Excerpts from the OMB Circular A-21 describing federal regulations addressing this issue are included in Appendix 1 for reference.

Reports as described in A and B below must be prepared, signed, and submitted to the District Business and Finance Office.

These records are required to ensure (to the federal government/auditors) that the % of time worked is reconciled with the % of time charged against the federal budget, and that inappropriate salaries are not charged.

  1. To ensure that the % of time worked equals the % of time charged:

    Records of actual time and effort toward federally funded programs must be maintained by the Program Department and by the respective Program Administrator who is responsible for that program.

    These records must be available for internal or external audit within the department and must contain information that identifies both (1) the number of hours dedicated toward the federally funded program, and (2) the total number of hours worked.

    Alternative methods of record-keeping are available to the departments, including:

    • Maintaining semi-monthly timesheets as provided by the SBCTC (Appendix 2); or
    • Maintaining monthly timesheets as provided by SCD (Appendix 3).

    The above time records must be completed, signed, and maintained by the Department Administrator, and copies forwarded to the District Business Office monthly.

  2. To ensure inappropriate salaries are not charged:

    In addition to maintaining the above records, the Program Administrator responsible for the federally funded program must sign and submit verification of employee salaries charged against the federal funds. SCD provides an automated report to accommodate this requirement (Report PS1545A, Appendix 4).

    This report must be signed by the Program Administrator responsible for the federally funded program, and therefore, assumed to be the responsible person with suitable means of verification that the work was performed, and submitted to the District Business Office monthly.

    In the event an employees time is charged against the federal budget in error, the Program Administrator is responsible to report this to the College Business Office, have the correction processed through normal channels, make note of this on the report (PS1545A), then sign and return the report to the District Business Office, accompanied by a copy of the correction.

APPENDIX 1

EXERPT FROM OMB CIRCULAR A-21

8. b. (1) (b)

The apportionment of employees' salaries and wages which are chargeable to more than one sponsored agreement or other cost objective will be accomplished by methods which will (1) be in accordance with Sections A.2 and C, (2) produce an equitable distribution of charges for employee's activities, and (3) distinguish the employees' direct activities from their F&A activities.

8. b. (1) (d)

There is no single best method for documenting the distribution of charges for personal services. Methods for apportioning salaries and wages, however, must meet the criteria specified in subsection b.(2). Examples of acceptable methods are contained in subsection c. Other methods which meet the criteria specified in subsection b.(2) also shall be deemed acceptable, if a mutually satisfactory alternative agreement is reached.

8. b. (2) (a)

The payroll distribution system will (i) be incorporated into the official records of the institution, (ii) reasonably reflect the activity for which the employee is compensated by the institution, and (iii) encompass both sponsored and all other activities on an integrated basis, but may include the use of subsidiary records. (Compensation for incidental work described in Section J.8.a need not be included.)

8. b. (2) (b)

The method must recognize the principle of after-the-fact confirmation or determination so that costs distributed represent actual costs, unless a mutually satisfactory alternative agreement is reached. Direct cost activities and F&A cost activities may be confirmed by responsible persons with suitable means of verification that the work was performed. Confirmation by the employee is not a requirement for either direct or F&A cost activities if other responsible persons make appropriate confirmations.

8. b. (2) (e)

Direct and F&A charges may be made initially to sponsored agreements on the basis of estimates made before services are performed. When such estimates are used, significant changes in the corresponding work activity must be identified and entered into the payroll distribution system. Short-term (such as one or two months) fluctuation between workload categories need not be considered as long as the distribution of salaries and wages is reasonable over the longer term, such as an academic period.

8. b. (2) (f)

The system will provide for independent internal evaluations to ensure the system's effectiveness and compliance with the above standards.

8. c. (1) (e)

At least annually a statement will be signed by the employee, principal investigator, or responsible official(s) using suitable means of verification that the work was performed, stating that salaries and wages charged to sponsored agreements as direct charges, and to residual, F&A cost or other categories are reasonable in relation to work performed.

8. c. (2) (e)

For professorial and professional staff, the reports will be prepared each academic term, but no less frequently than every six months. For other employees, unless alternate arrangements are agreed to, the reports will be prepared no less frequently than monthly and will coincide with one or more pay periods.

8. c. (3) (f)

The reports will be prepared each academic term, but no less frequently than every six months.


Companion Document : Pol668
Adoption Date : 0001/01/01
Revision Date : 0001/01/01