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Policy No.: 6105
Effective Date: 06/01/06
Revised Date: 06/11/15
Reviewed Date: 06/11/15

Effort Certification Policy

Basis for Policy

Acceptance of federal awards obligates the University of Nebraska Medical Center (UNMC) to comply with the federal government’s rules, regulations and guidelines applicable to sponsored programs. Federal cost principles per the OMB circular A-21 “Cost Principles for Educational Institutions” require costs to be properly allocated to the program that received the benefits of the costs incurred. See UNMC Policy No. 6100, Direct Cost for additional information.

The Effort Certification system is UNMC’s process for ensuring compliance with the payroll distribution requirements of the Office of Management and Budget (OMB) Circular A-21, which addresses "principles for determining costs applicable to grants, contracts, and other agreements with educational institutions." The policies, provisions, and cost accounting standards in A-21 are mandatory for institutions which directly or indirectly receive federal funds.

In describing how to best track effort on federal projects, OMB Circular A-21 states the following: "In the use of any methods for apportioning salaries, it is recognized that, in an academic setting, teaching, research, service, and administration are often inextricably intermingled. A precise assessment of factors that contribute to costs is not always feasible, nor is it expected. Reliance, therefore, is placed on estimates in which a degree of tolerance is appropriate." UNMC has determined 5 percentage points is a reasonable degree of tolerance for effort reporting estimates.

OMB Circular A-110 Subpart C .25 (c)(3) states that “the absence for more than three months, or a 25 percent reduction in time devoted to the project by the approved project director or principal investigator” requires the prior approval of the federal sponsoring agency.

Policy

UNMC uses the Effort Certification Report as its method of documenting employee effort performed on federal projects. In regard to an Effort Certification Report, OMB Circular A-21 stipulates the following requirements:

• Activity reports will reflect the distribution of activity expended by employees covered by the system.
• These reports will reflect an after-the-fact reporting of the percentage distribution of activity of employees. Charges may be made initially on the basis of estimates made before the services are performed, provided that such charges are promptly adjusted if significant differences are indicated by activity records.
• Reports will reflect a reasonable estimate of the activities for which employees are compensated by the institution. To confirm that the distribution of activity represents a reasonable estimate of the work performed by the employee during the period, the reports will be signed by the employee, principal investigator, or responsible official(s) using suitable means of verification that the work was performed. The person who signs the report must have first-hand knowledge of the activity of the employee that is being reported on the Effort Certification Report.
• The system will reflect activity applicable to each sponsored agreement and to each category needed to identify facilities and administrative costs and the functions to which they are allocable.

Effort Certification Report Process

The Effort Certification Report provides the basis for certifying that salaries are charged to programs/projects in accordance with the relative activity applied to various programs and projects. The Effort Certification Report constitutes the primary basis for reimbursement to UNMC by the federal government for salaries paid from sponsored research, sponsored instruction, and other sponsored activities, as well as providing the basis for certain costs that are reimbursed as facility and administrative costs. The Effort Certification Report also provides the means of identifying cost sharing activity on sponsored programs.

The information reported by departments for the period being reported reflects the actual effort of each employee, as well as it can be estimated or measured. Reports are prepared for employees who are paid at least partially from federally sponsored projects or having cost sharing activity.

Sponsored Programs Accounting is responsible for the administration of the Effort Certification Report system. Effort Certification Reports are generated by Sponsored Programs Accounting and distributed to departments for review and certification. Effort Certification Reports will be completed using the electronic Effort Reporting system in RSS (Research Support System) on the UNMC intranet. Certification is due 30 days after distribution by Sponsored Programs Accounting and is considered delinquent after 30 days. After 30 days, notice will be sent according to the scheduled process below unless extension has been granted by the Manager of Sponsored Programs Accounting.

Upon certification of an Effort Certification Report, the report is saved electronically and cannot be changed. If after certification of an Effort Certification Report a retroactive payroll transfer is made (UNMC Policy No. 6106, Cost Transfer), a recertification will be required (see Effort Recertification Procedure). A Recertification Report will be generated by Sponsored Programs Accounting and will be subject to the due dates and notice schedule in the Recertification Procedure.

It is the Principal Investigator’s (PI) and his/her department’s responsibility to accurately complete the Effort Certification Report. Failure to complete the Effort Certification Report requirements will be grounds for corrective action up to and including placing a hold on research funding. Notices will be sent according to the guidelines below:

Days after Effort Certification Report distribution	Notification Process
30	Email notification sent to department effort reporting coordinator and administrator.
40	Memo from Sponsored Programs Accounting will be sent to department effort reporting coordinator, administrator, PI, chair and dean.
50	Letter from Vice Chancellors for Business & Finance and Research sent to department administrator, chair and dean.
60	Current grant funding for PI will be locked and no new grant accounts will be set up for the department.

Note on Uniform Guidance

The Office of Management and Budget’s (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (2 CFR Part 200) is known as the “Uniform Guidance” or UG as follows in this policy. Uniform Guidance became effective for all new and competing renewal awards for all Federal Agencies issued after December 26, 2014 and supersedes requirements from several circulars including A-21, A-110, and A-133. Until further notice, UNMC is choosing to retain UNMC’s web based Effort Certification System as an internal control to verify payroll to fulfill Uniform Guidance §200.430 Compensation of personal services.

Additional Information

• Any questions about this policy should be referred to Financial Compliance and Cost Analysis or Sponsored Programs Accounting.
• Effort Certification Procedure
• Effort Certification Report (ECR) User Guide
• Recertification Procedure

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