Institutions that receive federal funding are required to maintain a system of internal controls that provide reasonable assurance that salary and wage charges to sponsored projects accurately reflect the work performed. The University of Alabama (UA) employs an after-the-fact effort reporting system as the principal means for certifying that salaries charged to sponsored projects are reasonable and consistent with the portion of total effort committed to sponsored projects.
The effort reporting process allows UA to document that actual effort directly benefiting sponsored projects is certified and appropriately allocated when considered in the context of all institutional activities.
Faculty and staff whose salaries are charged, in whole or in part, must have this time certified via the project effort reporting process to confirm that payroll charges reasonably reflect the actual work performed during the certification period. This certification provides the documentation necessary to support salary charges to federal awards and demonstrates compliance with the personnel expense requirements of 2 CFR Part 200. Accurate and timely effort certification is an important component of responsible stewardship of sponsored funds and helps ensure institutional compliance with federal regulations.
Federal Requirements
The Office of Management and Budget (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (2 CFR Part 200) requires recipients of federal funding to maintain an effective system of internal controls that ensures salary and wage charges to sponsored projects are accurate, reasonable, and properly allocated. Because salaries and wages often represent the largest direct cost charged to federal awards, institutions must maintain documentation that reasonably reflects the work performed by employees whose compensation is charged, in whole or in part, to sponsored projects.
Effort reporting provides assurance that salary costs charged to sponsored awards are supported by the work performed and comply with federal cost principles. An effective effort reporting process is a key component of the University’s internal control framework and helps promote compliance, responsible stewardship of sponsored funds, and reduced audit risk.
Internal Controls
Contract & Grant Accounting manages the Project Effort Reporting System (PER) and associated certification process to ensure that faculty, student, and staff salaries charged to externally sponsored grants and contracts are reviewed and certified.
Individuals certifying effort reports must have suitable means of verification that the effort certified reasonably reflects the work performed during the certification period.
UA Effort Reporting Procedures set forth internal controls designed to ensure compliance with applicable federal regulations and University requirements. The actual effort devoted to each sponsored project during the certification period serves as the basis for determining whether salary charges reasonably reflect the work performed.
All employees involved in certifying effort must be aware of these requirements and the importance of compliance. As a reminder, sponsored effort committed during the academic year cannot be deferred or “charged” to the summer period.
Find additional resources and training on the Effort Reporting System (under Post Award).