Grants and Funding

Proactive Compliance Site Visits FY 2000-FY 2004:
A Compendium of Findings and Observations

This document summarizes the observations and comments from the National Institutes of Health (NIH) Proactive Compliance Site Visits (PCSV)s. We are making this information available to the broader biomedical research community as an educational tool to promote awareness of and compliance with NIH policies. A key feature of the compendium is "Examples of Compliance in Action," which describes practices observed during the site visits and examples of tools used at some institutions.

TABLE OF CONTENTS

INTRODUCTION
     Background
     Participating Institutions
     Site Visit Process and Format
     NIH Core Site Visit Team
     Feedback from the Institutions
     General Observations

SUBJECT AREA DESCRIPTIONS AND OBSERVATIONS
     Roles and Responsibilities/Training and Education
     Financial Conflict of Interest
     Financial Management of Sponsored Programs
     Clinical Trial Data and Safety Monitoring
     Bayh-Dole Act/Invention and Patent Reporting



INTRODUCTION

Background

The NIH is the principal Federal agency responsible for biomedical and behavioral research and research training. As such, we are accountable to Congress and the general public for responsible stewardship of Federal research dollars. Sound management of research funds requires oversight by both the recipient institution and the sponsoring agency. The relationship between NIH and our grantees is predicated on trust, and we expect that grantees will properly administer the sponsored activities in accordance with the applicable regulations and policies.

NIH ensures integrity and accountability in its grant award and administrative processes by:

  • Requiring the grantee to have adequate internal controls
  • Requiring the grantee to provide appropriate oversight of individual research projects
  • Monitoring grants and grantee organizations through reviews of progress reports, financial reports, correspondence, audit reports, site visits, and other mechanisms
  • Providing technical assistance as needed

The Division of Grants Compliance and Oversight (DGCO) in the Office of Policy for Extramural Research Administration (OPERA), Office of Extramural Research (OER), NIH, was created to provide a focal point for the NIH extramural research program to advance external compliance with policy and legislative mandates and enhance compliance oversight by recipient institutions. The DGCO initiated a series of PCSVs in FY 2000 to assess institutional understanding of Federal policies and regulations, to minimize or eliminate noncompliance, and to nurture a productive partnership between the NIH and its grantee institutions. The success of the initial site visits resulted in continuance of the initiative in FY2001, FY2002, FY2003 and FY2004.

The site visits were not designed to address specific problems. They are not viewed as investigations or audits. Rather, they are conducted in a proactive mode, intended to facilitate dialogue regarding NIH policies in a non-crisis, non-adversarial manner. Through this educational outreach effort, we hope to enhance administrative oversight of sponsored research. We encourage representatives of the grantee institutions to join NIH as both partners and stewards in the conduct of biomedical research.

Participating Institutions

NIH uses several criteria to select institutions for PCSV participation, including the level and nature of NIH support and geographic and institutional diversity. NIH completed site visits with 10 institutions in FY 2000, 8 institutions in 2001, 8 institutions in FY2002, 5 in FY2003 and 6 in FY2004.

We wish to thank the following institutions for participating in the site visits. The site visits continue to be a positive learning experience for all involved due in large part to the cooperation and candor of the institutional participants.

Grantee Institutions Participating in the Proactive Compliance Site Visits

FY2000

Johns Hopkins University
University of Texas Southwest Medical Center, Dallas
University of California, San Francisco
Harvard University
Medical University of South Carolina
University of Miami
University of Arizona, Tucson
Indiana University, IUPUI
Oregon Health Sciences University
Vanderbilt University

FY2001

National Jewish Medical and Research Center
University of Colorado Health Sciences Center
Princeton University
University of Wisconsin, Madison
Howard University
The Scripps Research Institute
University of California, San Diego
Burnham Institute

FY2002

University of Hawaii, Manoa
Center for Health Studies
University of Washington
Whitehead Institute for Biomedical Research
Massachusetts General Hospital
University of Virginia
Utah State University
University of Utah

FY2003

Columbus Children’s Research Institute
Ohio State University
George Washington University
Washington University in St. Louis
Saint Louis University

FY2004

Georgia State University
Emory University
Carnegie Melon University
University of Pittsburgh
Roswell Park Cancer Center
State University of New York at Buffalo

Site Visit Process and Format

After initial discussions with institutional representatives, NIH provides each institution with guidance on the topics and expectations for each subject matter discussion. This guidance includes information to enable institutional representatives to self-select the staff members for participation in the site visit. We request that institutions submit materials related to the identified subject areas (e.g., copies of policies, forms, procedures, manuals, and organization charts) in advance. During the preparation period, the members of the NIH site visit team discuss their respective topic areas with the institution's staff members and answer questions about the site visit process.

The site visit topics address institutional understanding of Federal policies and regulations for the following topics:

  • Roles and Responsibilities/Training and Education
  • Financial Conflict of Interest
  • Financial Management of Sponsored Projects
  • Data Safety and Monitoring
  • Bayh-Dole Act/Invention and Patent Reporting

Selected site visits included discussion of additional topics, such as Clinical Gene Transfer Research and Hazardous Waste Disposal.

In general, the site visits are conducted over one and one-half days using a structured format. Each visit begins with a plenary session to orient participants to the structure and goals of the activity followed by breakout sessions to discuss specific topics. During the closing session, the site visit team shares observations and findings with institutional officials. As the site visits evolved, a half-day collaborative educational outreach seminar, presented by the NIH site visit team, was added. Topics include a compliance overview, the partnership between science and administration, administration for faculty/principal investigators (PI), research contracts, financial conflict of interest, financial management of sponsored projects, data and safety monitoring, and extramural intellectual property. The seminar is characterized as "education" rather than "training" because of the value added in understanding not only what is required, but also why it is required. This distinction is important in securing faculty buy-in and thereby developing and sustaining a culture of compliance.

NIH Core Site Visit Team

Diane Dean (Roles and Responsibilities/Training and Education; Chairperson for FY2001 & FY2002 site visits)
Director, Division of Grants Compliance and Oversight
Office of Policy for Extramural Research Administration
Office of Extramural Research

Cheryl Chick (Roles and Responsibilities/Training and Education)
Assistant Grants Compliance Officer
Division of Grants Compliance and Oversight
Office of Policy for Extramural Research Administration
Office of Extramural Research

Dennis Dixon, Ph.D. (Clinical Trial Data and Safety and Monitoring)
Chief, Biostatistics Research Branch
Division of Acquired Immunodeficiency Syndrome
National Institute of Allergy and Infectious Diseases (NIAID)

Susan Kauble (Roles and Responsibilities/Training and Education and Financial Conflict of Interest)
Assistant Grants Compliance Officer
Division of Grants Compliance and Oversight
Office of Policy for Extramural Research Administration
Office of Extramural Research

Sherley Mizzell (Financial Conflict of Interest)
Division of Acquisition Policy and Evaluation
Office of Acquisition Management and Policy
Office of the Director

Richard L. Mowery, Ph.D. (Clinical Trial Data and Safety Monitoring)
Chief, Epidemiology, and Behavioral Research Branch
National Institute for Dental and Craniofacial Research

Mike Payne (Financial Management of Sponsored Programs)
Director, Division of Financial Advisory Services
Office of Acquisition Management and Policy
Office of the Director

George Stone, Ph.D. (Bayh-Dole Act/Invention and Patent Reporting)
Chief, Extramural Inventions and Technology Resources Branch
Office of Policy for Extramural Research Administration
Office of Extramural Research

Regina H. White (Bayh-Dole Act/Invention and Patent Reporting)
Director, Office of Policy for Extramural Research Administration
Office of Extramural Research

Other site visitors who participated in more than one site visit:

Gary Thompson, former Chief, Grants Policy Branch, OPERA, and Chairperson for FY2000 site visits
Anthony Demsey, Ph.D. (Hazardous Waste Disposal)
Priscilla Grant (Roles and Responsibilities/Training and Education)
Mary Groesch, Ph.D. (Clinical Gene Transfer Research)
Robert Jambou, Ph.D. (Clinical Gene Transfer Research)
Tom McCormack (Financial Conflict of Interest)
Greg Pryor (Financial Conflict of Interest)
Kathleen Shino (Roles and Responsibilities/Training and Education)

Feedback from the Institutions

Overall, the institutions have responded very positively to the site visits. There has been universal praise for the proactive approach, which contributes to the development of mutual trust between NIH staff and the teams from the institutions involved in the site visits. Exchanges of information are constructive and helpful.

The following statements summarize comments provided by the institutions.

  • The discussion of issues in a non-crisis, non-adversarial manner was particularly helpful.
  • The atmosphere was collegial, interactive, fair, and instructive.
  • The site visits humanized the NIH.
  • Preparation for the site visit was a valuable activity, and the NIH presence strengthened the culture of compliance and associated practices.
  • Messages had particular value when heard directly from NIH staff.
  • The NIH team brought expertise to the institutions.
  • The closing plenary feedback session was valuable and educational.
  • The NIH approach to this initiative was refreshing.
  • Contacts made during the site visit will be useful.

General Observations

Institutions utilize many methods for enhancing institutional compliance.

Institutions want to be in compliance; they take this responsibility very seriously. However, they express concern about the cost of compliance.

The institutional commitment to compliance can be emphasized and enhanced by establishing compliance officer positions and/or an institutional compliance committee.

A PI handbook to assist faculty and staff with the administrative aspects of sponsored projects is a valuable tool.

Some institutions include a "help line" to provide information on compliance-related issues and to collect reports of noncompliance. This more proactive and positive approach subsumes the more traditional "hot line" and is likely to offer better results.

Computer-based tools can be helpful to foster compliance among PIs, program staff, and departmental administrators. Such tools include a checklist of items to be included with a grant application, a budget spreadsheet, and a template for a budget justification.

Some institutions use the post-award audit function to provide feedback to staff on why specific costs were disallowed. This can be an important educational opportunity.



SUBJECT AREA DESCRIPTIONS and OBSERVATIONS

Roles and Responsibilities/Training and Education

Description of Subject Area

The institution should have a program of ongoing institution-wide training and education of all responsible staff involved in NIH-supported research to ensure consistent and accurate guidance on policy interpretation is provided to faculty and staff. The institution should be committed to sustaining the training and education program to meet the needs of new employees and provide appropriate updates for all employees. Roles and responsibilities of PIs, departmental administrators, sponsored projects officials and other institutional offices that have responsibility in the areas of grant compliance and Institutional oversight should be clearly defined and communicated.

Related Regulation/Policy/Guidelines

NIH Grants Policy Statement

Grant Application (PHS 398)

Types of Materials Reviewed

  • Summary documentation to show the comprehensive delineation of functional roles and responsibilities and clearly established lines of responsibility
  • Institutional training plans and employee training and/or certification requirements
  • Descriptions of mandatory and or/recommended training requirements
  • Documents describing organizational responsibility for developing training programs and how training is tracked
  • Documents or publications that show how the institution informs employees and supervisors of their roles and responsibilities
  • Organizational charts
  • Websites that address the above

Institutional Representation

The institution is asked to include the following types of staff members to participate in this subject area discussion based on guidance from NIH:

  1. Staff with responsibility for NIH grants and contracts who are able to discuss roles and responsibilities/training and education issues and describe their responsibilities and interactions
  2. Staff who have responsibility for institution-wide training and education of individuals involved in sponsored projects research and administration
  3. Two teams, each consisting of a department chair, departmental administrator, and two PIs, one senior and one junior, with current NIH support, each team from within the same department (two teams of 4 people each)

Information Discussed During the Site Visits

  • Responsibilities and accountability as defined by the institution
    • The identification, organizational location, and functional responsibilities of those individuals with specific roles and responsibilities in the conduct and administration of Federally sponsored research (i.e., the responsible signatory official(s) who have authority to act on behalf of the institution, including signatory authority of applications and proposals; PIs; department chairs; departmental administrators; deans; sponsored projects staff; and others)
    • How these individuals interact and communicate with one another to assure proper compliance and oversight
    • How roles and responsibilities are defined and communicated and how this process may be improved
  • The institution's ongoing training and education program
    • How the institution identifies and ensures all appropriate employees are trained and kept updated
    • How the institution communicates training requirements (e.g., mandatory/recommended training requirements, timeframe for completion, etc.)
    • How the institution communicates changes in NIH policies and Federal requirements to employees
    • How the institution ensures that training and education meet the needs of employees' individual, organizational, and/or functional requirements
    • How courses are evaluated and revised
    • How the institution evaluates whether staff involved in sponsored programs receive sufficient information and direction to truly understand their individual roles and responsibilities
    • The effectiveness of the institution's training and education program
    • Obstacles, if any, in getting faculty buy-in to the training and education program and initiatives at the institution
  • How local and institutional oversight is achieved and challenges faced
  • Obstacles, if any, that make it difficult to develop an effective culture of compliance at the institution
  • Other related issues identified by the institution

Summary Observations

An institution fosters and enhances a culture of compliance when its leaders communicate it as an institutional expectation.

Communication is essential.

Many institutions have working groups or discussion groups for staff involved with grant and contract administration. Nevertheless, institutional staff felt that more interaction is needed to enhance communication and to serve as a forum for problem solving.

Some institutions have developed methods for establishing and maintaining good communication between groups responsible for pre- and post-award activities. These methods include regularly scheduled meetings, discussion/working groups, and committees (both formal and ad hoc). Furthermore, when directors of pre- and post-award activities make a commitment to establish an effective partnership, their staff also value and participate in this partnership.

Centralized availability of information on training can be helpful.

Many training courses are available from various sources, but few institutions have a central source of information on all available training for faculty and staff.

Site visits reveal duplicative training efforts within an institution. Centralization could help consolidate training efforts and provide an opportunity for evaluation of the focus of the training programs.

Many institutions have a large amount of information resources available at various locations on their web sites. Centralizing this information would make it easier to access and therefore more available.

Institutions may want to consider enhancing formalized education programs.

Most institutional mandatory training is limited to the requirements of Federal regulations and may not address other areas key to successful research administration.

Faculty and department chairs rely heavily on departmental administrators as the experts on grant application preparation. However, institutions rarely support these individuals with a formalized education program or training plan.

The PI is often responsible for preparing grant applications, but institutions rarely make grants administration training available to him/her. PIs often told the site visit team that they need/want basic grants administration training opportunities.

Although institutions have formalized education programs for sponsored programs staff, generally they provide no continuing education programs for staff involved with grants and contracts management. This is an especially notable deficiency for departmental administrators and PIs. The site visit team noted that there is often a perception that PIs cannot, or will not, be trained.

Close coordination of departmental administration and sponsored research offices can enhance compliance.

Duplicative roles between central offices of sponsored research and departmental administrators may impact negatively on an institution's ability to track information, such as other support.

Often there is no one office/person with the responsibility for ensuring the accuracy of information submitted for key personnel and other support.

Department staff at some institutions, do not coordinate/obtain approval from the office of sponsored research for pre-award costs, thereby jeopardizing reimbursement for these costs.

Some institutions assign a person, or team, to a PI or department who is responsible for pre- and post-award activities from cradle to grave. This provides consistency and enhances rapport between PIs and central sponsored projects offices.

Accessibility of written institutional policies and procedures is vital.

Site visitors found that compliance was reported as being easier at institutions where policies and procedures were maintained centrally, updated regularly, and made widely available online.

Faculty from institutions that do not have computerized systems to maintain current policy find it disconcerting that there is no written instruction, but they usually know who to call. This type of institution often relies heavily on a few key staff from the sponsored research offices to provide answers to faculty and staff.

Oversight is key to successful compliance

Oversight responsibilities should be assigned, and individuals with oversight responsibilities should have the appropriate authority to fulfill those responsibilities.

Oversight mechanisms and internal controls should be built into institutional policies and procedures.

Smaller institutions need policies, procedures, and internal controls to ensure compliance, but on a smaller scale than larger institutions.

Understanding individual responsibilities and those of others is vital to successful compliance. For example, many PIs view their responsibilities as solely scientific when in actuality they have an important role in fiscal and administrative oversight.

Examples of Compliance in Action

Roles and responsibilities should be defined, communicated, and accessible.

Some institutions provide a detailed listing of responsibilities, including oversight responsibilities, by role. The on-line listing links to related resource information, such as institutional requirements, policies and procedures, cognizant offices, subject matter experts, contact information, as well as to training and education opportunities.

The institutional commitment to compliance can be emphasized and enhanced by establishing a compliance office position and/or office or committee.

Training/continuing education should be encouraged.

Ongoing institution-wide training is provided on grants and contracts administration for individuals who have a role in NIH-supported research. Such training provides information/orientation for new employees and updates for all employees.

An education coordinator develops and coordinates training throughout the institution.

Institutions provide a grid matching each profession/job classification with available training, both mandatory and elective. This information is posted on the web and linked with roles and responsibilities.

Institutions enforce mandatory training and continuing education by imposing consequences for non-compliance. (For example, essential card use activated or research funds released only after completion of training is confirmed.)

Web-based training programs augment rather than supplant the traditional classroom setting.

Certification programs for pre- and post-award and departmental administrator positions that include specific training requirements.

Supervisors identify training needs in employee performance evaluations.

Training/staff development tied to institution's reward system to provide further incentive.

Individual training plans ensure a standardized level of knowledge.

Mandatory new faculty mentoring programs are helpful for PIs.

Use of internal audit findings to identify areas where additional or specific training is needed.

Use of computer-based tools or friendly-audits to self test and assess level of knowledge and raise awareness of needs.

To promote faculty buy-in, use respected faculty leaders to participate in the development of faculty training programs and as teaching staff for faculty training programs.

Use of web based portals as an innovative way to tailor individual needs for training and resource information.

Use of Microsoft "wizard" as a tool to guide faculty through a process such as writing an Institutional Review Board (IRB) protocol or reporting an adverse action.



Financial Conflict of Interest

Description of Subject Area

Financial conflict of interest regulations promote objectivity in research by establishing standards to ensure that there is no reasonable expectation that the design, conduct, or reporting of research funded under PHS grants, cooperative agreements, or contracts will be biased by any conflicting financial interest of an investigator. The regulations apply to each institution that applies for PHS grants, cooperative agreements, and contracts and to each investigator participating in such research. These regulations do not apply to the Phase I SBIR/STTR program.

Institutions must establish written policies and procedures to address financial conflict of interest for their investigators. These standards and procedures are designed to ensure that investigators maintain research objectivity in the design, conduct, analysis, and reporting of research funded under PHS grants, cooperative agreements, or contracts.

Related Regulation/Policy/Guidelines

42 CFR Part 50 Subpart F for Grants and 45 CFR Part 94 for Contracts, published in the NIH Guide, Objectivity in Research

NIH Grants Policy Statement, Part II, Conflict of Interest

OER COI Page

Grant Application (PHS 398)

NIH Review of Institutional Conflict of Interest Policies

Types of Material Reviewed

  • The institution's written, enforced policy concerning research investigators' financial conflict of interest
  • Organizational charts that show where the conflict of interest function resides
  • The guidelines created by the institution for the Designated Official to identify financial conflict of interest
  • A description of the enforcement mechanisms and sanctions used to implement the Institutional financial conflict of interest policy
  • Financial conflict of interest files maintained by the institution
  • Minutes of conflict of interest meetings for the past two calendar years
  • Determinations/findings made by the Designated Official
  • Management plans, action plans, activities, agreements, or other documents used to manage, reduce, or eliminate conflicts
  • Correspondence, if any, between the institution and NIH relating to the financial conflict of interest process

Institutional Representation

The institution is asked to include the following types of staff members to participate in this subject area discussion based on guidance from NIH:

  1. Designated Official
  2. Conflict of interest committee members from current committee roster
  3. Investigator who had an identified conflict of interest or who had been through the financial disclosure process

Information Discussed During the Site Visits

  • Operational aspects of the institutional financial conflict of interest process as well as the roles and responsibilities of the Designated Official and any financial conflict of interest committee members, if such a committee exists
  • How research investigators and others are affected by the institutional financial conflict of interest policy
  • How to improve the financial conflict of interest process at the institutions and between the institution and NIH
  • How the institutions share/inform the IRB(s) of conflict of interest issues pertinent to IRB activities
  • How institutions view the issue of institutional conflict of interest

Summary Observations

Outreach and education are important.

Generally, institutions do not have adequate outreach and education for their faculty regarding the financial conflict of interest regulations.

Some confusion exists about the institutional interpretation of the regulatory definition of "Significant Financial Interest."

Faculty members perceive that identifying conflicts of interest is a blemish on their research or professional standing. It is not clear if they understand that financial conflict of interest is not inherently wrong as long as it is disclosed to their institution and is managed, reduced, or eliminated.

There seems to be some element of distrust between faculty and their own institution, as well as between faculty and the NIH. Some faculty expressed fear that full disclosure might result in a reduction in their institutional salary or adversely affect NIH funding.

Outreach and education should target efforts to explain the issues in conflict of interest and reduce the stigma associated with this issue.

A system for reviewing and managing financial conflicts of interest must be present.

  • Most institutions have Conflict of Interest in Research Committees to address conflict of interest.
  • The standards in the PHS regulations are often applied to non-PHS research projects.
  • In cases where states or other entities impose more restrictive standards governing financial reporting, (e.g., where reporting of financial interests is required for a broader group of individuals or where lower thresholds are required for reporting), the more restrictive standards are often applied to PHS-funded research projects.

Institutions are not reporting financial conflicts of interest to NIH as required.

Institutions have determined the existence of financial conflicts of interest and have developed plans to manage these conflicts, but have not reported the conflicts to the NIH.

Some institutions are unaware of the requirement to report the existence of a conflict.

Examples of Compliance in Action

Information is made accessible.

A brochure summarizing the Federal regulations and state law and how they are complied with at an institution.

Development of a case study that is used in training and aids in understanding how to recognize and manage financial conflicts of interest and conflicts of commitment.

Financial conflict of interest policy and associated forms are made available on-line.

A process is in place to identify and manage conflicts.

A routing cover page for PHS grant applications or contract proposals that requires investigators to indicate if a significant financial interests exist. This form includes the PHS definition for "significant financial interest" and "investigator" to make clear what must be addressed and that the financial interests of spouses and dependent children must be considered.

When an investigator has a significant financial interest, that investigator, working with the department chair, develops and presents to the Conflict of Interest in Research Committee a resolution plan that details proposed steps that will be taken to manage, reduce, or eliminate the conflict. The Committee reviews the plan and may approve it or add conditions or restrictions. When a resolution plan has been finalized, an institutional representative (perhaps the Designated Official) and the investigator sign a Memorandum of Understanding that reflects the plan.

A subcommittee of the conflict of interest committee uses a three tier system to decide whether financial interests should be reported to the full committee: category 1 - not reportable; category 2- low potential for bias; category 3 - moderate to high potential for bias. Category 3 and some category 2 result in development of management plans.

A regularly scheduled forum allows faculty to freely discuss potential conflicts with institutional officials, which may include the Designated Official and/or the Conflict of Interest in Research Committee.



Financial Management of Sponsored Programs

Description of Subject Area

The institution's financial management systems should provide information and tools, including timely reports of account status, to all staff, especially PIs, departmental administrators, and others, involved in the conduct and administration of NIH-supported research.

Fiscal management reports should be provided to PIs and departmental administrators that display project-specific data in a variety of ways including, but not limited to, the following:

  1. A project-specific summary prepared at the end of the month;
  2. Project-specific reports that are updated daily; and,
  3. Project-specific activity reports that indicate amounts budgeted, encumbered, expended, and balances remaining.

The institution's financial management system must provide for the timely and accurate submission of required financial reports to Federal sponsors.

Related Regulation/Policy/Guidelines

45 CFR 74.20 and 45 CFR 74.50

OMB Circulars A-21, A-122, and A-110

NIH Grants Policy Statement

Types of Material Reviewed

  • A copy of the institution's written policies and procedures concerning:
    • Creation of grant/contract accounts
    • Monitoring/oversight of grant/contract accounts
    • Prior approval requirements
    • Correction of mischarged expenses, i.e., cost transfers
    • Preparation and submission of Financial Status Reports (FSR)
    • Treatment of unobligated balances (e.g., effect on progress of research) and carryover of funds
    • Closeout of grants/contracts, especially with respect to FSRs
    • Any institutional documentation which implements the above


  • Any documents that illustrate the financial management systems in place at the institution, e.g.,:
    • Grant/contract files
    • Sample reports
    • Electronic processes

Institutional Representation

The institution is asked to include the following types of staff members to participate in this subject area discussion based on guidance from NIH:

  1. Officials and staff from the sponsored projects office who have pre-award and post-award responsibilities and who are able to discuss sponsored projects financial management issues
  2. Director, Internal Audit (and/or other Internal Audit staff as appropriate)
  3. Senior PI who has current NIH support with his/her departmental administrator
  4. Junior PI who has at least one NIH RO1 grant with his/her departmental administrator

Information Discussed During the Site Visits

  • Institutional written policies and procedures concerning the following:

Creation of grant/contract accounts
Monitoring/oversight of grant/contract accounts
Prior approval requirements, i.e., institutional and NIH prior approval
Correction of mischarged expenses (e.g., cost transfers)
Preparation and submission of FSRs
Treatment of unobligated balances (e.g., effect on progress of research) and carryover of funds
Closeout of grants/contracts, especially with respect to FSRs
Institutional documentation (including web sites) that implements the above
Any documents that illustrate the financial management systems in place at the institution, such as sample reports, or electronic processes

  • Operational aspects of the institution's financial management/reporting process as well as roles and responsibilities of those individuals involved in the process


  • Improved financial management/reporting process at the institution and between the institution and NIH

Summary Observations

Institutions handled financial management of sponsored projects in similar ways.

At many institutions, pre-award and post-award offices are organizationally and sometimes geographically separate. The separation of the two offices sometimes contributes to problems related to communication and interaction between employees in the two groups.

All institutions operate similarly with regard to the financial management of sponsored projects. PIs rely almost exclusively on departmental administrators to provide the advice and assistance needed to financially manage their projects. Departmental administrators rely heavily on officials in centrally located pre-award and post-award "Sponsored Projects" offices to provide advice, training, financial reports, policy guidance, and interpretation.

At many institutions, the lack of timely and accurate financial information is problematic and results in formal or informal "shadow" accounting systems maintained by departments. Many institutions have accounting/financial systems that can provide on-line access to financial reports and information that is updated daily and include encumbrances. Nevertheless, many departments still maintain shadow accounting systems to track expenses generated within the department.

Many institutions have an internal audit function. While the extent of each internal audit office's involvement in the review of sponsored projects varies, the presence of an internal audit function appears to contribute to a culture of compliance.

Oversight is important

Sponsored programs officials need to be more actively involved in financial oversight. Monthly financial information is typically provided to PIs; however, financial oversight of sponsored projects by centralized sponsored programs officials tends to be delegated to departmental officials.

Providing FSRs to PIs, either before or after submission, allows them to verify the accuracy of the information submitted to sponsors.

Policies should be accurate and accessible

Internal policies available on institutional web sites are well received by institutional personnel.

Cost transfer policies tend to be nonexistent, incorrect, or confusing, and the requirements for making appropriate cost transfers are often misunderstood by institutional officials, especially PIs, and departmental administrators.

Examples of Compliance in Action

Institutions have fostered a "culture of compliance."

Those responsible for internal audits have high-level support at the institution and are very involved with sponsored projects, e.g. performing reviews and participating in training.

The Internal Audit Office provides input into the development of institutional policies and procedures.

Institution has a hot line where anonymous allegations may be made.

A Sponsored Projects Expenditure Compliance Office (post-award) is extremely effective at monitoring charges to sponsored projects, identifying questionable or inappropriate charges and formally notifying appropriate institutional officials when necessary.

An initial training class required for PIs, and an every-three-year refresher training requirement, raises the awareness of financial management requirements.

A proposal information quick reference laminated, color-coded guide provides a convenient reference for pre-award and post-award staff, departmental administrators, and PIs. The guide contains pertinent contact and fiscal information.

Systems are in place to help monitor and control expenditures.

The Vice President/Chief Administrative Officer and the Director of Finance and the Director of Sponsored Research (Pre-award) and the Manager of Grants Accounting (Post-award) meet with a PI if projected expenses on one or more of his/her sponsored projects exceed +/- 10% of the award amount and an action plan is developed and agreed to by the PI and the Manager of Grants Accounting to control spending.

Special financial reports from the accounting system allow for "what if" scenarios, e.g., changing percent of effort for one or more individuals on a grant(s) to reflect the impact on total grant expenditures.

Internal Audit has a contract and grants administration internal control questionnaire that it uses for all departmental audits in which the department has grants and contracts.

On-line access to financial systems, which are updated daily and include encumbered expenses, maximize institutional officials' ability to financially manage sponsored projects.

On-line system for retrieving sponsored project financial information provides timely and accurate information and is user friendly.

PIs are required to download and sign monthly project expenditure reports to certify that they have reviewed and agree with charges to their projects.

Where monthly "hard copy" financial reports are provided to PIs, each must be initialed to indicate that the reports have been reviewed for each project to ensure all charges are appropriate. Electronic signatures allow PIs to indicate they have reviewed the expenditures on-line.

Grant and Contract Accounting Office (post-award) performs a random review of selected categories of transactions on every grant at expiration to ensure compliance with sponsor regulations and the cost principles.

Grant and Contract Accounting Office (post-award) performs spot checks of areas in which there are repeated findings during close out reviews or if repeated questions from a department give an indication of a misunderstanding or lack of understanding of an issue or cost.

To expedite preparation of FSRs, starting 90 days before the end of the budget period, a message automatically appears on monthly financial reports provided to PIs reminding them to submit required financial closing documents on a timely basis, record all expenditures, make necessary adjustments, and liquidate or cancel all outstanding encumbrances.

To expedite preparation of FSRs, a memo is sent by the post-award office to each PI fourteen days after a grant's expiration date identifying what must be done in the department before the FSR can be submitted to the sponsor. The PI, or departmental administrator, must sign and return the memo indicating that the expenditures on the grant account are accurate and the FSR can be submitted.

A letter is sent to each PI ninety days prior to end date of a project period informing him/her that the project is about to end and all work must be completed and all transactions processed in order for the FSR to be prepared and submitted to the sponsor in a timely manner.

FSRs are reviewed by departmental administrators prior to being submitted to the sponsor.

The Office of Sponsored Research provides the PIs with a summary of the terms and conditions of each grant award.

The organization of the institution encourages communication.

Pre-award and post-award employees are organizationally and geographically co-located in the same office. This arrangement facilitates and enhances communication between employees in the two groups, allows for cross training of employees, and enables each group to readily assist the other during busy times. This arrangement also minimizes conflicts regarding the allowability of costs that might have been inappropriately proposed as direct costs, "approved" by pre-award officials and funded as direct costs but subsequently not allowed by post-award officials since direct charging of such costs would not be in conformance with the institution's accounting system.

One person in the Office of Sponsored Programs specializes in Cost Accounting Standards issues, and the Cost Accounting Standards are taken very seriously at the institution.



Clinical Trial Data and Safety Monitoring

Description of Subject Area

The regulations and policies on data and safety monitoring of clinical trials funded by NIH contribute to the protection of human research participants.

Related Regulation/PolicyGuidelines

45 CFR Part 46 Subpart A

NIH Guide - NIH Policy for Data and Safety Monitoring

NIH Guide - Further Guidance on Data and Safety Monitoring for Phase I and Phase II Trials

NIH Guide - Guidance on Reporting Adverse Events to Institutional Review Boards for NIH-Supported Multicenter Clinical Trials

Types of Material Reviewed

  • Any institutional documentation that describes procedures for notification of NIH in cases of "any unanticipated problems involving risks to subjects or others" or "any suspension or termination of IRB approval" occurs.
  • Any institutional documentation that describes procedures for identification of an independent safety monitor or monitoring group when needed.

Institutional Representation

The institution is asked to include the following types of staff members to participate in this subject area discussion based on guidance from NIH:

  1. IRB member(s) and staff
  2. A group of at least 3 relatively senior investigators for single site or multi-center trials selected by the institution. Each investigator could invite other staff such as clinic coordinators, data managers, or others who assist in patient recruitment, consenting and preparing/processing materials for the IRB, etc.
  3. A group of at least 3 relatively junior investigators for single site or multi-center trials selected by the institution. Each investigator could invite other staff such as clinic coordinators, data managers, or others who assist in patient recruitment, consenting and preparing/processing materials for the IRB, etc.

Information Discussed During the Site Visits

  • Institutional procedures for notification of NIH in cases of "any unanticipated problems involving risks to subjects or others" or "any suspension or termination of IRB approval"
  • Institutional procedures for identification of an independent safety monitor or monitoring group when needed
  • Examples of IRB suspension or termination of approval for NIH-sponsored clinical trials
  • Recent experience with filing of multi-center trial data and safety monitoring board summaries with the IRB
  • Ways to improve the institutional data and safety monitoring process
  • Identification of how financial conflict of interest information is shared with IRBs and how the IRBs treat the information
  • Any other related issues identified by the institution

Summary Observations

Institutions support the idea of enhanced oversight of clinical trials.

Grantee institutions generally support the need for greater attention to data and safety monitoring of clinical trials, in the interest of both protecting study participants and protecting the credibility of trial results.

Without exception, the local IRBs are ready to take some responsibility for institutional oversight of trial monitoring beyond the review of periodic updates of trial progress.

Institutions worry about the requirements.

Investigators worry to some extent that implementation will be overly constraining and burdensome. Moreover, recent guidance on monitoring plans for Phase I and II trials did not specify NIH expectations about the form that monitoring should take.

Reporting requirements that involve different criteria for reporting of adverse events increase the difficulty of complying.

Institutional officials and investigators are concerned about the level of new resources needed to support additional Data and Safety Monitoring (DSM) efforts. They believe that DSM is far more important than other activities that consume institutional resources, such as complying with and documenting compliance with administrative procedures of IRB review.

Training is important

A well developed training program is important to ensure adherence to required insititutional and Federal requirements for conducting clinical research.

Examples of Compliance in Action

Development of clear guidelines for the management of clinical trials is helpful.

Development of a "Policy and Procedures for Data and Safety Monitoring" that contains a series of template DSM plans and other materials for use with trials of various types.

Clear guidelines for protocol development, data and safety monitoring implementation and review, and education of investigators.

The institution provides detailed checklists to help investigators write research protocols and monitoring plans.

IRBs have assumed less traditional duties.

To ensure the adequacy of monitoring plans, IRBs require these plans as part of their initial protocol review.

The IRB tracks completion of the computer-based training module for human subjects protection and will not approve a new project without it.

There are different ways to monitor trials.

In some institutions a General Clinical Research Center (GCRC) is involved in much of the trial research and is well positioned to monitor through its existing committee structure. In collaboration with the National Center for Research Resources (NCRR), GCRC program directors are developing new strategies to enhance monitoring.

The monitoring of a small, single-site trial usually relies on the trial chair to periodically compile the data for review with either a designated colleague (preferably named in the plan) not involved with the trial, or a group of such colleagues, obtaining critical feedback. The reports address accrual, retention, protocol compliance, safety, and other trial outcomes as appropriate. Any significant changes in study design or conduct are reported to the local IRB and to NIH program staff. The fact that review took place is documented, but need not be reported in every case to the NIH. This approach will probably work best in centers and other fairly large departments, where there is a critical mass of senior investigators. In such cases it is common to have regular meetings at which investigators present the latest data from their studies.

Meaningful monitoring of multi-center Phase I trials requires a data center whose staff can quickly process data and generate summary listings and tabulations; summaries are distributed to all of the participating investigators weekly or biweekly, with follow-up conference calls. This approach, with conference calls less frequent, is utilized for Phase II trials involving relatively risky treatments. Otherwise, less intense monitoring is appropriate, organized perhaps following the Data and Safety Monitoring Board approach.

Some institutions may find it efficient to appoint a special internal data and safety monitoring committee as a resource for trials when an independent DSMB is not needed. The committee could be administered as an adjunct to the IRB, but needs to operate separately, because IRBs are typically stretched too thin already.

A central institutional committee to review and evaluate adverse events and provide advice to the IRB.

Training and reliable information improve compliance

An education course required of all new research coordinators that reviews the requirements and process for performing clinical research, including IRB, adverse event reporting, and data quality assurances.

A central office that faculty and staff can turn to with questions concerning IRB procedures, IND requirements, and general quality assurance issues.



Bayh-Dole Act/Invention and Patent Reporting

Description of Subject Area

The Bayh-Dole Act allows for grantee/contractor organizations to retain intellectual property rights for inventions and patents derived or first reduced to practice with funds awarded via government funding agreements. Rights by the grantee/contractor organization are retained subject to reporting of the invention(s), patent(s), and invention(s)' utilization consistent with provisions of 37CFR Section 401.14.

Related Regulation/Policy/Guidelines

The Bayh-Dole Act (P.L. 96-517) - Bay-Dole related Implementing Regulations at 37 CFR Section 401.14

NIH Grants Policy Statement

Invention Reporting - Edison

Grant Application (PHS 398)

Types of Material Reviewed

  • Copy of employee agreement (cf. 37CFR 401.14(f)(2)
  • Copy of institution's intellectual property policy
  • Copy of office procedures that describe Bayh-Dole reporting compliance tasks

Institutional Representation

The institution is asked to include the following types of staff memebers to participate in this subjest area discussion based on guidance from NIH:
  1. Director of the Technology Transfer Office
  2. Technology Transfer staff in charge of Federal invention reporting
  3. Licensing specialists/technology transfer office staff
  4. Junior PIs
  5. Senior PIs

Information Discussed During the Site Visits

  • Interagency Edison Invention Reporting system http://iedison.gov
  • Institutional policies and procedures concerning employee agreements as required by 37 CFR 401.14(f)(2)
  • Institutional policies and procedures implementing Bayh-Dole reporting requirements
  • Communication between the grantee organization and NIH on technology transfer issues

Summary Observations

Investigators need to understand their role in invention reporting.

Most investigators are aware of their obligatory role in reporting of inventions to institutional officials.

Many institutions do not emphasize intellectual property policy or invention reporting as part of either the orientation of new employees or as part of the execution of employee agreements

Faculty members are more likely to report inventions to institutional technology licensing staff when they recognize benefits of technology transfer to their research program and their institution.

Few grantee organizations have adequate human resources to regularly visit labs to "search out" subject inventions. Small institutions come closest to achieving this ideal, since they afford a better ratio of the number of technology transfer professionals to scientists. Typically, technology transfer staff devote existing resources to educate PIs as to the importance of technology transfer and invention reporting. This widely-practiced approach relies on PIs to inform institutional technology transfer officials of new inventions.

Most institutions use the Federal computerized reporting system.

Most institutions use the iEdison web-based invention and patent reporting system and consider it a valuable, easy to use system. At the same time, the majority of institutions using iEdison requested more timely response from NIH staff. NIH is nearing completion of a redesign effort to update the iEdison system and has added significant numbers of staff.

Institutions are endorsing guidelines.

Institutions are including reference to the NIH Research Tools Guidelines as part of Material Transfer Agreements (MTAs). This observation suggests that institutions are, with greater frequency, endorsing the guidelines and promoting them in negotiation of MTAs.

Strong technology transfer programs have the support of the institution.

The strongest technology transfer programs have discretionary funds specifically earmarked for use by faculty who are in pursuit of specific licensing opportunities. When such funds had been made available, processes were in place to recoup funds out of the revenue generated once successful licensing has been accomplished.

Partnering may increase invention licensing.

The establishment of close working relationships between an institution and local biotechnology or applied bioscience companies enhances prospects for invention licensing.

Examples of Compliance in Action

Technology transfer staff may be best positioned to address federal invention reporting.

Assignment of institutional staff dedicated solely to federal invention reporting improves Bayh-Dole compliance. Assignment of Federal invention reporting away from any institutional technology transfer component appears counter to good compliance practices.

Support comes from the top.

The full support and active participation in support of technology transfer by the highest levels of any institution leads to improved awareness of the value of technology transfer. This paves the way for technology transfer professionals to educate and expect participation and invention reporting compliance by faculty.

Education is critical.

Smaller institutions typically have higher ratios of technology transfer professionals to faculty. This allows for improved invention reporting compliance through one-on-one interactions between technology transfer professionals and faculty. Larger institutions more typically rely on broad outreach activities to engage faculty. Accordingly, at larger institutions a diverse set of outreach opportunities and means to educate faculty appear more critical than at smaller institutions.

Most institutions do not include technology transfer as a formal aspect of faculty orientation, either at time of employment or as part of periodic contract review. Inclusion in faculty/employee orientation could improve technology transfer awareness and invention reporting compliance.

Scientific colleagues rather than administrative professionals provide the most successful intellectual property education. However, creative ways are being used to "immerse" investigators in the importance of the timely transfer of technology, including web sites, brown bag seminars, brochures, and presentations on technology licensing to faculty, departmental chairs, and scientific staff.

Systems are in place to support invention reporting.

The most compliant institutions have electronic database systems to monitor invention reporting milestones and deadlines. Use of such systems is critical for accurate tracking and improved reporting compliance at any sized institution.

A committee of technology licensing staff meets regularly to discuss title election, patent application, and licensing strategy. Such meetings offer excellent opportunities to maintain awareness of outstanding invention reporting compliance issues.

Faculty meetings that acknowledge the technology transfer successes of key personnel on specific projects allow for a timely emphasis of intellectual property and technology transfer benefits.

To ensure that Federal support is properly acknowledged, funding information provided by the inventor is cross-referenced with institutional grant award databases to identify potential sources of support for any invention.

Review of all manuscripts and abstracts by institutional technology transfer staff will all but rule out underreporting of Bayh-Dole-related inventions. The added benefit of this approach is that it promotes close interaction between technology transfer professionals and faculty.

Initial Posting: November 7, 2002
Updated: May 30, 2007

This page last updated on May 30, 2007
Content Manager: GrantsCompliance@nih.gov 
Technical Issues: E-mail OER Webmaster