This guide provides an overview of effort, effort reporting and certification, including an explanation of why such processes are necessary and the minimum requirements for these processes at UTA.
- Effort Defined
- Effort Reporting
- The Effort Lifecycle
- Who Certifies Effort?
- How do you Certify Effort
- Federal requirements regarding effort reporting
- Effort Vignettes
Effort is the percentage of time spent towards particular Work-Related Activities such as sponsored projects, instruction, proposal preparation, or other administrative duties. Effort is not based on a 40-hour work week, but it is calculated as a percentage based on the total time spent on work-related duties for specific period of time.
For example, if a person averages 60 hours per week during a reporting period and spends an average of 15 hours on a Sponsored Project, that person has spent 25% effort on the sponsored project and 75% effort on other activities.
Effort is only based on the Work-Related Activities under which the institution has guaranteed compensation (salary) under contract. This amount is otherwise known as “Institutional Base Salary ”. Excluded from Work-Related Activities are fringe benefit payments, reimbursed expenses, temporary or supplemental compensation for incidental work, and any income earned outside of the duties to the institution.
For example: if a person averaged 60 hours per week towards institutional activities and an additional 8 hours towards outside consulting work, effort is only distributed based on 100% of the activities devoted towards the 60 hours spent on institutional activities.
Effort Reporting is a mechanism used to provide a sponsoring agency with a reasonable assurance that salaries charged to a sponsored project are appropriate and reflect a reasonable estimation of the actual time spent towards the project (relative to the individual’s total activities performed for the university).
Salary appointments are approved before or as services are actually performed. UT Arlington’s effort reporting system, ECRT, provides an “after-the-fact” confirmation that the salaries paid to individuals reasonably reflects the actual amount of effort expended on a sponsored project. Effort reporting is confirmation that funds charged to the federal government are allocated appropriately to the activities they benefit (separate sponsored projects vs. university activities in terms of teaching, research, service and administrative duties).
- For determining “reasonableness”, OMB Circular A-21 states “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… The payroll distribution system will … (ii) reasonably reflect the activity for which the employee is compensated by the institution…”
For example, A faculty member is appointed 20% to a sponsored project for 3 summer months and 0% time during the academic year. At the time of Effort Certification (September), the faculty member would review their effort for the prior 6 month period (March to August) as being 10% effort based on the appointment data averaged over the entire certification period (6 months). In this case, the average effort equates to 10% (60% total effort over 6 months). If the certifier agrees 10% is reasonably accurate in relation to their 100% effort (time spent towards instruction/service/administrative duties/other projects) for this period of time, they can certify their effort. If they certify their effort was actually 5% during this effort reporting period a change to the appointment (PAF/salary charged) will need to be processed in order to correct the salary charged to the sponsored project.
Overall, Effort Reporting is a mechanism to confirm that the salary charged to sponsors was reasonably allocated for the actual time devoted.
The Effort Lifecyle
The following is an illustration for how effort is estimated, committed, charged, and certified:
Proposal budgets should in most instances include salary support for the time that PIs (and his/her support staff) will spend on the project in order to complete the work. Effort should be proposed based on good faith estimates, and calculated based on an individuals institutional base salary.
- Committed Effort: Should a proposal be awarded, the University accepts the award on the PI's behalf. Award negotiations may take place for a variety of reasons which may or may not affect the Committed Effort of the PI or other individuals on the proposal. This commitment establishes the expected effort (time devoted and allocated) to the sponsored project. It should be noted that Committed Effort is based on the project or budget period of the specific project. Faculty effort may and is expected to fluctuate throughout an academic year – especially when comparing academic and summer time periods.
- Charged Salary: Department Admins/Effort Coordinators should create a PAF to charge sponsors this expected allocation of effort onto the sponsored project.
- For example: If faculty member committed an annual 20% time during a project period starting in January, the department admin/Effort Coordinator could revise the PAF of the faculty member to meet this expected commitment of effort
- Salary review and monitoring: Individuals charging salary to sponsored programs should coordinate with their department admins/effort coordinators appointments charged to sponsored projects as effort or expected effort distribution may fluctuate due to additional tasks or shifting of duties. Appointments should be periodically reviewed and monitoring to ensure their accuracy relative to an individual’s total effort distribution.
- For example: If a faculty member was appointed 20% time on a sponsored project and then is awarded another sponsored project with a commitment of 30% time, the salary may need to be reviewed and adjusted on these sponsored projects to ensure they are still being fulfilled in relation to the faculty member’s total effort. The same would be true if additional instructional or administrative duties are added to a faculty member. Of course the individual could just simply work more time to fulfill these work-related-duties and the effort distribution could stay relatively the same.
- Effort Certification: PIs will certify effort on their sponsored programs every six months for the certification periods Sep. to Feb and March to Aug. In this process, the certifier will review their effort card and make any necessary changes to the effort charged on sponsored programs. If changes are noted, this may necessitate a cost transfer for the appointment to the grant account.
PI’s of sponsored projects, Faculty members who have either been paid or committed contributed effort (cost share) to a sponsored project or other individuals as assigned are required to certify their own individual effort every 6 months in the ECRT system.
PI’s of sponsored projects will also certify the effort of support personnel on their projects that have either been paid or committed to contribute effort (cost share). If a PI does not have first hand knowledge of their support personnel’s total effort, they can request to have individual support personnel to certify their own effort. This request is made to the Office of Grant and Contract Services at 817-272-2105 or email firstname.lastname@example.org.
How is Effort Certified?
Certifiers must login to ECRT with their UTA network username and password. Once logged in, the self-certifier will have access to their effort card and if applicable, access to review and certify their supporting personnel. ECRT is available at http://www.uta.edu/ra/GCS/ecrt/
A guide (http://www.uta.edu/ra/GCS/ecrt/resources.php) for self certifiers and video training (http://www.uta.edu/ra/GCS/ecrt/training.php) are also available for download.
The Office of Management and Budget's (OMB) Circular A-21 "Cost Principles for Educational Institutions" is the federal government's cost principles for colleges and universities. It defines what costs are allowable and allocable to federal grants and other "assistance" agreements.
OMB Circular A-21 (Section J.8) sets forth criteria for acceptable methods of charging salaries and wages to federally sponsored projects. A-21 requires a payroll distribution system that directly charges salaries to appropriate projects.
In addition, Circular A-21 requires that institutions develop a mechanism to determine or confirm how individuals actually expend effort during a specified time period. These effort reports must be performed on a regular schedule and must be certified by individuals who have first-hand knowledge of 100 percent of the employee's compensated activities. In most cases, that would be the employee or the employee's direct supervisor.
An effort reporting system must provide records on how individuals participating in federally funded sponsored agreements actually spend their time. Because the federal government mandates effort reporting, it is incumbent upon institutions that receive federal funding to maintain accurate and auditable systems and records.
Documentation on how individuals spend time on federally sponsored projects is subject to federal audit and can be cause for institutional or individual disallowances.
Institutional disallowances can result if:
- The effort report was certified by an individual other than the employee or someone who has "first-hand" knowledge of 100 percent of the employee's time;
- The effort report does not encompass all of the activities performed by the employee under the terms of their employment;
- The levels of effort reported do not appear reasonable, given the responsibilities of the individual.
Individual disallowances can result if:
- The effort report certified by the individual is found to be falsified;
- The levels of effort reported do not appear reasonable.
As evidenced above, federal audit disallowances can result in serious financial penalties for institutions. In addition, criminal charges may be brought against an individual certifying to falsified effort.
Dr. Sharp spends the majority of her time on research with some time spent teaching. She teaches one course in her department to PhD students. She also has three grants which take up 75% of her time and her effort is split evenly among the grants (25% on each). The remaining 25% of her effort covers the time spent teaching her course.
During the Spring semester, Dr. Sharp will be working four nights a week teaching departmental courses to undergraduate students. She will continue to spend the same amount of time on her other obligations (three grants and one PhD course). Does her effort report need to change?
ANSWER: Yes. Dr. Sharp's effort on non-sponsored activities increased so her effort on her sponsored research activities would be reduced proportionately.
Dr. Bright has several sponsored research agreements with private companies with committed effort for herself and her research staff. Dr. Bright has no federal grants or contracts currently. Does Dr. Bright need to certify her effort?
ANSWER: Yes. Anytime a faculty member or staff member has committed effort to a sponsored project, either paid or cost-shared by the University, an effort report must be certified.
Dr. Quick is a faculty member with a 9-month appointment. She often spends 50 to 60 hours per week on her academic duties. Her academic duties include working with graduate students, teaching two undergraduate level courses, serving on a departmental and University committee, and serving as the PI on three sponsored projects. She also does some consulting work for local start-up companies in her field of expertise. Which parts of Dr. Quick's effort are not considered to be part of her 100% UT Arlington effort?
ANSWER: Outside consulting work. Outside consulting work is not considered part of a faculty members 100% UT Arlington effort.
Dr. Bright is budgeted to devote 75% of her Total Effort to an NIH project and is paid from the grant at that rate. She puts in 30 hours a week on the project, but also spends 20 hours a week on her teaching and administrative responsibilities. What level of effort should Dr. Bright be certifying for her NIH project?
ANSWER: Dr. Bright's Effort is 60% (30/50). Effort percentages are not calculated on the basis of a 40-hour work week or any other "standard" work week â€“ Effort is calculated and expressed as a percentage of Total Effort (100%).
Dr. Clever has three NIH grants from which he derives 100% of his salary. In addition, he is the PI on two sponsored research agreements at 0% effort. Dr. Clever is also the Chair of a Department. Is there an audit risk involved with charging 100% of Dr. Clever's salary to Federal grants?
ANSWER: Yes. Typically there would be some administrative responsibilities as the Chair of a Department so it would be an audit risk to have 100% of Dr. Clever's salary charged to federal grants. Some Effort should be assigned to Dr. Clever's non-NIH grant activities.
Over the course of a week, Dr. Able usually works on UT Arlington business, 34 hours during the day (M-F) and 10 hours on nights and weekends. He spends about 6 hours each Monday consulting for an outside entity, and receives pay directly from that outside entity for this service. Dr. Able averages 11 hours per week on NIH grant activities. What percentage of Dr. Able's effort is attributable to his NIH grant?
ANSWER: 25%. Dr. Able's Total Effort equals 44 hours. His NIH grant(s) may be charged 11/44, or 25%, of his IBS for the period.
Dr. Brainy serves as a journal editor, for which she receives no compensation from the journal and spends on average 8 hours per week. No UT Arlington funds are used to support the journal activities and none of Dr. Brainy's journal-related expenses are reimbursed by UT Arlington, although her administrative assistant is compensated by funds made available to UT Arlington by the journal. Can Dr. Brainy's journal editor activities be considered as outside consulting?
ANSWER: Dr. Brainy may consider the time she spends with the journal as outside consulting, and does not have to include this effort in determining the overall hours that form the denominator (Total Effort) of her Actual Effort calculation.
Dr. Prompt attends three different scientific meetings which cause Dr. Prompt to be away for half the month. Is the time spent at those meetings allocable to his grants?
ANSWER: Yes - if the primary purpose of the scientific meetings was the dissemination of technical information reasonably related to his grants.
Dr. Swift is absent for one month for vacation and illness. During the remainder of the year he expends 80% Actual Effort on his grant activities. His salary is funded 80% from NIH grants. What percentage of effort can Dr. Swift certify to his NIH grants?
ANSWER: He can certify 80% Actual Effort on his Time and Effort report, even though he was absent for one month of the certified annual period.
• Note: There may be a requirement to notify NIH if absences are more prolonged.
Dr. Abrupt is involved in an NIH sponsored project to which she pledged 3% effort but did not request corresponding salary support. On her Time and Effort report, no pre-printed entries would normally appear for the NIH award, because the pre-printed entries on the Time and Effort report form reflect only salary actually charged to sponsored projects (unless Cost Sharing has been specifically entered). Should Dr. Abrupt certify the effort as is?
ANSWER: If Dr. Abrupt had no Actual Effort on the project, she should certify the report as is. However, if she expended any effort on the grant, the report must be adjusted manually by identifying the project and noting the percentage of Actual Effort expended.
• Note: Being listed as a potential mentor on training grants does not require effort or Cost Sharing.
Dr. Gifted spends 3 hours a week teaching a course for graduate school credit to graduate students. She also spends an average of 4 hours a week mentoring each of the three graduate students assigned to her research, and 2 hours a week in a lab meeting discussing research issues relevant to her NIH funded project. Which of these activities can be counted as effort toward her NIH project?
ANSWER: The lab meeting and mentoring time can be considered as part of her effort devoted to the grant, but the course should be considered as instruction and attributed to her UT Arlington-supported effort.