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Creighton University

Accounting Policies

POLICY TITLE:

Personnel Activity Reporting

POLICY NUMBER:

CAPL 06

DATE ISSUED: 

October 2006

DATE REVISED:

October 2009

PURPOSE

As a condition of receiving federal funding, institutions must maintain an accurate system for reporting the percentage of time that employees devote to federally sponsored projects. An effort reporting system provides the principal means for certifying that the salaries and wages charged to federally sponsored projects are consistent with the effort contributed. All employees involved in certifying effort must understand that severe penalties and funding disallowances could result from inaccurate, incomplete, or untimely effort reporting. Creighton must comply with the guidelines established in OMB Circular A-21, Section J.10 Compensation for personal services.

POLICY

Creighton University has elected to report effort on sponsored projects via the after the fact activity method as described in OMB Circular A-21, Section J.10.c(2). Under this system the distribution of activities by Creighton University employees paid on government grants will be supported by periodic reports confirming that effort expended on these projects closely approximates the actual salary distribution for the period. Other employees not directly paid from a grant but required to complete a Personnel Activity Report (PAR) are employees who spend time working on a grant (cost share).  Supplemental compensation is excluded from the reporting process. Personnel Activity Reports will be distributed to departments based on pay cycles. They should be reviewed, modified if appropriate, signed by the employee and returned to the Controller's Office within a reasonable time.

SCOPE

This policy should be known and understood by the following groups of individuals

  • Vice Presidents
  • Deans
  • Department Chairs
  • Directors
  • Department Administrators
  • Principal Investigators
  • Other Accounting/Finance Personnel
  • Grants Administration Personnel
  • Controller's Office Personnel
  • Internal Audit Personnel

DEFINITIONS

Cost Sharing is mandatory or voluntary effort expended on one fund and paid for by another fund (typically a departmental fund). Mandatory cost sharing is required by certain sponsors and is stated in the award documents. Voluntary cost sharing represents additional effort expended on the project that is not required by the agency. For a detailed definition, see the Cost Sharing Policy and Procedure in the Controller's Office Policies and Procedures Manual.

Employee Action Form (EAF) is a document prepared by the department for each employee and submitted to Human Resources. It allows the charging of salary and wages to designated funds. These documents include information about an employee's appointment(s) and funds from which the employee is paid.  EAFs affect an employee's pay in future pay periods.

Effort is work or the proportion of time spent on any activity and expressed as a percentage of total time worked. Total time worked is based on total hours worked during the week and could be greater than 40 hours. Total effort for an employee must equal 100%. Salaries and wages charged to sponsored projects must be based on effort expended.

PAR Coordinator is the effort reporting administrator at the department level who facilitates the distribution and submission of the PAR reports.

PROCEDURES

Salaried Employees

The Payroll system generates a PAR for each individual receiving any portion of his/her salary and wages from Government sponsored research. The system will not generate a PAR report for anyone receiving a special pay charged to account code 6211.

The PAR Coordinator will receive the PARs plus a control sheet listing the employees in their department receiving a PAR. The PARs are generated after each monthly pay period. The purpose of the control sheet is to assure that all PARs are accounted for, distributed and returned within a reasonable timeframe for certifying effort. The PAR Coordinator should review the control sheet to determine if all applicable PAR forms for the reporting period have been received. A PAR form will need to be created by the PAR Coordinator for any personnel who expend effort on a Government grant and do not receive compensation on that grant (cost share).  In addition, the first month an employee expends effort on a Government grant, the PAR Coordinator will need to create a PAR.  In this circumstance the PAR Coordinator should verify an EAF has been processed to reflect the appropriate level of effort so future PARs will be automatically generated.

The PARs are given to each employee to be completed and signed. If the employee is unable to sign the PAR, the Principal Investigator, immediate supervisor or other responsible official (i.e. department administrator) can sign in their absence as long as the signing official has suitable means to verify the work was performed.  The PAR Coordinator is responsible for collecting the completed, signed PARs. The PAR coordinator should review the completed PARs before returning them to the Controller's Office. Items to check are:

  • All reports distributed have been returned. (note date of termination on form, if applicable)
  • All reports are signed and dated (all signatures must be in ink).
  • % Time Worked column sums to 100.
  • % Cost Share Time column sums to 0.
  • Fund and Organization codes are correct.
  • Note any variances greater than 5% between % Time Worked and % Paid after consideration for any applicable salary cap. If an employee will continue to work at the new level of effort reported, generate an EAF to change the salary distribution for future pay periods and prepare a journal entry to correct the current pay period.  If the variance only relates to the current pay period, prepare a journal entry to correct the current pay period.

For any faculty member with Institutional Base Salary (IBS) above the NIH salary cap, the amount above the cap wil be reported on the PAR as cost share.  The current NIH salary cap amount can be found at http://www.grants.nih.gov/grants/policy/salcap_summary.htm.  The actual effort % will be shown on the line with the related NIH grant.  In the % Cost Share Time column, show the percentage of effort that relates to the amount of the excess salary over the cap as a negative on the NIH grant line and a positive on the appropriate UDF/GCF line.  To calculate the percentage of effort that needs to be cost shared, apply the proposed effort % to the amount the IBS exceeds the salary cap.  Divide this amount into the actual IBS to arrive at the cost share %.  See example below:

Full Salary            Salary Cap             Excess                 Effort %                Cost Share $           Cost Share %

$255,000               $196,700                $58,300                   10%                           $5,830                      2.3%

Attach the control report to the completed PARs and return to the Controller's Office within 30 days from the distribution date.

Hourly Employees

The PAR Coordinator will receive the PARs plus a control sheet listing the employees in their department receiving a PAR. The Payroll system generates a PAR for each individual receiving any portion of his/her salary and wages from Government sponsored research.  Employees must ensure the hours reported on the PAR are consistent with the hours reported on their timesheet for the same pay period.

The purpose of the control sheet is to assure that all PARs are accounted for, distributed and returned within a reasonable timeframe for certifying effort. The PAR Coordinator should review the control sheet to determine if all applicable PAR forms for the reporting period have been received.  A PAR form will need to be created by the PAR Coordinator for any personnel who expend effort on a Government grant and do not receive compensation on that grant (cost share).  In addition, the first pay period an employee expends effort on a Government grant, the PAR Coordinator will need to create a PAR.  In this circumstance the PAR Coordinator should verify an EAF has been processed to reflect the appropriate level of effort so future PARs will be automatically generated.

The PARs are given to each employee to be completed and signed. If the employee is unable to sign the PAR, the immediate supervisor, Principal Investigator, or other responsible official (i.e. department administrator) can sign the PAR in their absence as long as the signing official has suitable means to verify the work was performed. The PAR Coordinator is responsible for collecting the completed, signed PARs from each employee.  The PAR Coordinator should review the completed PARs before returning them to the Controller's Office.  Items to check are:

  • All reports distributed have been returned (note date of termination on form if applicable).
  • All reports are signed and dated (all signatures must be in ink).
  • Hours worked equal hours reported on the individual's time sheet.
  • Cost Share Hours column sums to 0.
  • Fund and Organization codes are correct.
  • Note any variances greater than 5% between % Hours Worked and % Paid. If an employee will continue to work at the new level of effort reported, generate an EAF to change the salary distribution for future pay periods and prepare a journal entry to correct the current pay period.  If the variance only relates to the current pay period, prepare a journal entry to correct the current pay period.

Attach the control report to the completed PARs and return to the Controller's Office within 30 days from the distribution date.

Other

Any requests for a salary distribution adjustment must also include a revised, completed and signed PAR. This keeps us in compliance with the Public Health Service Grants Policy Statement, Chapter 7, which states that any cost transfers (including salary adjustments) must be supported by documentation that contains the following:

  • Certification of the correctness of the new charge.
  • Explanation of how the error occurred and how it was discovered.
  • Explanations such as "To correct administrative error" or "To transfer to correct project" or "To correct overdraft" are not adequate justifications.
  • Transfers of costs from one budget period to the next solely to cover cost overruns is not allowable.

Any new employee paid from a Government Grant will be trained on this policy by their administrator or the Grants and Contracts Staff Accountant.

Questions relating to the certification of Personal Activity Reporting should be directed to the Grants and Contracts Staff Accountant located in the Controller's Office.