MODIFIED FINANCIAL REPORTING REQUIREMENTS 

NIH GUIDE, Volume 25, Number 22, July 5, 1996

 

P.T. 34



Keywords:

  Grants Administration/Policy+ 

 

National Institutes of Health

 

INTRODUCTION

 

In FY 1995, the National Institutes of Health (NIH) implemented the

Streamlined Non-Competing Award Process (SNAP), which simplified the

requirements of the non-competing application process (Phase I).  In

Phase II of SNAP, which was begun in FY 96, the Notice of Grant Award

was changed to reflect only direct and indirect costs, and indirect

costs are now included in the future year recommended levels.

 

In an attempt to further streamline the non-competing process, NIH is

implementing Phase III of SNAP by modifying the financial reporting

requirements.  Effective for grants (competing and non-competing)

with July 1, 1995 start dates, a Financial Status Report (FSR) will

only be required at the end of the competitive segment rather than

annually.  If the award which was effective July 1, 1995 was the

final award for the competitive segment, an FSR will be required.

 

SNAP applies to all mechanisms routinely covered under expanded

authorities (see NIH Guide for Grants and Contracts, Vol. 23, No. 45,

December 23, 1994), except Program Project Grants (P01s) and

Outstanding Investigator Grants (R35s).  Awards may be specifically

included or excluded from SNAP by a term and condition on the Notice

of Grant Award.  Questions concerning the status of a specific award

should be addressed to the Grants Management Officer of the awarding

component.

 

Throughout its efforts to simplify and streamline the policy

requirements for Federal grants, NIH has emphasized the importance of

continued effective and efficient monitoring of Federal grant funds.

Federal grant managers and grantee staff are required to assure that

Federal funds are expended for the purpose for which the grant was

awarded and in compliance with Federal regulations.  Monitoring the

financial aspects of grants is a requirement for both grantee and NIH

staff and is of paramount importance.  This requirement does not

diminish because of the modified reporting requirements under this

announcement.

 

IMPLEMENTATION

 

For all grant awards under SNAP with July 1, 1995 start dates, annual

FSRs will no longer be required.  FSRs will be required 90 days after

the end of the competitive segment. This FSR should reflect

cumulative support provided for the entire competitive segment.  The

FSR must be submitted whether or not the grant receives funding for a

competitive renewal. It must also be submitted if a grant terminates

early or transfers to a new institution.

 

NIH staff will use the Federal Cash Transaction Report (FCTR) to

continue to monitor the financial aspects of grants.  The FCTR

provides a quarterly breakdown of cash transactions on a grant record

basis.  These transactions will be monitored to determine if the

pattern of cash expenditures indicates possible problems.  For

example, if it appears that funds are being drawn too quickly, this

could be an indication of an inappropriate acceleration of

expenditures; or if funds are not being drawn at all, this could

indicate poor progress, delayed hiring, or a significant unobligated

balance.  If the pattern of cash expenditures appears inappropriate,

grants management staff will request additional information (e.g.,

annual accounting records) from the grantee to determine if there are

issues related to the grant that need closer monitoring.

 

It is incumbent upon grantee organizations to have in place

accounting and internal control systems which provide for appropriate

monitoring of grant accounts to assure that areas of concern are

addressed and communicated to the awarding component's Chief Grants

Management Officer.  Internal control systems should assure that

obligations and expenditures are reasonable, allocable and allowable

and provide for identification of large unanticipated unobligated

balances, accelerated expenditures, inappropriate cost transfers, and

other inappropriate expenditure and obligation of funds.  These are

all areas that could be indicators of problems with the progress of

the project and/or the maintenance of grantee stewardship

responsibilities for the funds provided with the grant.  It is also

incumbent upon the grantee organization to assure that day-to-day

financial monitoring is being accomplished at all levels of the

organization.  Accordingly, appropriate training, support, and

internal controls must be available to departmental administrators

and other grantee staff who are in a position to assist investigators

in the day-to-day management of Federal funds.

 

WHO WILL BENEFIT

 

This effort to streamline the financial reporting requirements for

most grant mechanisms should benefit NIH and grantee staff.

Resources currently focused on compliance with timely financial

reports on an annual basis can be reallocated to provide assistance

to investigators and administrators and oversight to assure that

grants are operated in accordance with Federal regulations.

 

INQUIRIES

 

Questions regarding this policy may be directed to the Grants

Management Specialist identified on the Notice of Grant Award.

 

.

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