Policy: VIII.C.1A

Issued: January 15, 1988

Owner: Assistant Vice President
for Research Administration in the
Office of Sponsored Programs

Latest Revision: November 7, 2005 (Under Development)


COMPLIANCE WITH FEDERAL SPONSOR REQUIREMENTS

1.0 Purpose

This policy describes major Federal regulations governing the financial administration of federally supported grants and contracts at the University.

2.0 Policy [Top]

2.1 Overview

In accepting a sponsored program, the University assumes responsibility for fulfilling the program, sponsoring agency, and State requirements.  These requirements may be specifically contained in the agreement or they may be incorporated by reference to guidelines issued by the sponsor in special publications or directives.  It is essential that every effort be made to assure sound management practices and that prudent fiscal policies are followed in conducting sponsored programs.  Federal funding is at risk institution-wide if individuals do not comply with these requirements.

Cost accounting and financial compliance for sponsored projects at the University of Virginia is dictated by various federal Office of Management and Budget Circulars and agency regulations. Ensuring compliance with the financial terms and conditions of the sponsored award including compliance with federal and agency regulations and requirements is the responsibility of both the Principal Investigator and the Department Administrator. The following is a brief explanation of the major bodies of federal and agency regulations that address financial compliance related to sponsored programs:

2.2 Office of Management and Budget Circular A-21

OMB Circular A-21, Cost Principles for Educational Institutions, provides cost principle requirements for determining costs applicable to research and development, training and other sponsored projects performed by colleges and universities under grants, contracts and other sponsored agreements with the federal government. OMB Circular A-21 can be referenced at http://www.whitehouse.gov/sites/default/files/omb/assets/omb/fedreg/2005/083105_a21.pdf.

2.3 Cost Accounting Standards

A Cost Accounting Standards Disclosure Statement is a standard federal form (form DS-2) that documents or discloses an organization’s cost accounting practices in a variety of financial areas. A cost accounting practice is any accounting method or technique which is used for measurement of cost, assignment of cost to cost accounting periods or allocation of costs to cost objectives. An educational institution is required to file a CAS Disclosure Statement with its cognizant federal administrative agency if it receives federally sponsored agreements totaling $25 million or more in a fiscal year. The University of Virginia’s cognizant agency is the Department of Health and Human Services.  Administrative responsibility for the Cost Accounting Standards Disclosure Statement at the University resides with the Director of Research Administration Outreach and Compliance in the Office of Sponsored Programs.

The University is subject to a total of four different CAS standards outlined in OMB Circular A-21 and further detailed in Appendix A of Circular A-21. CAS standards can be referenced at http://www.whitehouse.gov/sites/default/files/omb/assets/omb/fedreg/2005/083105_a21.pdf.  See OSP CAS guidelines at http://www.virginia.edu/sponsoredprograms/compliance/CASGuidelines0810.pdf .

CAS 501 Consistency in Estimating, Accumulating, & Reporting Costs: Basis used in estimating costs in proposal budget, charging costs to sponsored agreement and reporting costs to sponsor must be consistent with one another.  See procedure http://www.virginia.edu/finance/polproc/proc/8-14.html Budgeting Direct Costs of Sponsored Programs

CAS 502 Consistency in Allocating Costs Incurred for the Same Purposes: All costs incurred for same purpose, in like circumstances, are either direct costs only or indirect costs only.  See policy http://www.virginia.edu/finance/polproc/pol/viiia6.html Consistent Treatment of Sponsored Program Costs.

CAS 505 Accounting for Unallowable Costs: Unallowable costs must be identified in the accounting system or identifiable from departmental records.  Unallowable costs are identified by departmental function and Integrated System expenditure types, allowed cost schedules, and transaction controls.

CAS 506 Cost Accounting Periods:  The University of Virginia’s fiscal year begins on July 1 and ends on June 30.

2.3 Office of Management and Budget Circular A-110

Office of Management and Budget Circular A-110, Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations, establishes uniform and consistent administrative requirements for federal grants and agreements awarded to institutions of higher education, hospitals, and other non-profit organizations. OMB Circular A-21 can be referenced at http://www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a110/2cfr215-0.pdf.

2.4 Office of Management and Budget Circular A-133

Office of Management and Budget Circular A-133, Audits of States, Local Governments and Non-Profit Organizations, governs the auditing requirements of federal awards made to non-federal entities. OMB Circular A-133 can be referenced at http://www.whitehouse.gov/sites/default/files/omb/assets/omb/circulars/a133/a133.pdf.

3.0 Definitions [Top]

4.0 References [Top]

5.0 Approvals and Revisions [Top]

       Previous version in effect from 1/15/88 to 7/6/00 available in policy archive.
       Previous version in effect from 7/7/00 to 6/30/02 available in policy archive.

 

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