|
Issue Date
|
University/ Gov’t
|
Funding Agency
|
Audit Agency
(source)
|
Audit Finding
|
|
09/28/07
|
University of Maryland Baltimore County
|
NSF
|
Mayer Hoffman McCann (NSF Audit)
|
Four Compliance & Internal Control
Deficiencies in Fiscal Management Practice
·
Audit identified a material weakness that UMBC
personnel did not always follow the cost accounting procedures in place to
ensure that the costs charged to NSF awards were accurate, allowable and
allocable. Revolving account not established timely to separately record
non-reimbursable costs. Monthly review
of expenditures not performed timely. (Change in reporting structure and new business manager on maternity leave)
·
UMBC did not always monitor subaward costs it
charged to NSF awards. Reliance on A-133 audit report does not constitute
adequate fiscal monitoring of its subawardees .Recommended UMBC develop a
comprehensive subawardee fiscal monitoring plan which defines staff
responsibilities.
·
Did not have adequate procedures to monitor
the cost sharing expenditures claimed by its subawardees. UMBC never requested cost sharing data or
cost sharing supporting documentation from its subawardees. Claimed cost share based solely on the cost
sharing budgets. Recommended
UMBC develop and implement written policies and procedures to obtain and
review cost sharing data and related supporting documentation from its
subawardees on a regular basis.
·
Did not have adequate procedures in place to
detect errors in the amount of indirect costs it claimed to NSF. Relied on
accounting system to calculate and record indirect cost to charge its NSF
awards. If direct cost removed from an award the accounting system did not remove
the associated indirect cost.
|
|
09/06/07
|
Brandeis University
|
NIH
|
HHS OIG
|
Administrative & Clerical Expense
The
University misclassified a total of $31,303 to NIH. Specifically, the audit identified the
following charges $13,400 for text and reference books, $14,107 for
subscriptions to trade journals, and $3,797 for other supplies used for two
open house parties to thank current volunteers and recruit new volunteers for
University research projects (deemed public relations costs) that should have
been included in its F&A Costs. Appendix A list specific costs. Books
include course text books in excess of number of students under the grant,
research article reprints, lab manuals and reimbursement of students and
trainees for course textbooks.
|
|
06/26/07
|
Select Grants – Review of Graduate Student
Compensation
|
NIH
|
HHS OIG
|
Review
conducted at the request of two Members of Congress. No finding. University and colleges limited
graduate student compensation charges to the amount paid to a first-year,
post doctoral scientist performing comparable work at the same
institution. Report contained no
recommendations.
Prior
Audit 10/26/94
|
|
05/15/07
|
University of Iowa
Hospitals & Clinics
|
CMS
|
HHS OIG
|
Review
of Vendor Rebate Paid to Hospitals
The
University Medical Center
received a rebate in the form of a credit memo which could only be applied
against the purchase of additional equipment.
The University
Medical Center
used the credit memo to purchase new equipment and reflected the related
annual depreciation expense on its Medicare cost report.
The
CMS OIG identified the rebate through a national statistical sample of
rebates. The audit found that the
provider did not reduce costs reported on it fiscal year Medicare cost report
contrary to Federal regulations and CMS guidelines. The auditors recommended
that the University revise and resubmit its Medicare cost report to reflect
the rebate as a credit reducing its health care costs, Federal regulation 42
CFR 413.98 states that rebates are reductions in the cost of good or services
purchased and are not income. The CMS
Provider Reimbursement Manual (part 1, chapter 8) requires provides to report
all discounts on their Medicare cost reports.
|
|
04/05/07
|
Thomas Jefferson
University
|
HHS
|
HHS OIG
|
University
generally documented cost transfers to federally funded grants in accordance
with Federal requirements.
Since
1996, NIH had designated the University as high risk because of questionable
accounting for grant fund expenditures, specifically cost transfers. In 2000, the University entered into an
institutional integrity agreement with HHS.
The agreement stated that the University adopted new policy and
procedures for cost transfers.
|
|
03/30/07
|
California Institute of Technology
(Caltech)
|
NSF
|
NSF OIG
|
Audit of Payroll Distribution Confirmation
(PDC)
Enhance its PDC system to provide for
accurate reporting of voluntary committed labor effort devoted by faculty
members on Federal Projects. Payroll
distribution system does not track and report actual employee activity/effort
devoted to sponsored projects. Rather, the system is only required to
validate salaries and wages directly charged to Federal grants. Salary costs associated
with such unreported faculty effort does not properly get included in
Caltech’s organized research base, thereby resulting in greater indirect
costs paid by the Federal Government.
Caltech
has not established clear guidance and procedures to ensure that PIs properly
identify and track effort voluntarily pledged as cost sharing in its Federal grant
proposals. (In accordance with OMB’s
January 2001 Clarification Memorandum.)
Caltech
should establish a methodology for reasonably estimating and calculating an
amount of “committed cost-shared” PI effort to be reported in the PDC system
for sponsored projects with no PI salary reimbursements and ensure such
calculated amounts are supported by adequate documentation and included in
the organized research base for computing the Federal indirect cost rate
Effort Not Submitted within Policy Time
Frame
Caltech
needs to improve the timeliness of PDC report distribution and certification.
Of the 63 PDC reports reviewed for the 32 sampled employees, all of
the
reports were certified late beyond the 150-day timeframe established by
Caltech policy.
Incomplete
Committed PI Effort Reported on NSF Grant Proposals
Caltech
did not always properly report effort that the PI had actually committed to
research projects and activities in the Current and Pending Support
information required to be submitted with NSF grant proposals.
Establish
procedures and guidance to ensure that PI committed person-months is
accurately reported for all projects and activities, including the currently
proposed
grant, in the Current and Pending Support information submitted in NSF grant
proposals as required by Chapter II, Paragraph C.2.h. of the
Foundation’s
Grant Proposal Guide.
Formal
Policy and Procedures Needed for Internal Evaluation of PDC System
Establish
a formal requirement for an independent evaluation of the PDC system to
ensure its effectiveness and full compliance with OMB, NSF, and Caltech
standards. Such a requirement should include procedures to ensure a
systematic review of the payroll distribution system is performed to identify
reasons for any deficiencies and to make appropriate recommendations,
identify the specific office responsible for performing the evaluation, and
how often such an evaluation should be conducted.
Cost
Transferred to NSF Grant From An Overspent Federal Award
We
found a lack of monthly PI monitoring of Federal grant expenditures, an
excessive number of cost transfers involving 8 of the 12 months of one individual’s
annual salary, and a cost overrun situation with the Air Force grant.
Establish procedures that require that transfers of costs from overspent
Federal grants to other sponsored projects require formal written
justification and
certification
by the PI, the Division Chair, and the Associate Director of Project Accounting
that the transfer of cost is proper and benefits the receiving award.
|
|
03/12/07
|
Georgia State
University Research
Foundation
Cooperative Agreement
|
NSF
|
NSF OIG (Conrad and Associates LLP)
|
Cooperative agreement which brings
together 8 academic “partner” institutions from Atlanta Universities transferred
from Emory University
Inadequate Subawardee Monitoring-Audit
identified a significant weakness in GSU’s monitoring of subawardee costs and
cost sharing. Questioned costs include
costs for which there was documentation that the recorded costs were expended
in violation of the law, regulations or specific conditions of the
award. Costs without adequate support
by the awardee and costs that require interpretation of allowability by the
NSF.
Recommended
that GSU establish a risk-based monitoring program to ensure that costs were
compliant.
Inadequate Documentation
Payroll Expenses - Center charged for
work done on another grant, GSU did not take adequate care in maintaining
required documentation, and did not always follow its policies and procedures.
Transfers
made without explanation or source documentation.
Could
not locate personal action forms.
Non-Payroll – Unable to provide
documentation to substantiate that international travel expense related to this
award or the travel was properly approved. Unable to provide documentation
that purchases were properly authorized, supplies were received or that
charges were incurred on behalf of the grant. Unable to provide the contract for
consulting services for an invoice.
Inadequate Documentation of Non-Payroll
Expense and Cost Sharing -For cost sharing contributions, the Center
relied on the subawardeee’s annual certifications of the amounts claimed,
without requesting or maintaining additional documentation to prove the
accuracy or validity of the claimed amounts.
Preaward Charges in Advance of 90 day
Limitation
|
|
02/12/07
|
New Mexico Title IV-E
Contracted University
Training Costs (A-06-06-0004)
|
ACF (Administration for Children and Families)
|
HHS OIG
|
Training Contacts with New Mexico
Highland University,
Western New
Mexico University,
and New Mexico State University
The state agency contracted with State Universities to
fulfill a portion of its training needs.
The contracts required the universities to provide the State match and
provided for reimbursing the universities for their expenditures up to the
yearly budgeted amounts which included direct training costs, administrative
costs, and funding reimbursement rates. The contracts allowed the indirect
cost rate to be applied to total direct costs. During audits and site visits,
the State agency provided Administration
for Children and Families (ACF) with copies of university contracts and
approved budgets in which ACF approved the contractual and payment process to
the universities at the enhanced 75-percent training rate.
In compliance with contract language, Highlands University applied its indirect cost to a cost
base, which included equipment and stipends (determined incorrect by the
OIG). . The state argued that the universities had complied with the
terms of their subcontracts, which stated that the indirect cost rate could
be applied to total direct costs. The OIG agreed that the state could
reimburse the university using the terms it negotiates but the costs were not
reimbursable to the state under IV-E program.
Reimbursement to
the Universities for Unallowable Costs. Reimbursed costs were not supported by ledgers or invoices, expressly
unallowable (such as donations and entertainment), or not reasonable and
necessary for operating the program (such as candles, corsages, boutonnieres, food, and T-shirts), as well as the
indirect costs associated with these unallowable amounts.
|
|
11/15/06
|
Not specified in Report to Congress
|
NSF
|
NSF OIG September 06 Report
to Congress
|
An
accounting assistant at a grantee institution responsible for processing
payments for federal and non-federal awards was debarred from NSF after
conviction of embezzling non-federal funds.
A Utah university failed
to provide guidance to the PI or exercise proper oversight of two NSF awards,
with the result that participant support funds were not used for the stated
purpose. University reimbursed $19,000.
An
OIG investigation involved a university employee who was subsequently
convicted of embezzling more than $487,000, including $415,000 in NSF funds.
In addition investigators discovered that the university certified to
inaccurate cost-sharing contributions each year of the award, and could not
support a number of expenses charged to the NSF grant.
|
|
09/28/06
|
Boston University
|
NIH
|
HHS OIG
|
Cost Transfer Policy not Followed.
Questioned $11,234 on subaward from Harvard University.
Payroll cost transfer was unallowable in accordance with the University’s
procedures, which state that salary adjustments that increase the level of
effort beyond the level certified on the time and effort report will not be
accepted.
Late submission of final invoice to prime.
|
|
09/26/06
|
University of Hawaii
|
NSF
|
NSF OIG
(M.D. Oppenheim & Company)
|
Cooperative
Agreement five-year funding of
$9,852,441
with a required cost-sharing match of $3,228,256. The original intent of NSF was to fund this
marine biotechnology research for a period of ten years however, based upon
an NSF site review the program was terminated after the initial five-year
funding.
Unrealistic Percentages for Allocating
Labor Costs Related to Cost Sharing Contributions
$1,741,879
of inadequately supported UH labor cost sharing. The grantee’s allocated
labor costs for cost-sharing contributions were based on estimated and not
actual costs. This practice is contrary to OMB Circular A-21, Section J, item
8 (c) (1)
Inadequate Supporting Documentation for
Subcontract Costs questioned
$305,706 of cost sharing and $265,449 of direct NSF funded
costs
claimed by the subcontractor, UCAL, Berkeley, because of inadequate supporting
documentation.
|
|
09/26/06
|
New Mexico Highlands
University
|
NSF
|
NSF OIG
(M.D. Oppenheim & Company)
|
5
year Cooperative agreement of $9,500,000
Questioned
Costs $ 165,472
Lack of System to Identify, Account for,
Monitor and Report Cost Sharing Questioned $1,959,263 of cost share due
to a lack of adequate supporting documentation. NMHU could not readily identify in its
accounting records the cost sharing amounts it had claimed to NSF.
Lack of Adequate Fiscal Monitoring of
Subawardee Costs. Questioned of $81,787 due to lack of
supporting documentation.
Inaccurate and Unallowable Expenditure
Reporting
Costs
reported to NSF did not agree with official accounting records. Auditors
questioned costs due to lack of documentation; purchase of materials and
supplies at the very end of the grant period with no explained benefit to NSF
program; salaries and wages charged to the award for a professor who did not
work on the NSF program; and scholarship costs paid for students who were not
eligible to participate in the program.
Lack of Conflict of Interest Disclosures
|
|
09/07/06
|
Tennessee State
University
|
NSF
|
DOJ (Press Release)
|
A former professor
at Tennessee State University indicted on one count of wire fraud and one
count of mail fraud as a result of misrepresentations allegedly made in
connection with administration of a grant from NSF. The professor used employees funded by NSF
grant dollars in furtherance of private consulting performed on behalf of a
company organized by a subordinate.
|
|
|
05/01/07 Barbara Nye, Tennessee
State PI Enters Guilty Plea
|
NSF
|
DOJ
|
Former Tennessee
State Professor enters guilty Plea. Nye
was the director of the Center of Excellence at Tennessee State
University (“TSU”). As
part of her work at TSU, she was the Principal Investigator of a multimillion
dollar grant from NSF. The TSU grant included funds to hire employees known
as “Teachers In Residence” (“TIRs”), who were expected to spend all of their
time working on the TSU grant.
At
the same time, Nye was the lead evaluator for a different NSF grant at the
University of Alabama-Huntsville (“UAH”).
This evaluation project was separate from her work at TSU and she was
paid consulting fees from UAH for her work.
Nye sent two employees of the TSU grant to UAH to work on her
evaluation of the UAH grant and submitted the travel claims to TSU, knowing
that it was for travel that was not related to the NSF grant and that it
would be paid with NSF funds.
Nye
admitted that her false statements and other conduct caused a loss to the
government of more than $10,000. Moreover, Nye further admitted that she
abused positions of trust, specifically her job as director of the Center of Excellence and her position as
Principal Investigator on the TSU LSC grant, in committing the offense to
which she pled guilty.
09/07/06
Audit of Tennessee
State Resulted in
Indictment
|
|
06/30/06
|
15 Universities
|
CDC
|
HHS OIG
|
Audit objective was
to determine if the universities had established control over select agents
in compliance with federal regulations.
Eight universities had weaknesses in their inventory
and/or access records. Records did not
always identify individuals who had entered select agent areas or the dates
and times of access.
Six universities had weaknesses in access controls
including procedures for issuing electronic access keys to select agent
areas.
Six universities had weaknesses in their security
plans. In four cases, the universities
had not used a systematic approach to identify threats or had not identified
all relevant threats.
Three universities had not provided training to all
individuals with access to select agents or had not documented the means used
to verify that individuals understood the training.
|
|
06/16/06
|
University of Chicago
|
NIH
|
HHS OIG
|
Cost Transfer
Policies not always Followed The University had extensive cost
transfer policies and procedures, which closely follow the NIH Grants Policy
Statement and OMB Circular No. A-21 requirements but staff did not always
follow those procedures and cost transfers were not always documented and
authorized as required.
Background section provides a good summary of Federal Cost
Transfer Requirements along with the type of transfers which would raise
serious questions.
|
|
06/08/06
|
University of Pennsylvania
|
NSF
|
NSF OIG
|
NSF
Audit of Payroll Distribution
Weaknesses
in the effort reporting system Specifically, based on our statistical sampling results, we
are 95 percent confident UPENN could not
Demonstrate
that at least $9.2 million or 37 percent of the $24.9 million of labor costs
charged to NSF in fiscal years 2002 through 2004, actually benefited NSF
awards as opposed to other Federal or university activities. Further, the
systemic nature of this
control
weakness raises concerns about the reasonableness and allow ability of the
labor effort charges on UPENN’s other $525 million of Federal awards.
The audit disclosed two major systemic
internal control 1) UPENN’s business managers were certifying labor
effort reports, though they were not in a position to know whether work was
performed, and 2) effort reports
were not certified in a timely manner as specified by
UPENN policy.
UPENN
did not have specific procedures to help business managers understand the
types of documents that were necessary to support the effort reports and Department
Chairs were not held
accountable
for ensuring effort reports were completed within the 45-day turnaround period.
UPENN also did not conduct an independent evaluation of its payroll
distribution system. The auditors disagree with UPENN’s assessment that its
annual A-133 audits and internal audits of individual sponsored projects meet
the Federal grant requirement because both types of audits did not provide
for a systemic review of the payroll
distribution
system.
|
05/24/06
|
University of Arizona
|
NSF
|
NSF OIG (Conrad
& Associates, LLP)
|
Cooperative
agreement of $16.992M
Lack of controls over Subawardee Cost
sharing expenditures. University certifications were the only source
documentation maintained by the University to support the subawardee amounts
claimed as cost share.
Lack of controls over subawardee costs
funded by NSF. University relied on clean A-133 report and certified
invoices signed by a responsible fiscal person at the subawardee to support
costs claimed by subawardees.
Inadequate retention of electronic
payment approvals. Electronic
signatures of non-payroll items retained for 90 days.
Inadequate review of consulting expenses.
Business manager not required to verify that actual consulting services
were rendered.
Inadequate documentation of payroll
expenses.
Could
not locate signed time sheets for 18 out of 1132 transactions.
Overcharging of Publication Costs
Unclear
from documentation how university calculated 2 % administrative fee for print
shop service unit. (note b-7 of audit)
|
05/04/06
|
North Shore
University
|
Medicare
|
HHS OIG
|
The hospital did not fully comply with
Medicare requirements for reporting wage data in its FY 2003 Medicare
cost report.
*Hospital
overstated its wage data by $3,119,582 and 1,567 hours. The hospital used
GAAP to include postretirement benefit and pension costs on Schedule S-3,
part II, of the FY 2003 Medicare cost report but did not liquidate the entire
amounts associated with these costs within 1 year of the FY 2003 cost reporting
period.
OIG: While we agree that the hospital computed
these costs in accordance with GAAP, the costs were not reported in
accordance with Medicare requirements.
|
|
04/10/06
|
University of Maryland
|
Medicare
|
HHS OIG
|
Allocation of Costs, Insufficient
Documentation The Medical
Center did not always
comply with Medicare laws, regulations, and guidelines for reporting its
costs, including organ acquisition costs, to the Commission.
Specifically, the Medical
Center did not have
systems that could allocate organ acquisition costs separately from non-organ
acquisition costs and other hospital activities. Insufficient
documentation and therefore unallowable.
|
|
04/06/06
|
Eastern Kentucky University
|
Title IV-E
|
HHS OIG
|
EKU did not maintain
accounting records in such a manner that the cost of individual training
projects could be determined.
Sixty-three percent of the costs of training charged to
Title IV-E in Kentucky
were paid under contract with Eastern Kentucky University (EKU) through the
University Training Consortium. Of the $28.5 million in training costs, the
State agency claimed $18.1 million ($13.5 million Federal share) through its
contract with EKU. Issues arose on $7.2 million ($5.4 million Federal share)
related to the balance of 566 courses.
·
Two hundred and forty-five courses related to
general subject matter were claimed at the enhanced 75-percent rate instead
of the required 50-percent rate.
·
Twenty
courses did not meet the definition of allowable activities.
·
Three hundred and one courses may have been
inappropriately allocated to Title IV-E.
EKU did not maintain accounting records in such a manner
that the cost of individual training projects could be determined. Instead,
EKU accumulated the costs in the accounting records by funding source. While the
detailed supporting records identified the funding source, in most cases,
they could not be traced to a particular course.
|
|
03/31/06
|
Howard University
|
NSF
|
NSF OIG
|
Lack of comprehensive policies,
procedures, techniques, and mechanisms to effectively manage, account for,
and monitor NSF grant funds.
- Lack of written policies and procedures. While Howard had
issued some policies and procedures pertaining to some key aspects of
Federal grants management over the years, an internal control process
was not established for monitoring and/or evaluating administrative
actions to ensure that established procedures were being implemented and
effectively achieving sound Federal grants management objectives.
- Unable to verify whether
the $12.3 million of cost sharing
benefited the intended NSF projects.
- The University did not
separately track, and therefore, could not support $6.9 million of
matching funds.
- Lack of adequate
documentation to support $5.4 million of claimed cost sharing provided
by seven subawardee organizations.
- Lack of adequate
documentation to support the faculty salary computations.
- Insufficient documentation in accounting records.
|
|
03/31/06
|
Steven Raper, M.D. University of Pennsylvania
|
NIH &
FDA’s Office of Criminal Investigations (OCI)
|
HHS OIG
|
Civil Complaint Filed Against University of Pennsylvania
Investigation based on allegation that physicians withheld
information and provided false information to FDA and the University of Pennsylvania’s
Investigational Review Board (IRB) regarding the gene therapy trial.
When patients experienced significant liver toxicities from
the transfusion, the physicians amended the study protocol to remove the
stopping rules which required that the trial be halted if patients
experienced such toxicity. An 18-year old patient in the trial died.
The investigation pieced together the chain of
non-communications and miscommunications that effectively kept the
University’s IRB, FDA and the National Institutes of Health (NIH) all unaware
that the patients were being exposed to greater and greater risk. Three
documents were never sent to FDA because the Quality Assurance Director
failed to submit them and two annual reports hand-carried to the local IRB
contained understated toxicities.
The father of the deceased, who initially stood by IHGT and
the physicians after his son died, filed suit against the University of Pennsylvania
and the three physicians.
The complaint was immediately settled. In the settlement,
the University
of Pennsylvania and
CNMC each agreed to pay grant restitution and fines. Both institutions agreed
to increase research subject protection and spend millions of dollars
increasing the size of their IRBs, revamping their review procedures,
initiating and mandating training for clinical investigators and upgrading
their adverse event reporting.
|
|
03/23/06
|
University of Massachusetts
|
NIH
|
HHS OIG
|
Administrative Costs Unallowable
The
State agency entered into an administrative services contract with the
University of Massachusetts Medical School
(the University) under which the University agreed to provide support
services to the Medicaid
State agency.
The
State agency claimed administrative
costs that were unallowable because they did not adhere to Federal
regulations. Specifically, the State agency claimed reimbursement for:
• unsupported contingency fee payments,
• excessive payments to a subcontractor,
and
• employee salaries that had already been
reimbursed through indirect cost rates.
·
University did not prepare timesheets or
obtain supervisor certifications for most employees whose salaries were
claimed for Federal reimbursement.
|
|
03/03/06
|
Columbia University
|
NIH
|
HHS OIG
|
Cost Sharing – No Finding University had procedures in place to
document.
This final report states that Columbia University
had procedures in place to document mandatory cost sharing; removed salary
above the cap when submitting grant application and claims for Federal
reimbursement for NIH projects and properly included salary above the cap in
the calculation of the Facilities and Administrative cost rate. The
report contained no recommendations.
|
|
02/27/06
|
Roger
Williams Hospital
Subawardee University
of Massachusetts
Medical School
|
NIH
|
HHS OIG
|
Subawardee
Unallowable Costs
Audit of Roger
Williams Hospital
a subawardee of the University of Massachusetts Medical School
**Recommended that UMMS reimburse NIH for unallowable
costs of subawardee
- Unallowable cost transfers and
related fringe and indirect costs
- Unsupported animal care charges
and indirect
|
|
02/03/06
|
Yale
University Subawardee
University of Massachusetts Medical
School
|