THE VANDERBILT UNIVERSITY Schedule of Findings and Questioned Costs Year ended June 30, 2006
Findings and Questioned Costs Relating to Federal Awards
Finding 06-01: Salary Cap Limitations for Research Personnel Federal Agency: U.S. Department of Health & Human Services Program: Various CFDA #: Various Award number: Various Award year: 2005-2006
OMB Circular A-21 section C.1 requires that charges for work performed on sponsored agreements by faculty members during the academic year will be based on an individual faculty member’s regular compensation for the continuous period which, under the policy of the institution concerned, constitutes the basis of his salary. By a mandate of Congress, salaries paid under grants, cooperative agreements, or other applicable contracts funded by the National Institutes of Health (NIH), a division of the Department of Health and Human Services, are subject to salary limitations. For FY06, the limitation in effect from July 1, 2005 to December 31, 2005 was $180,100; the limitation in effect from January 1, 2006 to June 30, 2006 was $183,500.
Finding and Perspective
In July 2006, joint internal/external audit procedures discovered through specific testwork performed on
NIH salary limitations.
cap requirements that certain employees in the sample had been paid in excess of salary cap As a result, the University performed a detailed review of 100% of the population of
employees paid out of This review included limitations compared to
NIH grants or contracts during FY06 a recalculation of each employee’s actual payroll expenditures charged to
per NIH salary
to determine the allowable earned NIH.
The results of the investigation found that 30 out of 212 University employees in the total population of individuals paid from NIH grants or agreements were paid amounts in excess of the salary cap during FY06.
The total questioned costs which were determined to be in excess of the established salary limitation were $156,991. This amount was calculated including total salary, fringe, and facilities and administrative (F&A) expenditures charged to any grant for each employee during the period from July 1, 2005 to June 30, 2006. The University began the process of returning these costs to the NIH through adjustments to draws and/or reimbursements to subcontractors in August 2006.