maintain appropriate records and cost documentation as required by 45 CFR 75.302 - Financial management and standards for financial management systems and 45 CFR 75.361 - Retention requirement for records to substantiate the charging of any cancellation or other fees related to interruption of operations or services.

HRSA recommends that grant recipients first consult their organizational policies and procedures for suitability to work from home, potential acceptable grant duties while working from home, and processes for reimbursements. Allowable costs under a HRSA grant, would be permissible for reimbursement to an employee approved to work on grant duties at home due to COVID-19 (2 CFR § 200.403; 2 CFR § 200.404; 2 CFR § 200.405) in accordance with the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HHS Awards (45 CFR Part 75) and consistent with the recipient’s organizational policies and procedures.

The best way to determine the amount of time and effort an individual is spending dedicated to a specific grant is to conduct a time study and have the individuals record their time and activity for a designated period of time. This time study will help you determine actual charges to an award and for submitting or updating your budget. As a reminder, only actual time can be charged to an award. Therefore, if the individuals are consistently working 25% FTE on a grant you can charge the entire actual amount as long as you have supporting documentation for these charges. There can be some variability in charges from your budget; however, if the increase in salaries charged to the award increases by more than 25% of the total award amount you will need to request prior approval from your Grants Management Special (GMS). Reach out to your GMS for additional information about rebudgeting.

For simplicity - you can maintain supporting documentation through an email chain. Or you can complete it through an electronic signature with an Adobe PDF if you have this functionality. If your payroll system is electronic and allows you to input information, then you can document it in the payroll system as well.

No. As a reminder this is what you need to be in compliance with Compensation—personal services per 45 CFR 75.430(i))

• For costs to be allowable under a federal grant they must be:
• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

In accordance with 45 CFR 75.430(i)(1), charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. With that in mind, allocating salary amounts to COVID-19/pandemic response follows best practice for all grants. First, it is always a best practice to maintain detailed records. This includes, but not limited to, measuring, documenting and reporting the percentage of effort expended on the federal award, with specificity regarding which function or cost center; documenting the hours worked and identifying the grant or funding source. This should be completed for all employees and signed by the employee and certified by the supervisor. In addition, the process should be included in your policies and procedures.

In the example if Susan is 100% funded to the grant all costs for her salaries and fringe benefits can be charged to an award, including paid days off. Paid days off can be charged in proportion to the direct charges made to an award.

Paid days off can be charged in proportion to the direct charges made to an award. If an employee is 100% funded to the grant all costs for their salaries and fringe benefits can be charged to an award, including paid days off.

If an employee is 100% funded to the grant all costs for their salaries and fringe benefits can be charged to an award, including paid days off. Paid days off can be charged in proportion to the direct charges made to an award.

Reconciliations are required if your organization draws fund from the Payment Management System (PMS) for salaries based on budget estimates. You must have a process in place to reconcile and adjust the amounts that differ between budget estimates and actual time spent dedicated to the award (based on time and effort records). As a reminder, only actual time is an allowable cost on a federal award.

It may be sufficient depending on your organization’s policies and procedures and your method for tracking and reporting the percentage of effort. Feel free to email OFAMFTA@hrsa.gov and we can provide you with additional clarification as to the adequacy of your particular process.

There is no prescribed method for tracking time and effort. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)). For compensation for personal services costs to be allowable under a federal grant they must be:

• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

You can see some examples of best practices in the Time and Effort Reporting slides 34 – 43.

There is no prescribed method for tracking time and effort. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)). For compensation for personal services costs to be allowable under a federal grant they must be:

• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

You can see some examples of best practices in the Time and Effort Reporting slides 34 – 43.

There is no prescribed method or required documentation for tracking time and effort. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)). For compensation for personal services costs to be allowable under a federal grant they must be:

• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

Your documentation should be sufficient to identify that the work the physician was providing was in scope to your Health Center operations if you have an H80 award. Please reach out to your GMS for additional guidance on how to track time and effort for your organization and your award.

As a best practice, you should have a process in place to review and approve time and effort records. However, there is no prescribed method for tracking time and effort and no specific requirements as to who approves the time and effort reports. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)).

If you are referring to fringe benefits, the portion of fringe benefits which are proportionally related to salaries charged to an award are allowable costs to a grant. Benefits such as paid time off can be charged to an award in the proportion to the direct salaries charged to the award. For examples on including paid time off or vacation days on time and effort records refer to Time and Effort Reporting slides 40 – 41 .

We did not address electronic time keeping as it is not required and varies across organizations. Electronic time keeping and time and effort reports are allowable and follow the same requirements under 45 CFR 75.430(i)). For compensation for personal services costs to be allowable under a federal grant they must be:

• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

Depending on your policies and procedures and the information contained on your biweekly timesheet it may be considered certification of time and effort. Without reviewing and verifying your process we cannot provide you assurance that this is sufficient to show compliance with 45 CFR 75.430. Feel free to email OFAMFTA@hrsa.gov and we can provide you with additional clarification as to the adequacy of your particular process.

Please reach out to your GMS for information about grant specific reports. In addition, if you need additional clarification on the time and effort process please feel free to reach out to OFAMFTA@hrsa.gov.

There is no prescribed method for tracking time and effort. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)). For compensation for personal services costs to be allowable under a federal grant they must be:

• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

As a best practice, you should have a process in place to review and approve time and effort records. However, there is no prescribed method for tracking time and effort and no specific requirements as to who approves the time and effort reports. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)).

As a best practice, you should have a process in place to review and approve time and effort records. However, there is no prescribed method for tracking time and effort and no specific requirements as to who approves the time and effort reports. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)).

As a best practice, you should have a process in place to review and approve time and effort records. However, there is no prescribed method for tracking time and effort and no specific requirements as to who approves the time and effort reports. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)).

Exempt employees should still track the hours they work by the grant projects worked on throughout the pay period. Exempt employees are not exempt from the time and effort reporting requirements simply because they do not report hours each pay period.

Policies and procedures over time off/PTO varies from recipient to recipient. The key takeaway for time off/PTO is that is it allocated to the grant based on a beneficial relationship.

It is a best practice to have an employee sign and the supervisor approve the time and effort records. However, there is no prescribed method or required documentation for tracking time and effort. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)). For compensation for personal services costs to be allowable under a federal grant they must be:

• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

Yes PTO is considered part of a personnel’s salary cost and can be allocated to the grant based on the same beneficial relationship as regular hours.

Every recipient’s policies and procedures over direct and indirect costs is different. However, assuming that both direct and indirect charges are charged to the HRSA grant, the holiday and days off would be allocated to the HRSA grant on the same beneficial relationship (proportion) as the regular hours (direct and indirect) worked during the pay period. For example, if both the direct and indirect HRSA grant related work for the pay period accounted for 40% of the total hours worked during the pay period, 40% of the PTO/holiday can be allocated to the HRSA grant.

The electronic system would be in compliance as long as the system:

• Is supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, it would be in compliance with the time and effort reporting requirements.
• Is incorporated into the official records
• Reasonably reflects the total activity for which the employee is compensated
• Encompasses all compensated activities
• Complies with established accounting policies and practices; and
• Supports the distribution of salaries and wages.

Your organization should document your process for time and effort reporting in your policies and procedures to encompass all the requirements per 45 CFR 75.430(i) as listed above. Feel free to email OFAMFTA@hrsa.gov and we can provide you with additional clarification as to the adequacy of your particular process.

We do not make recommendations as to specific degree of reasonableness. However, it is required that if you are using estimates to approximate the work performed dedicated to a grant that you also reconcile those estimates to reflect the actual work performed. Budget estimates alone cannot be used as support for charges to the federal award but can be used for interim accounting purposes if:

• The approximations are reasonable,
• Significant changes to the work activity are identified and updated in a timely manner,
• They are supported by a system of internal controls to review after the fact interim changes, and
• Adjustments are made such that the final amount charged to the award is accurate, allowable, and properly allocated.

The best way to determine the amount of time and effort an individual is spending dedicated to a specific grant is to conduct a time study and have the individuals record their time and activity for a designated period of time. This time study will help you when submitting or updating your budget.

If these employees provide beneficial work to the grant program, then their wages and salaries are chargeable to the grant. Most likely these are indirect labor employees. In which case, it is up to the recipient to determine the method of allocating the indirect labor costs to the grant. An example might be to allocate accounting costs based on percentage of direct labor charges.

Paid days off can be charged in proportion to the direct charges made to an award. If an employee is 100% funded to the grant all costs for their salaries and fringe benefits can be charged to an award, including paid days off. Depending on the method your organization uses to document time and effort you may need to include this in your documentation. At a minimum the process should be outlined in your policies and procedures.

PTO is typically considered part of the personnel salaries cost however could vary from organization to organization. Paid days off (PTO) can be charged in proportion to the direct charges made to an award. For example, if any employee dedicated 30% of their time to a HRSA grant and also took PTO during the pay period, 30% of the PTO can also be allocated to the HRSA grant.

As a best practice, you should have a process in place to review and approve time and effort records. However, there is no prescribed method for tracking time and effort and no specific requirements as to who approves the time and effort reports. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)).

Contractors are not required to document time and effort in the same capacity as employees whose salary is charged to a federal grant.

Assuming the 330 grant is your only grant, you would record 43% of the employee’s salary to the 330 grant and the remaining portion not covered by the grant would be recorded as being paid from program income.

The 330 grants are unique in that all time may be dedicated to the award (for in scope activities) but the entire salary may not be charged to the award. In this case, you could always use a Compliance certification attesting that 100% of time worked is dedicated to the 330 grant and then have a documented process for charging the time to the grant. For example a reconciliation or other methodology for documenting why you selected 43% of the individual’s salary to be charged to the 330 grant. Feel free to email OFAMFTA@hrsa.gov and we can provide you with additional clarification as to the adequacy of your particular process.

If this is in reference to the executive compensation cap, then only the amount up to the cap is chargeable to the 330 grant. The remaining amount not covered from the 330 grant would have to come from other funding sources and for 330 grants program income is a permissible source.

The 330 grants are unique in that all time may be dedicated to the award (for in scope activities) but the entire salary may not be charged to the award. In this case, you could always use a Compliance certification attesting that 100% of time worked is dedicated to the 330 grant and then have a documented process for charging the time to the grant. Feel free to email OFAMFTA@hrsa.gov and we can provide you with additional clarification as to the adequacy of your particular process.

Budget estimates alone do not qualify as support for charges to the federal award. However, estimates may be used for interim accounting purposes if:

• Approximations are reasonable;
• Significant changes to the work activity are identified (and updated) in a timely manner;
• Supported by a system of internal controls to review after-the-fact interim charges;
• Adjustments are made such that the final amount charged to the award is accurate, allowable, and properly allocated.

As a best practice, you should have a process in place to review and approve time and effort records. However, there is no prescribed method for tracking time and effort and no specific requirements as to who approves the time and effort reports. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)).

A Compliance Certification is a best practice for time and effort reporting utilizing an attestation statement. It can be implemented at an organization to ensure compliance with the requirements per 45 CFR 75.430(i) Compensation—personal services. Based on recommendations from Single Auditors we suggest this compliance certification be completed no less than semi-annually. Recipients must document their process for tracking time and effort, incorporate it into official records and support it with a system of internal controls. In addition, the compliance certifications must encompass all compensated activities and reflect the total activity for which an employee is compensated. See examples for Compliance Certifications in the Time and Effort Reporting slides 34 – 36.

A Compliance Certification is a best practice for time and effort reporting utilizing an attestation statement. It can be implemented at an organization to ensure compliance with the requirements per 45 CFR 75.430(i) Compensation—personal services. Based on recommendations from Single Auditors we suggest this compliance certification be completed no less then semi-annually. Recipients must document their process for tracking time and effort, incorporate it into official records and support it with a system of internal controls. In addition, the compliance certifications must encompass all compensated activities and reflect the total activity for which an employee is compensated. See examples for Compliance Certifications in the Time and Effort Reporting slides 34 – 36.

A Compliance Certification is a best practice for time and effort reporting utilizing an attestation statement. It can be implemented at an organization to ensure compliance with the requirements per 45 CFR 75.430(i) Compensation—personal services. Based on recommendations from Single Auditors we suggest this compliance certification be completed no less then semi-annually. Recipients must document their process for tracking time and effort, incorporate it into official records and support it with a system of internal controls. In addition, the compliance certifications must encompass all compensated activities and reflect the total activity for which an employee is compensated. See examples for Compliance Certifications in the Time and Effort Reporting slides 34 – 36.

The biannual compliance certifications are a best practice for time and effort reporting utilizing an attestation statement. It can be implemented at an organization to ensure compliance with the requirements per 45 CFR 75.430(i) Compensation—personal services. Based on recommendations from Single Auditors we suggest this compliance certification be completed no less then semi-annually. However, recipients must document their process for tracking time and effort, incorporate it into official records and support it with a system of internal controls. In addition, the compliance certifications must encompass all compensated activities and reflect the total activity for which an employee is compensated.

Yes. There is no prescribed method or required documentation for tracking time and effort. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)). For compensation for personal services costs to be allowable under a federal grant they must be:

• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

Yes. The certification statement or any other method of time and effort reporting must encompass all compensated activities and reflect the total activity for which an employee is compensated. See examples for Compliance Certifications in the Time and Effort Reporting slides 34 – 36.

For all costs charged to a federal award the cost must be allowable, reasonable and allocable to a federal award as required per 45 CFR 75.403. As further described in 45 CFR 75.302 all records must be supported by source documentation. Per 45 CFR 75.430 in order for compensation for personal services costs to be allowable under a federal grant they must be:

• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

Therefore, while it is not prescribed in the CFR that a certification is required, it is one of the best practices and ways your organization can show compliance with the requirements and attest that the individuals time worked was in fact allocable to the federal award the salary is being changed against.

There is no prescribed method for tracking time and effort. You have the flexibility to implement a process that works best at your organization as long as you are able to show compliance with 45 CFR 75.430(i)). For compensation for personal services costs to be allowable under a federal grant they must be:

• Be supported by a system of internal controls;
• Be incorporated into official records;
• Reasonably reflect total activity for which employee is compensated;
• Encompass all compensated activities (federal and non-federal);
• Comply with established accounting policies and practices; and
• Support distribution of salary and wages.

A Compliance Certification is a best practice for time and effort reporting utilizing an attestation statement. It can be implemented at an organization to ensure compliance with the requirements per 45 CFR 75.430(i) Compensation—personal services. Based on recommendations from Single Auditors we suggest this compliance certification be completed no less then semi-annually. Recipients must document their process for tracking time and effort, incorporate it into official records and support it with a system of internal controls. In addition, the compliance certifications must encompass all compensated activities and reflect the total activity for which an employee is compensated. See examples for Compliance Certifications in the Time and Effort Reporting slides 34 – 36.