Performance Audit of Incurred Costs – Clemson University

Direct Clemson to strengthen its monitoring procedures and internal control processes for applying indirect costs to Federal awards. Updated procedures could include: a. Requiring that personnel assess whether Clemson should capitalize ongoing and future construction projects. Specifically, Clemson should consider Federal regulation specific to the capitalization of construction related to additions to, improvements to, alterations of, or reconfigurations of Clemson buildings when Clemson uses Federal funding to finance construction. b. Requiring that personnel manually review capitalized charges made to an award to ensure that Clemson has included all applicable costs in the capitalized amount. Specifically, Clemson should consider whether capitalized costs account for items such as installation, shipping, and sales tax before capitalizing the expense. c. Requiring additional training for personnel who review and approve computer charges that exceed $5,000 to ensure that they are able to identify whether Clemson appropriately categorized the goods as supplies or equipment. d. Implementing an annual review process for costs charged to awards that include funding for subaward expenses that exceed $25,000 to ensure that Clemson is appropriately segregating these expenses in accounts that it has excluded from its Modified Total Direct Cost base. e. Implementing an annual review process for costs charged to awards that include funding for participant support costs to ensure that Clemson is appropriately segregating these expenses in accounts that it has excluded from its Modified Total Direct Cost base.

Direct Clemson to provide documentation supporting that it has repaid or otherwise credited the $36,847 of questioned equipment, travel, other direct costs, and publication costs for which it has agreed to reimburse NSF.

Direct Clemson to encourage Principal Investigators to identify and report all awardrelated travel in their annual reports to NSF.

Direct Clemson’s Office of Grants and Contracts Administration to provide training on how to assess the methodology for allocating publication costs across each sponsored award acknowledged in the publication and document the justification for this methodology.

Direct Clemson to periodically assess the fee structure and period allotted for access to the computer cluster node infrastructure. Updated procedures could include: a. Requiring the Office of Grants and Contracts Administration to assess whether projects require access to the computer infrastructure. b. Establishing the time and fee structure as a specialized service center to ensure appropriate cost objective control.

Resolve the $4,396 in questioned participant support and service center expenses for which Clemson has not agreed to reimburse NSF and direct Clemson to repay or otherwise remove the sustained questioned costs from its NSF awards.

Resolve the $2,151 in questioned travel and salary costs for which Clemson has not agreed to reimburse NSF and direct Clemson to repay or otherwise remove the sustained questioned costs from its NSF awards.

Direct Clemson to strengthen its administrative and management processes and procedures surrounding the approval of travel expense reports. Updated procedures could include: a. Establishing clear guidance regarding the allowability of registration fees when individuals are no longer able to attend the event. b. Developing a procedure to evaluate travel that occurs near the end of an award and remove any travel costs associated with trips that occur after the award expires. c. Conducting annual training for individuals responsible for reviewing and approving expense reports within each department, to define what expenses are allowable on a sponsored program. d. Establishing clear guidance regarding the booking of lodging and what constitutes moderately priced accommodations. e. Reviewing all foreign airfare purchases before charging them to sponsored programs to verify that the airfare complies with the Fly America Act.

Direct Clemson to establish procedures to ensure that its salary payments do not exceed the employee’s Institutional Base Salary.

Direct Clemson to ensure that it has performed risk evaluations for all subawards issued prior to June 2018 and that these risk evaluations remain active, to validate the agreements in accordance with Federal regulations.

Direct Clemson to update its current procedures and internal controls to ensure that Principal Investigators submit final reports to NSF in accordance with NSF’s terms and conditions. Updated procedures should require Clemson to verify the submission of the final report with both the Principal Investigators and NSF during project close-out or when the Principal Investigator is leaving Clemson.

Direct Clemson to strengthen its administrative and management procedures to confirm it has completed the subrecipient documentation package before approving non-budgeted subawards.

Direct Clemson to strengthen its administrative and management processes surrounding document retention for purchases on sponsored awards.

Direct Clemson to strengthen its directives, procedures, and internal controls for procuring contract services on sponsored projects. Updated processes could include the following: a. Conducting annual training for those individuals who procure contract services, including Principal Investigators. The training should include topics such as the process for obtaining approvals for contractors on sponsored programs, the documentation needed before work begins, and the purchase order process required before issuing payment. b. Requiring individuals who initiate contract services to complete the applicable information in the appropriate procurement forms, as required by Clemson policy for contracted service agreements on sponsored projects.

Direct Clemson to update its current award set-up practices to require that, when setting up accounts established for NSF awards, personnel ensure that the accounts apply indirect costs using the rates that were established in the Negotiated Indirect Cost Rate Agreement in effect as of the date of the NSF grant award (except in instances where the award letter or supplement letter specifies otherwise), rather than using the rates included within the original grant proposal.