oversight

Gallaudet University's Internal Controls Over Federal Funds

Published by the Department of Education, Office of Inspector General on 2009-05-20.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                UNITED STATES DEPARTMENT OF EDUCATION
                                                         OFFICE OF INSPECTOR GENERAL

                                                                                            Audit Services, Region III, Philadelphia



                                                            May 20, 2009
                                                                                                    Control Number
                                                                                                    ED-OIG/A03I0009

Dr. Robert R. Davila
President
Gallaudet University
800 Florida Avenue, NE
Washington, DC 20002

Dear Dr. Davila:

This Final Audit Report, Control Number ED-OIG/A03I0009, entitled Gallaudet University’s
Internal Controls Over Federal Funds, presents the results of our audit. The purpose of the audit
was to determine if Gallaudet University (GU) had adequate internal controls in place to account
for Federal grant funds, and to review expenditures charged to Federal education funds,
excluding Title IV Federal student aid, for the period of October 1, 2005, to September 30, 2007,
to determine if expenses charged were reasonable, allocable, and allowable.



                                                      BACKGROUND 



GU, located in Washington, D.C., is a federally chartered, private, nonprofit educational
institution providing elementary, secondary, undergraduate, graduate, and continuing education
programs for persons who are deaf. GU receives approximately 67% of its operating revenues
by direct appropriation from the Federal government under the authority of the Education of the
Deaf Act (EDA), as amended, 20 United States Code (USC), Chapter 55, Education of the Deaf
§§ 4301-4363. GU enrolls approximately 1,800 undergraduate and graduate students.

The EDA also authorizes GU to maintain and operate the Laurent Clerc National Deaf Education
Center (Clerc Center) to carry out elementary and secondary education programs, projects, and
activities for the primary purpose of developing, evaluating, and disseminating innovative
curricula, instructional techniques and strategies, and materials that can be used in various
education environments serving individuals who are deaf or hard of hearing throughout the
Nation. The Clerc Center consists of the Kendall Demonstration Elementary School and the
Model Secondary School for the Deaf. The Clerc Center enrolls approximately 350 elementary
and secondary school students. Pursuant to the EDA, the Secretary of the U.S. Department of
Education (the Secretary) and GU must establish, and periodically update, an agreement
 The Department of Education's mission is to promote student achievement and preparation for global competitiveness by fostering educational
                                                   excellence and ensuring equal access.
Final Report
ED-OIG/A03I0009                                                                     Page 2 of 16

governing the operation and national mission activities of the elementary and secondary
education programs at the University.

The EDA requires GU to submit an annual report to the Secretary which details performance
data and use of appropriated funds. GU had recently been under pressure from the U.S.
Department of Education (the Department) and its accrediting agency to improve performance
related to student outcomes, due to a failure to meet goals for key Government Performance
Results Act performance indicators. The Office of Management and Budget’s (OMB)
ExpectMore website1 noted that they were working with GU on the following:

       To add or refine performance measures related to student outcomes and develop
        strategies to improve outcomes related to staying in school, graduation, and employment.
       Implementing the agreed upon monitoring plan for the federally funded programs at GU
        to document the use of funds, assess program quality, and determine compliance with
        governing documents.
       Developing a study to identify barriers to and strategies for improving GU's performance
        in the key areas of persistence, graduation, and post-school outcomes.

The funds appropriated to GU under the EDA must be expended in accordance with the purposes
of the EDA. In general, 20 USC § 4353 (c)(1), Limitations, regarding expenditure of funds,
provides that appropriated funds may not be expended for the following: alcoholic beverages;
goods or services for personal use; housing and personal living expenses (but only to the extent
such expenses are not required by written employment agreements); lobbying (except that GU
and the National Technical Institute for the Deaf are not prohibited from educating the Congress,
the Secretary, and others, regarding programs, projects and activities conducted at those
institutions); and membership in country clubs and social or dining clubs and organizations.
Furthermore, 20 USC § 4353 (c)(2)(A), Policies, states that “[n]ot later than 180 days after
October 16, 1992, the University and NTID shall develop policies, to be applied uniformly, for
the allowability of expenditures for each institution. These policies should reflect the unique
nature of these institutions. The principles established by OMB for costs of educational
institutions may be used as guidance in developing these policies.”

GU received $107 million in appropriated funds in fiscal years (FYs) 2006 and 2007.2 GU’s
total expenditures for our audit period were $312,791,187, including $237,791,619 expended for
general operations. Additionally, for the six grants included in our review, GU expended
$5,182,618 in non-Title IV Federal education grant funds, as shown in the following table:




1
  More detailed information on GU’s performance is available at
http://www.whitehouse.gov/omb/expectmore/detail/10003306.2006.html
2
  GU’s fiscal year ends on September 30th.
Final Report
ED-OIG/A03I0009                                                                               Page 3 of 16


                          CFDA3                                                  AMOUNT        AMOUNT
       GRANT                                       PURPOSE
                          Number                                                EXPENDED      EXPENDED
                                                                                  FY 06         FY 07
                                       To provide academic training and to
Rehabilitation                         increase the number of personnel
Long Term                84.129(Q)     trained in providing vocational
Training Grant                         rehabilitation services to individuals
                                       with disabilities.                         $135,438        $93,833
                                       To promote innovation and
Business and                           improvement in international
                                       business education curricula at
International
Education Projects
                         84.153(A)     institutions of higher education
                                       (IHEs) and promote linkages
Grant                                  between IHEs and the business
                                       community.                                   $6,971        $69,139
                                       To support projects that improve the
Training                               skills of manual, oral, and cued
Interpreters for         84.160(A)     speech interpreters providing
Individuals                            services to individuals who are deaf
                                       and individuals who are deaf-blind.        $204,674       $367,421
                                       To support scientifically rigorous
Research in                            research contributing to the solution
Special Education        84.324(C)     of specific early intervention and
Grant                                  education problems associated with
                                       children with disabilities.                      $0        $16,083

Personnel
Development to
Improve Services                       To ensure that those who work with
and Results for          84.325        children with disabilities have the
Children with            (A,D,K)       necessary skills and knowledge.
Disabilities Grant
                                                                                  $984,341     $1,146,126
National Institute                     To support and coordinate research
on Disability and        84.133        to improve the lives of people of all
Rehabilitation           (E,G)         ages with physical and mental
Research Grant                         disabilities.                               $963,519    $1,195,073
Sub-total                                                                        $2,294,943    $2,887,675
Total                                                                                          $5,182,618

The Department’s Office of Special Institutions, under the Office of Special Education and
Rehabilitative Services (OSERS), has oversight responsibility for GU. This office has
responsibility to monitor GU to ensure compliance with respective authorizing legislation, for
five of the six grants in the table above, and the EDA. Oversight responsibility for the Business
and International Education Projects grant is with the Department’s Office of Postsecondary
Education.



3
    Catalog of Federal Domestic Assistance.
Final Report
ED-OIG/A03I0009                                                                       Page 4 of 16



                                     AUDIT RESULTS




GU generally had adequate internal controls in place to account for Federal education funds; and
the expenditures charged to Federal education funds (excluding Title IV Federal student aid)
were reasonable, allocable, and allowable for the period October 1, 2005, through September 30,
2007. However, we found that GU had inadequately supported payroll costs during the audit
period for salaries paid by Federal grant funds. We also noted that GU needs to revise its
policies relating to record retention. In addition, we found that GU did not separately account for
expenditures made from appropriated funds (see Other Matters).

We provided GU with a draft of this report for review and comment on February 26, 2009. In its
response to the draft report, GU disagreed with Finding No. 1, however, it did take some
recommended corrective action. GU stated that the payroll costs were adequately supported for
the audit period and that the payroll system in place at the time met Federal requirements for an
after-the-fact payroll system. GU generally concurred with Finding No. 2 and plans to take
corrective action.

GU disagreed with our suggestion that appropriated funds should be accounted for separately
pointing out that it is not required by the EDA. However, GU stated that it is open to the
Department providing clarification on reporting requirements. GU also stated that it will
consider our suggestion to update its property management policy to provide protection for non-
capital items. GU generally agreed with our travel reimbursement suggestion, stating that it has
strengthened travel reimbursement controls. GU’s comments are summarized throughout the
audit report. Except for personally identifiable information, the entire narrative of GU’s
comments is included as Attachments A through I to this report, with the exception of a
document related to grant performance, which was too voluminous to include. A copy of this
attachment is available upon request.

Finding No. 1 – Grant Personnel Costs were not Adequately Supported

GU did not have adequate policies and procedures for verifying personnel costs charged
to Federal grant funds during the audit period. Specifically, GU did not have adequate activity
reports or a process in place to verify that the distribution of activity charges for services
performed by its employees on grant related activities were accurate during the audit period.
Therefore, there was no comparison made of: (a) the percentage of effort an employee actually
worked to (b) the percentage of grant funds actually paid. We determined that GU charged
$1,050,479 in inadequately supported salary and fringe benefits costs to grant funds during FYs
2006 and 2007.

GU informed us that during FYs 2006 and 2007, it used the “After-the-fact Activity Records”
payroll distribution system method. GU used Personnel Action Forms (PAF) to show the split
funding percentages to be paid from each funding source for those employees whose salaries
were funded by multiple sources. The PAF was not adequate as a time and effort certification
tool because it only showed the funding percentages to be charged to each funding source, and
Final Report
ED-OIG/A03I0009                                                                                        Page 5 of 16

not the percentage of effort worked. The PAF did not meet the requirements of Title 2 Code of
Federal Regulations (CFR), Part 2204, Appendix A (OMB Circular A-21). According to OMB
Circular A-21, Section J.10.c.(2)(b), “These reports will reflect an after-the-fact reporting of the
percentage distribution of activity of employees.” Additionally, OMB Circular A-21, Section
J.10.c.(2)(c) states that, “Reports will reasonably reflect the activities for which employees are
compensated by the institution. To confirm that the distribution of activity represents a
reasonable estimate of the work performed by the employee during the period, the reports will be
signed by the employee, principal investigator, or responsible official(s) using suitable means of
verification that the work was performed.” The PAF includes a before-the-fact estimate of
funding, based on the budget, not an after-the-fact reporting of the percentage of distribution of
activity. Use of the PAFs was not an adequate means of time and effort certification, and did not
provide adequate controls to ensure that grant funds were being used appropriately. It appeared
that GU believed that it was in compliance with the activity report requirement by use of the
PAFs.

GU also used bi-weekly time records (worksheets and e-timecards) during the audit period, as
allowed by Federal regulations. While the time records are after-the-fact, neither document
showed the percentage of effort. The time records only showed the total hours worked per day,
not per funding source. According to OMB Circular A-21, Section J.10.c.(2)(c), “The payroll
distribution system will allow confirmation of activity allocable to each sponsored agreement…”
which the time records did not. Further, the time records did not meet all of the requirements of
OMB Circular A-21, Sections J.10.c.(2)(a) through (f).

According to the Executive Director of Finance, the employee’s supervisor approved the
employee’s timesheet in GU’s timekeeping system, and when the supervisor (who approved the
employee’s PAF, which defined the expected split in effort for the employee’s salary costs)
signed the timesheet, it essentially re-approved the split funding that was in effect. This was not
an adequate form of time and effort verification. Although the grant principal investigators
reviewed salary charges to their sponsored agreements, reviewed the bi-weekly worksheets and
compared the worksheets to the PAF, this also was not an adequate effort verification process.

As stated, the time records did not show a distribution of the percentage of effort and therefore
only the hours worked were compared to the percentage of grant funds paid, not the distribution
of hours worked to what was charged to the grants. The percentage of funds to be paid may be
different than the percentage of effort budgeted or actually worked. The percentage shown on
the PAF is the percent of funding, which may not equate to the percent of effort. For example,
one employee was budgeted to work on a grant 20 percent of the time (effort) and 35 percent of
his salary was to be paid from grant funds. This information was reflected on his PAF; seven
percent of his salary was to be paid from the grant funds (20 percent multiplied by 35 percent).
Consequently, the PAF cannot be used as supporting documentation of employee effort.
According to OMB Circular A-21, Section J.10.c.(2)(c), a “…suitable means of verification that
the work was performed…” must be used to confirm that the distribution of activity allocated to
grant funds was reasonable. GU did not have a suitable means of verification.

4
 Cost Principles for Educational Institutions. The principles are applicable for grants, contracts and other
agreements with educational institutions.
Final Report
ED-OIG/A03I0009                                                                                        Page 6 of 16


As an example, we found that grant5 funds were overcharged for one employee (that was part-
time, 60 percent full time equivalent), whose salary was split funded between three funding
sources. For the pay period reviewed (pay date of July 17, 2007), ten percent of the employee’s
salary was to be paid from the grant funds.6 The employee worked 60 percent of a full time
work week of 40 hours or 24 hours per week (60 percent of 40). Since the employee was to give
10 percent of her effort to the grant, she would have worked 2.4 hours (10 percent of 24) per
week on grant activities.7 Therefore, ten percent (2.4 divided by 24) of her salary should have
been paid from grant funds. However, we found that 25 percent of the employee’s salary was
paid from grant funds. The employee was paid $441 (25 percent of the $1,765 total salary paid
for the pay period), instead of the $177 (10 percent of the $1,765) she should have been paid,
resulting in an overcharge to the grant of $2658 for the pay period. The PAF that covered this
pay period, which was effective October 1, 2006, indicated that 16.5 percent of the employees’
salary was to be charged to the grant funds, and showed 60 percent employee effort, which
would result in 10 percent (60 percent multiplied by 16.5 percent) of her salary being paid from
the grant funds.9

We reviewed the employee’s grant salary charges for the entire FY 2007, and found that the
employee’s salary was paid from grant funds at a rate of 25 percent for the entire year.10 The
employee’s PAF from an earlier period indicated that 25 percent of her salary (at 60 percent
effort) was to be paid from the grant funds. The Executive Director of Finance informed us that
due to a clerical error, the change in split was not updated in the bi-weekly payroll distribution
system. She further stated that the certifying supervisor did not initiate redistribution actions
since they thought the erroneously input data was correct and the difference in the amount was
not significant per pay period. However, this error would have been found if GU had an
adequate process in place to certify and verify personnel costs charged to the Federal grants (at
least every six months). Furthermore, since confirmations were not completed at least every six
months, this error was not caught during the fiscal year. Although PAFs may have been
prepared more frequently, they were mainly for salary adjustments and changes in work status,
and as stated above, the form did not indicate percentage of effort worked.




5
  The grant was the Rehabilitation Engineering Research Center on Hearing Enhancement grant.
6
  The grant budget indicated that the employee was to give 10 percent effort on grant activities (based on a full time
equivalent) and 10 percent of her salary was to be paid from grant funds. The employee was 60 percent of a full-
time equivalent employee.
7
  GU stated that the employee worked four hours per week on grant activities, and that the four hours worked would
have reflected the 10 percent effort (4/40) for a full-time FTE that was included in the grant budget. Therefore, GU
believes that 16.5 percent (4 hours/24 hours worked) of the employee’s salary should have been charged to the grant
(resulting in an 8.5 percent overcharge to the grant instead of the 15 percent noted in the finding). However, GU’s
payroll register for the two week pay period (and the entire year) showed that the employee worked 12 hours (25
percent of her time) on grant activities. We could not verify the number of hours worked by the employee because
GU did not have an adequate certification and verification process, as noted.
8
  The $265 figure was obtained by rounding up the difference of $441.36 - $176.54.
9
  This is calculated as follows: 16.5 percent of $1,765, which equates to $291.23; 60 percent of $291.23, which
equates to $175.
10
   This resulted in a total overcharge to the grant of $7,059 for the fiscal year.
Final Report 

ED-OIG/A03I0009                                                                                       Page 7 of 16 


Lack of sufficient time and effort certifications may result in inadequately supported or incorrect 

payroll, fringe benefits, and related indirect costs being charged to the grant funds. The 

verification and review of employees’ time and effort with the amounts paid from Federal grant 

funding would ensure that Federal grant funds were being spent appropriately. 

GU documented and implemented a new time and effort certification process in August 2008, 

which incorporated verification and confirmation procedures for employee effort. 11 However, 

GU did not have such a process during the audit period. 


Recommendation:

We recommend that the Chief Financial Officer and the Assistant Secretary for OSERS, in
collaboration with the Assistant Secretary for the Office of Postsecondary Education, require GU
to:

1.1		    Provide supporting documentation to verify that all split funded employees paid from all
         Department grant funds were paid in accordance with their actual effort, and return any
         overcharges to the Department or return to the Department the unsupported salary and
         fringe benefit costs ($1,050,479) for all split funded employees for the audit period.

GU’s Response:

GU disagreed with the finding. GU stated that it was in compliance with Federal regulations and
that the University had procedures and practices in place to substantiate personnel costs charged
to Federal and other grant funds during the FYs 2006 and 2007 audit period. Although GU
disagreed with the finding, University senior management created an action plan to provide
further management controls. GU asserted that the action plan will include:

        Effort training courses which will be mandatory for all faculty/staff who direct charge
         salaries on any sponsored projects;
      Reviewing all currently committed effort on all grants to ensure consistency with the
         labor distribution system;
      Reviewing the University effort policy to ensure that all the matters in the OIG report are
         addressed (and communicating any revisions to all university researchers);
      Reviewing of effort commitments by grant principal investigators in cases for which
         there is a change in faculty/staff appointment status;
     		 Emphasizing university policies and procedures and verification criteria, and requiring
         annual effort certification testing in major research departments by GU’s internal audit
         department, including report issuance to senior management; and
     		 Removing any agreed-upon excess salary from the Department grant for the example
         cited in the report.



11
  We reviewed the activity report and the verification process. Although we did not test this new policy to
determine its effectiveness of capturing employee time and effort, based upon our review, both the activity report
and the verification process appear to be adequate.
Final Report
ED-OIG/A03I0009                                                                         Page 8 of 16

GU also stated that in an effort to, “further show our commitment to ensuring full compliance,
the University has voluntarily recertified FYs 2006 and 2007 sponsored effort using the current
planned confirmation method.”

GU stated that the University’s Peoplesoft PAF embodied committed activity (effort) on grants
and its bi-weekly payroll system was used to certify actual payroll distribution. The PAF would
show a line by line payroll amount for each sponsored agreement and show the funding sources
for each employee. Supervisors used the PAF in conjunction with the time records for effort
certification, providing an after-the-fact confirmation of the effort expended. In combination,
these two sources showed a distribution of the percentage of salary and wages charged to the
grants. GU further stated that the work performed was verified by the employee, and principal
investigators or responsible officials during the bi-weekly payroll period. Supervisors also
reviewed the PAF against the bi-weekly payroll records. GU believes that this was a suitable
means of verification.

To further show that it had a suitable means of verification of effort, confirmation that the work
on the RERC grant (the main Department grant) was being performed, and that this process
represented an estimate of the work performed by employees, GU interviewed the Hearing,
Speech, and Language Sciences Department Chair who signed/certified the time and effort forms
for the RERC grant, as well as the other four Department grants under his department. The
Chair stated that he was aware of the work his faculty/staff were responsible for performing and
that the staff was carrying out their responsibilities. He also confirmed the usage of time records
and PAF records as substantiation. GU also interviewed the Principal Investigator (PI) over the
RERC grant. The PI stated that the work scope was being performed satisfactorily and that he
had documented such in his progress reports to Department program officers.

GU also stated that the one minor error identified in the report was the result of an erroneously
created labor distribution. GU believes that this is not indicative of a systemic problem with the
University’s payroll distribution and certification process, but instead it was one isolated clerical
error. The change in split was not updated in the payroll distribution system. The certifying
supervisors did not initiate redistribution actions since they thought the erroneously input data
were correct and the difference in the amount was not significant per pay period. GU stated that
its overcharge to the grant differs from the OIG questioned amount of $265 per pay period. GU
believes that there was an overage to the grant of 8.5% or $150 per pay period. However, GU
has transferred the OIG's calculated overcharge of $11,465 ($6,886 wages + $1,962 benefits +
$2,617 indirect costs) from the grant to a non-sponsored account.

Additionally, GU pointed out that OMB Circular A-21 “Acceptable Methods” requires
independent internal evaluations. GU believes that they met this standard since its internal audit
function conducted reviews of departments and their usage of the payroll system during the
period which cited no deficiencies. GU also asserted that during FYs 2006 and 2007, the
University was the subject of “single audit” reviews under OMB Circular A-133 by two separate
Certified Public Accounting firms (KPMG LLP and Grant Thornton LLP), but no deficiencies
were identified in this area during these audits.
Final Report
ED-OIG/A03I0009                                                                       Page 9 of 16

OIG’s Response:

Our finding remains unchanged. Based on the criteria cited in the report and the facts in the
finding, GU has not shown that during the audit period it had adequate policies and procedures
for verifying personnel costs charged to Federal grant funds in full compliance with OMB
Circular A-21, Section J.10. We commend GU for proactively recertifying the FYs 2006 and
2007 sponsored effort, however, this was done after the audit period and is not a suitable means
to show that GU’s process was adequate during the period. The proposed action plan, along with
GU’s revised time and effort policy, should improve GU’s payroll internal controls and assist in
ensuring compliance with the Federal requirements.

As stated in the finding, the PAF showed the percentage of funds to be charged to grant funds,
not the percent of effort worked. Furthermore, the bi-weekly payroll showed only the number of
hours worked per day and not the funding source or the percent of effort worked per funding
source. Comparing the time records with the PAF would only provide verification that the
employee worked during the pay period and that the correct percent of salary and wages were
charged to grant funds. This would not provide an adequate certification and verification of the
number of hours actually worked (effort) on the grant.

Determining whether the work performance under the grant was satisfactory was not in the scope
of our review, and the adequacy of the work was not specifically questioned by the OIG during
the audit. The finding does not state that work on the grants was not performed, nor is that the
issue. The issue, as stated, is that time and effort were not adequately certified and verified
according to Federal regulations.

OIG’s grant overcharge amount for the one employee differs from GU’s because GU could not
support that the employee worked 4 hours per week on the grant instead of the 2.4 hours (10
percent of 24 hours) that equates to the 10 percent effort the employee was to work on the grant.
If GU had an adequate time and effort certification process, the number of hours worked could
have been supported. We also disagree with GU’s assertion that this was a minor error and an
isolated incident. We cannot be sure that it was an isolated incident. The difference in the
percent of salary charged to the grant was either 8.5 or 25 percent, neither of which is minor. We
commend GU for transferring the grant funds overcharged for the employee into a non-
sponsored account; however, the example in the finding provides a basis to show that there could
be other examples of grant payroll cost inconsistencies. Therefore, as stated in the
recommendation, GU should retroactively review all Department grants to verify that all split
funded employees paid from grant funds were paid in accordance with their actual effort.

We acknowledge that there were no time and effort documentation deficiencies noted in GU’s
prior single audits and internal reviews. However, we do not know the extent of the audit work
performed by the accounting firms. Additionally, the internal reviews performed only included
three GU departments; just one of which had grant related expenditures. Although payroll was
reviewed for this department, it only consisted of a review of the bi-weekly payroll verification
worksheet to ensure that it was maintained, properly approved, and dated. As stated in the
finding, the worksheet showed only the total hours worked per day, not the percentage of effort
worked per funding source.
Final Report
ED-OIG/A03I0009                                                                                    Page 10 of 16

Finding 2 – Procurement Policies Need Revision and Updating

We found that GU’s procurement policy, dated October 15, 2004, and its Purchasing Card
Program Guide (the Guide), dated January 2003, were not in line with Federal regulations for
record retention. GU’s procurement policy did not address a record retention timeframe. The
policy only stated that, “Cardholders are required to maintain records and receipts of all
transactions.”

The procurement policy included purchase card usage standards (including requests, issuance,
spending limits, and purchase approval), which represented a significant portion of the policy.
The Guide further delineated the purchase card process and was therefore part of the policy for
procurement. The Guide instructed cardholders to only, “maintain their records for at least 24
months.” Education Department General Administrative Regulations (EDGAR), 34 CFR §
74.53 (b), Retention and Access Requirements for Records,12 requires, “Financial records,
supporting documents, statistical records, and all other records pertinent to an award shall be
retained for a period of three years.” In addition, GU's Agreement with the Secretary, Section
XIV, Records, A.3., states, “The University shall preserve and make available to the U.S.
Government all program and financial records for a period of three years from the date funds are
obligated by the University.” Furthermore, Federal regulations (34 CFR § 75.730, Records
Related to Grant Funds) and GU’s Agreement with the Secretary require GU to keep records to
show how funds were used and the total costs expended. If the records are not maintained for
the required period of time, GU may not have the required information available and be able to
meet these requirements. GU was not aware of the 3-year record retention requirement. GU’s
Procurement policy was last updated in April 2008, but it also did not include a timeline for
record retention.

We also found that the Guide indicated a lack of segregation of duties in approval of purchases
by unit administrators. Specifically, in the section that discussed the review of the monthly
purchase card statement, the Guide stated that, “Unit Administrators must do both [sic] Review
and Approve [for] each transaction[s] on their own card account.” This section also stated, “By
approving the statement, the unit administrator attests that the goods or services were received,
appropriate procedures were followed, and that appropriate documentation has been provided.”13
The Unit Administrator should not be doing all this for his/her own purchases. This directive did
not provide for adequate segregation of duties, as required by OMB Circular A-21, Section
C.4.d.(2), which states, “The institution’s financial management system shall ensure that no one
person has complete control over all aspects of a financial transaction.” The directive essentially
provided one individual with responsibility for the approval of the purchase, the process used,
and how the funds would be accounted for. Although, in practice, GU did require supervisor
approval for all purchase card transactions; the Guide did not indicate it was required for Unit
Administrator purchases.




12
   Administration of Grants and Agreements with Institutions of Higher Education, Hospitals, and other Non-Profit 

Organizations.


13
   GU’s procurement policy also stated this. 

Final Report
ED-OIG/A03I0009                                                                       Page 11 of 16

The Guide has not been updated since 2003. However, GU has informed us that it is in the
process of revising the policies and procedures relating to the purchase card program as well as
GU’s document retention policy.

Recommendations:

We recommend that the Chief Financial Officer and the Assistant Secretary for OSERS require
GU to:

2.1 	   Review its policies and procedures and update any requirements regarding record
        retention to ensure supporting documentation is retained for a period of at least three
        years; and

2.2 	   Revise its policies to reflect current processes and approval requirements.

GU’s Response:

GU agreed with the need to revise its procurement policies. However, GU noted that the Board
procurement policy, which was silent on a retention period, is its governing policy, not the
Purchase Card Program Guide. Furthermore, GU disagreed with the lack of segregation of
duties portion of the finding and pointed out that “the lack of segregation of duties is a perceived
deficiency in a user guide, rather than a deficiency in a policy, process or actual practice.” GU
believes it has appropriate controls in place to meet the requirement of OMB Circular A-21,
Section C.4.d.2. GU also stated that policies related to the purchase card program and record
retention are being revised.

OIG’s Response:

Although the Board procurement policy is GU’s governing policy, purchase card usage is a part
of that policy, and therefore the Guide, which provides guidance on purchase card usage, is a
part of the governing procurement policy. In its current state, the Guide may be misleading to
new purchase card users and therefore should be revised to accurately state GU’s current policy.
GU’s planned corrective action should address our recommendations.




                                     OTHER MATTERS 



Accounting for the Federal Appropriation

GU did not maintain separate books, records, and documents for the receipt and expenditure of
Federally appropriated funds for the period October 1, 2005, through September 30, 2007. GU
pooled appropriated funds with other revenue sources to fund the general operations of the
University and Clerc Center. Consequently, GU could not provide the universe of transactions
expended from its appropriated Federal funds during our audit period.
Final Report
ED-OIG/A03I0009                                                                      Page 12 of 16


GU used accounts for departments funded by non-Federal sources (non-discretionary
departments) for expenditures deemed unallowable per the EDA. GU’s independent public
accountant (IPA) was also aware that GU did not break down the costs for the Federal
appropriation. In order to test EDA compliance for its audit, whether the expenditure was
unallowable per the EDA, the IPA verified that the expenditure was charged to a non-
discretionary department account.

For FY 2006, general operating expenditures accounted for $125,494,341 (81 percent) of GU’s
$154,261,580 total expenditures. For FY 2007, general operating expenses were $112,297,278
of the $158,529,606 (71 percent) total expenditures.

Although we identified no instances of unallowable items being charged to Federally funded
general operating accounts during our audit period, we do not consider GU’s method of
accounting for the appropriation to sufficiently meet the minimum cost accounting requirements
attached to most Federal awards. Furthermore, GU’s Agreement with the Secretary for the
operation of the Clerc Center indicates that appropriated funds should be accounted for
separately. Part XIV (A)(1) of the Agreement states, “[GU] shall maintain separate books,
records, documents, and other evidence pertaining to its educational programs and activities and
its administrative operations, including documentation of costs and expenses in carrying out this
Agreement (herein collectively called ‘program and financial records’). Additionally, Part XVI
(C) of the Agreement stated, “… [GU] shall apply the same policies that it applies to its other
operations, including but not limited to fiscal management.” Finally, Part XIX (B) of the
Agreement stated, “[GU] shall account for the sum total of all amounts paid to the University….
Upon request, [GU] shall make available relevant records or other evidence, satisfactory to the
Secretary, of expenditures of allowable costs.”

The OIG recognizes the lack of criteria for how to account for appropriated funds and is
addressing this issue with the Department. Although there is no Agreement specifically
pertaining to the operations of the University, sufficient criteria exists demonstrating the
expectation that appropriated funds should be accounted for separately. The ability to track
program related revenues and expenditures and assess program effectiveness are fundamental
requirements of most Federal awards.

We suggest that the Assistant Secretary for OSERS work with GU to establish appropriate
accounting records for appropriated funds and to close out the records when all Federal funds are
exhausted.

GU’s Response:

GU disagreed with our suggested change to its method of accounting for federally appropriated
funds, stating that “the EDA defines its own compliance and reporting requirements, with which
we comply.” GU also noted that it complies with the additional reporting requirements for the
Clerc Center, as defined in its agreement with the Secretary. GU further stated that it takes great
care in exercising its fiduciary duty to manage Federal funds, noting that its Budget
Responsibility Policy provides examples of unallowable costs. GU pointed out that general
expenses exceeded Federal funding during FYs 2006 and 2007. Furthermore, GU noted that
Final Report
ED-OIG/A03I0009                                                                                          Page 13 of 16

OMB Circular A-133 audits performed over the last 5 years, by two separate accounting firms
noted no deficiencies in this area. GU is open to clarifying reporting requirements with the
Department.

OIG’s Response:

We reiterate our suggestion that the Assistant Secretary for OSERS work with GU to establish
appropriate accounting records for appropriated funds and to close out the records when all
Federal funds are exhausted, as this is the standard required for most Federal awards.

Non-Capital Equipment

GU's property management policy provided that items with a unit cost of $5,000 or more and a
useful life of at least five years are inventoried. GU's policy was consistent with OMB Circular
A-21, Section J.18., which does not require expendable items (those with a purchase price of less
than $5,000 and a useful life of less than five years) to be inventoried and tracked. However,
many highly pilferable items have a purchase price of less than $5,000 and a useful life of less
than five years. For example, our review of expenditures paid with appropriated funds included
two computers purchased at a cost of approximately $2,300 each.

We suggest GU consider revising its property management policy to provide protection for
computers and other lower-priced equipment purchased with Federal funds.

GU’s Response:

GU noted that its property management policy is in line with Federal requirements but stated it
will consider revising the policy to develop additional procedures to safeguard against the
misappropriation or theft of such equipment.

Reimbursement of Travel Expenditures

We reviewed eight travel vouchers and noted two instances where employees were not
reimbursed in accordance with GU’s policy for allowable travel expenditures. One employee
was reimbursed at a per diem rate above GU’s allowable rate,14 was reimbursed per diem for
two days of travel that was not taken and was also reimbursed for more per diem than she was
entitled to for one day. Another employee was improperly reimbursed per diem for the cost of
lunch that was included as a part of the training he attended. We also noted that two travel
vouchers were not submitted within policy guidelines.

Policies and procedures are a means of internal control and should be followed to ensure proper
use of Federal funds. Properly implemented controls provide reasonable assurance that only
appropriate transactions are authorized, executed and recorded and any errors are detected

14
   GU stated that the employee used the Federal per diem rate, and that during the time of travel its travel policy was
silent on whether an employee could follow the federal per diem rate when it was in excess of the University’s
stated rate. GU revised its travel policy to state that travel being funded by a federal grant will be eligible for the per
diem allowance established by the University.
Final Report
ED-OIG/A03I0009                                                                          Page 14 of 16

timely. We suggest that GU take steps to ensure adherence to its policies and procedures for
reimbursement of travel expenses to avoid reimbursement of unallowable expenses.
GU has provided us with assurance that it is taking steps to strengthen controls around the
process of reimbursing employees for travel related expenditures.

GU’s Response:

GU generally concurred with the discrepancies in travel reimbursement costs that we identified.
However, it disagreed that the $64 per diem rate paid to one employee was not allowable stating
that the use of the Federal per diem rate was allowable under the grant. GU believes there was
no overpayment of Federal grant funds. GU stated that it has strengthened controls, including a
more thorough review of travel reimbursement forms prior to reimbursement.

OIG’s Response:

The OIG reiterates that GU’s per diem rate should have been used for the trip in question. OMB
Circular A-21, Section J.53.b. states, “Costs incurred by employees and officers for travel,
including costs of lodging, other subsistence, and incidental expenses, shall be considered
reasonable and allowable only to the extent such costs do not exceed charges normally allowed
by the institution in its regular operations as the result of the institution's written travel policy.”
GU did not provide supporting documentation to show that the expenditure in question was
exempt from this criteria.



                  OBJECTIVES, SCOPE, AND METHODOLOGY 



Our audit objectives were to determine if GU had adequate internal controls in place to account
for Federal grant funds, and to review expenditures charged to Federal education funds,
excluding Title IV Federal student aid, for the period October 1, 2005, through September 30,
2007, to determine if expenses charged were reasonable, allocable, and allowable.

To accomplish our objectives, we reviewed relevant criteria, background information about GU,
and reviewed OMB Circular A-133 audit reports for FYs 2004-2006, and GU’s internal audit
reports conducted in FY 2007. We also reviewed reports from monitoring visits conducted by
OSERS during our audit period, and an Office of Inspector General FY 2007 audit report
conducted on GU’s Title IV program. We interviewed GU administrative staff and personnel
about processes related to the scope of our audit and reviewed related policies and procedures,
and other documents. In addition, we sampled and tested expenditures paid with non-Title IV
Federal funds for compliance with GU’s policies and procedures and with Federal regulations.

To test expenditures, we obtained a universe, for each fiscal year, of (1) expenditures charged to
general operations, and (2) expenditures charged to non-Title IV Federal grants. We randomly
and judgmentally sampled expenditures to determine whether the selected expenditures were
reasonable, allocable, and allowable for the audit period. Judgmental sampling was used for
Final Report
ED-OIG/A03I0009                                                                                Page 15 of 16

general ledger accounts most appropriate to the types of expenditures that are unallowable per
the EDA.

In total, we sampled 231 transactions totaling $391,602 (this amount includes three adjusting
journal entries totaling negative $114,000 in the FY 07 Appropriation sample) as follows:


           Population       Universe        Universe           Type of          Sample     Sample
                            Number          Amount             Expense         Number of   Amount
                            of Items                                             Items
                                                              Non-payroll          25        $84,077
         Grants FY 06            2,569       $2,294,943
                                                               Payroll15           10         $2,772
                                                              Non-payroll          37       $167,549
         Grants FY 07            3,184       $2,887,675
                                                                Payroll            10         $3,015
           Sub-total             5,753       $5,182,618                            82       $257,413

                                                              Non-payroll           67       $76,874
         Approp FY 06         139,382      $125,494,341
                                                                Payroll             10       $15,320
                                                              Non-payroll           62       $31,695
         Approp FY 07         127,330      $112,297,278
                                                                Payroll             10       $10,300
           Sub-total          266,712      $237,791,619                             149     $134,189

             Totals           272,465      $242,974,237                             231     $391,602

To achieve our audit objectives, we relied on computer-generated data from GU’s PeopleSoft
financial database. We tested the completeness of GU’s expenditure data by tying back to GU’s
audited financial statements. We verified the authenticity of computer-generated documents by
comparing them to source documents. Based on the comparisons, we concluded that the
computer-generated data was sufficiently reliable for the purpose of our audit.

We performed our fieldwork at GU’s location in Washington, D.C., in March through May 2008.
We held an exit conference with GU officials on February 19, 2009. We conducted this
performance audit in accordance with generally accepted government auditing standards. Those
standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to
provide a reasonable basis for our findings and conclusions based on our audit objectives. We
believe that the evidence obtained provides a reasonable basis for our findings and conclusions
based on our audit objectives.



                                    ADMINISTRATIVE MATTERS




Statements that managerial practices need improvements, as well as other conclusions and
recommendations in this report, represent the opinions of the Office of the Inspector General.
Determinations of corrective action to be taken will be made by the appropriate Department of
Education officials.

15
     Our review of payroll expenditures included salary and fringe benefit costs.
Final Report
ED-OIG/A03I0009                                                                     Page 16 of 16

If you have any comments or information that you believe may have a bearing on the resolution
of this audit, you should send them directly to the following Education Department officials, who
will consider them before taking final Departmental action on this audit:

               Thomas Skelly
               Acting Chief Financial Officer, Office of the Chief Financial Officer
               U.S. Department of Education 

               400 Maryland Avenue, SW 

               Washington, D.C. 20202 


               Andrew J. Pepin
               Executive Administrator
               Delegated the Authority to Perform
               the Functions and Duties of the
               Assistant Secretary, Office of Special Education and Rehabilitative Services
               U.S. Department of Education 

               400 Maryland Avenue, SW 

               Washington, D.C. 20202 


               Daniel T. Madzelan
               Delegated the Authority to Perform
               the Functions and Duties of the
               Assistant Secretary, Office of Postsecondary Education
               U.S. Department of Education 

               400 Maryland Avenue, SW 

               Washington, D.C. 20202 


It is the policy of the U.S. Department of Education to expedite the resolution of audits by
initiating timely action on the findings and recommendations contained therein. Therefore,
receipt of your comments within 30 days would be appreciated.

In accordance with the Freedom of Information Act (5 USC § 552), reports issued by the Office
of Inspector General are available to members of the press and general public to the extent
information contained therein is not subject to exemptions in the Act.

                                             Sincerely,

                                             /s/
                                             Bernard Tadley
                                             Regional Inspector General for Audit


Attachments
Gallaudet University’s Internal Controls
Over Federal Funds                                                                          Control Number ED-OIG/A03I0009




      =========~=========
               W
        GALLAUDET

       OFFICE OF THE PRESIDENT
                                                                                UNIVERSITY

                                                                                                            KENDALL GREEN
       (202) 651-5005                                                                                800 FWRIDAAVENUE, NE
       (202) 651-5508 (FAX)                                                                       WASHINGTON, DC 20002-3695




                March 19,2009



                Bernard Tadley
                Regional Inspector General for Audit
                Office of Inspector General
                United States Department of Education
                The Wanamaker Building
                100 Penn Square East, Suite 502
                Philadelphia, PA 19107

                Re: Response to the Draft Report of Gallaudet University's Internal Control Over
                Federal Education Fnnds Audit (ED-OIG/A03IO009)

                Dear Mr. Tadley:

                Please find enclosed our detailed responses, with supporting documentation, to the U.S.
                Department of Education, Office of the Inspector General's (OIG) report of findings
                dated February 26, 2009 relating to the audit entitled Gallaudet University's Internal
                Control Over Federal Funds which covered fiscal years 2006 and 2007. We respectfully
                request that the University's written responses on the reported fmdings and
                recommendations are noted and considered in the final report and subsequent program
                determinations.

                We appreciate the Office of the Inspector General's recognition that the University "had
                adequate internal controls in place to account for federal education funds, and the
                expenditures charged to federal education funds (excluding Title IV federal student aid)
                were reasonable, allocable, and allowable." The University takes great pride in
                exercising our fiduciary duty to prudently manage our appropriated federal funds and our
                sponsored grant awards. We also recognize and take great care to ensure full compliance
                with all appropriate governing legislation and regulations.

                We are most surprised by the inclusion of $lM of questioned costs referenced in Finding
                No.1 as we strongly believe that our processes relating to payroll distribution and
                verification were in compliance with all federal regulations including OMB Circular A-
                21 Section J1 O. In our response, we include a detailed analysis of how the University
                complied with all aspects of the requirements ofOMB Circular A-21 Section no. Vlhile
                the University finnly disagrees with the OIG's position, we have already voluntarily and
                proactively recertified fiscal 2006 and 2007 sponsored effort. Furthennore, we had




                                                                 Attachment A  ­ Page 1

    
Gallaudet University’s Internal Controls
Over Federal Funds                                                                          Control Number ED-OIG/A03I0009




               already augmented our policies and procedures in this area during fiscal 2008. The OrG
               explicitly noted in their draft report that this improved method appeared adequate. In
               addition, this position has been confinned by our external auditors during our fiscal 2008
               OMB Circular A-133 single audit review. Thus, while we disagree that our persormel
               costs were not adequately documented in fiscal 2006 and 2007, our revised process has
               received independent verification that it is operating effectively and well documented.
               We believe this issue has been resolved.

                The University appreciates the observations of the OrG in helping fine tillle policies and
                procedures already in place to ensure continued compliance. Below are our detailed
                responses to the preliminary findings and recommendations noted in audit report.


                Sincerely,



                Robert R. Davila
                President

                cc:                                  I' resident, Administration and Finance, Gal1audet Cniversity

                                                     ,.cutive Director, Finance, Gallaudet University
                                                        epartment of Education, Office of Inspector General
                                                        .S. Department of Education, Office of Inspector General
                                                      • epartment of Education, Office of Inspector General




                                                                 Attachment A  ­ Page 2

     
Gallaudet University’s Internal Controls
Over Federal Funds                                                                             Control Number ED-OIG/A03I0009




                                                      University Response to Findings


                Response to Finding No.1                         Personnel Costs were not Adequately Supported

                Summary

                Gal1audet University (the University) disagrees that we were not in full compliance with OMB
                Circular A~21 (A -21), section J1 0 for appropriate record keeping on federal grant personnel costs.
                In the period under review, the University had adequate procedures and practices in place to
                substantiate personnel costs charged to federal grant funds. The University followed the method
                defmed in A-21 as "After-the-fact Activity Records."

                While the University disagrees our prior method did not fully comply, during 2008 the University
                improved its system by moving to the more traditionally used A-21 "Plan Confirmation" method
                to augment controls as well as policies and procedures. This new method was noted by the Office
                of the Inspector General (OIG) as appearing satisfactory and was tested in detail during our fiscal
                2008 OMB Circular A-133 "Single Audit" review by our Certified Public Accounting firm. No
                OMB Circular A-21 issues were noted in this OMB Circular A-133 review. To further show our
                commitment to ensuring full compliance, the University has voluntarily recertified fiscal 2006
                and 2007 sponsored effort using the current planned confirmation method and created an action
                plan to ensure future effort certifications remain in compliance. We are confident this
                documentation issue has been resolved.

                The OIG identified one minor example where a portion of an employee's payroll was improperly
                charged to the grant. This instance involved an unusually complex situation where the original
                budget proposed the employee's effort on a full-time equivalent; however, the employee
                subsequently became a 60% appointment. As a result of a clerical error, the labor distribution for
                this employee was created erroneously. This is not indicative of a systemic problem with the
                University'S process; instead it was one isolated clerical error. Our calculation of the overage
                differs from the OIG's cited $265 per pay period; however we have transferred the OIG's
                questioned amount from the grant to a non-Spbnsored account.

                We provide below a detailed response to the Report citations in Finding No.1.

                 University Procedures and Practices in Place

                In compliance with federal regulations, the University had procedures and practices in place to
                substantiate personnel costs charged to federal and other grant funds during the fiscal year 2006
                and 2007 audit period. These encompassed proper means to certify the activities of employees
                whose salaries were funded by multiple sources and that the work was performed. Also, the
                process verified that the distribution of activity charges for services performed by employees was
                accurate. Therefore, the University method in place at that time of using the combination of
                Personnel Action Forms (PAF) and bi-weekly.Payroll records met federal requirements as an
                adequate means of time and effort certification:

                 During the fiscal year 2006 and 2007 period, the University complied with o:rvm Circular A-21
                 by using the "After-the-fact Activity Records" method (section nOe2). Specifically, the
                 University employed its bi-weekly time records, as allowed by federal regulations (section
                 nOe2!):


                                                                           30flO




                                                                  Attachment A  ­ Page 3

      
Gallaudet University’s Internal Controls
Over Federal Funds                                                                          Control Number ED-OIG/A03I0009




                      "Where the institution uses time cards or other forms of after-the-fact payroll
                      documents as original documentation for the payroll and payroll charges, such
                      documents shall qualif; as records for th,is purpose, provided that they meet the
                      requirements in subsections Jl0c2a through Jl0c2e. "

                We provide below a description of how the University Payroll Distribution system ("Effort
                Certification") specifically met the requirements in the cited "a" through "e" subsections.

                As required by subsection "a", the University system properly reflected the distribution of activity
                expended by employees covered by the system. Specifically, the University Peoplesoft Personnel
                Action Fonn (PAP) embodied committed activity ("effort") on grants and all other activities and
                the University bi-weekly Payroll system was used to certify actual payroll distribution, or to
                identify any necessary changes to employee activities.

                To comply with subsection "bOO, the University reports reflected an after-the-fact reporting of the
                percentage of distribution of activity of employees. As previously stated, the University
                Peoplesoft Personnel Action Form (PAF) embOdied committed activity ("effort") on grants and
                all other activities. The OIG report states that the "PAF is a before-the-fact estimate offunding.
                based on the budget." However, we need to clarify that the PAF is the source document input to
                the University Labor Distribution system. Therefore, this would show a line-by-line payroll
                amount for each sponsored agreement and non-sponsored account from which employees were
                paid during any given effort certification cycle. In turn, the PAF would show the funding sources
                for each employee. Supervisors used the PAF in conjunction with time records for effort
                certification purposes providing for an after-the-fact confirmation of the effort expended. In
                combination, these two sources showed a distribution of the percentage of salary and wages
                charged to sponsored agreements; and, these two were utilized during the effort certification
                process.

                Also, for subsection "b", the University's proc~ss involved charges made initially on estimates
                made before services were performed, and the prompt adjustment of charges if significant
                differences were identified. For changes, the policy and procedures were for supervisors to
                review the PAP against bi-weekly payroll and, as necessary, contact the payroll department to
                request a change in payroll distribution. Also, grant principal investigators reviewed salary
                charges to their s]X'll1sored agreements and also initiated any necessary payroll distribution
                changes.

                In tenns of subsection "c", the University's procedures included reports that reasonably reflected
                activities for which employees were compensated and confirmed that the work was performed
                during the bi-weekly pa}Toll period. This verification was petfonned by employees, principal
                investigators or responsible official(s) with a suitable means of verification. Specifically,
                supervisors with direct first-hand knowledge of employee activities reviewed PAF documents
                against bi-weekly payroll records. For necessky changes, supervisors contacted the payroll
                department to request a change in distribution.

                 The University also met subsection "d" requirements that the system reflect activity applicable to
                 each sponsored agreement and to each category needed to identify F &A costs and associated
                 functions. In this case, the PAF and bi-weekly payroll reports included all accounts and,
                 therefore, activities.




                                                                         4oflO



                                                                 Attachment A  ­ Page 4

    
Gallaudet University’s Internal Controls
Over Federal Funds                                                                          Control Number ED-OIG/A03I0009




                Finally, for subsection "e", the University's bi-weekly system exceeded the requirement that, for
                professorial and professional staff, activity reports should be prepared each academic term, but no
                less frequently than every six months. For other employees this requirement is no less frequently
                than monthly.

                For clarification, we include Attachment I showing specifically how the University system in
                place during 2006 and 2007 met all required federal standards. Additionally, this delineates how
                the institutional practices meet the A-21 "Criteria for Acceptable Methods" (A-21, section
                nOb1).

                Of special note, the A-21 "Acceptable Methods" requires independent internal evaluations. The
                University met this standard since its Internal Audit function conducted reviews of departments
                and their usage ofthe payroll system during the period. The University furnished Office of
                Inspector General (OIG) staff with copies of these reports, which cited no deficiencies.

                Additionally, during fiscal year 2006 and 2007 the University was the subject of "Single Audit"
                reviews under OMB A-133 by two separate Certified Public Accounting firms (KPMG LLP and
                Grant Thomton LLP), but no deficiencies were identified in this area during these audits.

                Compliant Certification Procedures in Place

                We interviewed the Hearing, Speech, and Language Sciences Department (HSLS) Chair who
                signed/certified the time and effort forms for the main U.S. Department of Education grant
                Rehabilitation Engineering Research Center on Hearing Enhancement (RERC) as well as the
                other four U.S. Department of Education grants under his department. These five grants
                represent approximately $950,000 of our $1.4 million of total grant payroll for the fiscal years
                2006 and 2007.

                The chair advised us that he was aware of the work his faculty/staff were responsible for
                perfonning and that they were carrying out their responsibilities. The chair confinned his
                understanding of the effect of his signature on the P AF and the timesheets in tenus of the A-21
                requirement. Also, he confirmed the usage of time records and PAF records as substantiation.
                The chair also confirmed that the procedure for reflecting revised effort distribution is the
                generation of a new P AF, and if the P AF was retroactive a cost transfer would be processed to
                adjust the charges to ensure consistency with the P AF. It should be noted that this is a small
                department of approximately 12 researchers in which the Chair knew what his staff and faculty
                were working on and the project results.

                Therefore, a responsible and knowledgeable official with suitable means of verification was
                confirming that the work on this main grant was performed and that this process represented an
                estimate of the work perfonned by employees.

                Satisfactory Performance of Scientific Work Scope

                We also interviewed the Principal Investigator',cPI) over the RERC grant and inquired about the
                performance of work on this grant.

                The PI advised us that the work scope was being performed satisfactorily and that he had
                documented such in his Progress Reports to U.S. Department of Education Program officers. For
                example, we include here the Progress Report for the RERC for the time period 06101106 to
                05/31107 (Attachment II), The PI provided email documentation that the Program officer


                                                                        5 of 10



                                                                 Attachment A  ­ Page 5

    
Gallaudet University’s Internal Controls
Over Federal Funds                                                                          Control Number ED-OIG/A03I0009




             reviewed his report (Attachment III). Also, the USDE Program Officer issued a subsequent year
             award following the submission of the annual Progress Report indicating that the Program Office
             was satisfied with the work performed.

             It is our understanding that subsequent renewal awards in the same area are also considered a
             reflection of the institution and project director's satisfactory performance of scientific work. In
             September 2008, the RERC project was awarded another five year U. S. Department of Education
             award totaling $4.7 million (Attachment N). Also, attached is a list of awards issued to the
             project director during and subsequent to the audit period which reflect that the project director's
             programmatic performance met all expectations and contributed to the advancement of
             understanding within the field (Attachment V).

             Additional Example Added within Revised GIG Draft Report

             The report notes a second example for one employee with "20 percent effort and 35 percent
             salary."

             We greatly appreciate your considering our response, detailing our reviews of propos aliaward
             documents, the notice of award and associated time & effort reports. We appreciate your
             February 6, 2009 correspondence clarifying that this does not reflect an issue/finding.

             Single Identified Deficiency Case

             The OIG report did identify one example for which an employee had not charged a grant
             properly. However, this involved a complex condition in which the federal sponsor request of
             proposal cited the need for an activity/effort commitment on a full-time equivalent (FTE) basis
             rather than the standard person-months or effort percent basis. Further complicating this matter,
             the employee was on a sixty percent (60%) appointment.

             As a result of a clerical error, the labor distribution for this employee was created erroneously.
             However, this is not indicative of a systemic problem with the University's payroll distribution
             and certification process, which met all A-21 requirements as demonstrated above.

             While the University PAF was properly completed, the change in split was not updated in the bi­
             weekly payroll distribution system. The certifying supervisors did not initiate redistribution
             actions since they thought the erroneously input data was correct and the difference in the amount
             was not significant per pay period.

             Also, our calculations (Attachment VI) show an overcharge amount which differs from the OIG
             cited amount of $265 per pay period. As stated above, the proposal cited the activity/effort on a
             FTE basis which was 10%. The employee was a 60% appointment and thus the activity/effort
             basis needed to be adjusted to 16.5%. According to the grant Primary Investigator, the employee
             owed the grant 10% FTE but worked a 60% or 24 hour week appointment. That would translate
             into 4 hours per week (10% of 40 hours is 4 hours) and 16.5% (4 hours/24 hours). The grant
             should have been charged 16.5% or $291 per pay period but due to the clerical error the prior
             split of25% or $441 was not updated. The overage to the g'rant was 8.5% or $150 per pay period.
             White we disagree with the higher amount cited by the OIG, we have transferred the OIG's
             calculated overcharge of $11,465 ($6,886 wages + $1,962 benefits + $2,617 indirect costs) from
             the grant to a non-sponsored account.




                                                                      6oflO



                                                                 Attachment A  ­ Page 6

    
Gallaudet University’s Internal Controls
Over Federal Funds                                                                             Control Number ED-OIG/A03I0009




                 University Action Plan

                 The University Effort Certification process met federal regulations during the fiscal 2006 and
                 2007 period. As we have discussed with OIG staff, the University improved its system during
                 2008 by moving to the OMB A-21 "Plan Confirmation" method to augment controls as well as
                 policies and procedures over salary and wages charged to sponsored agreements.

                 We appreciate the report footnote # 11 noting that our "Plan Confirmation" method appears
                 adequate. During our fiscal 2008 annual OMB Circular A-133 review, our Certified Public
                 Accounting firm specifically performed detailed test work on our Effort Certification process and
                 noted no issues.

                 We also appreciate and share the OIG's position that Effort Certification is mandatory and of the
                 highest priority. University senior management fully recognizes the importance of full
                 compliance with federal requirements over sponsored agreements.

                 While we disagree the University was not in full compliance with OMB A-21, we have prepared
                 and recertified fiscal 2006 and 2007 effort using the planned confirmation method for the five
                 HSLS grants which total approximately $950,000 of payroll costs. The reports have been
                 reviewed and signed by a responsible official with suitable means ofverificatioll. The reports
                 contain sensitive information and will thus be available upon request.

                 Additionally, University senior management will implement the following Action Plan and steps
                 as further management controls:

                     •      Conducting further Effort Training courses which will be mandatory for all faculty/staff,
                            who direct charge salaries on any sponsored projects
                     •      Emphasizing with certifying faculty/staff the A-21 requirements, University
                            policies/procedures and criteria for suitable means of verification
                     •      Reviewing all currently committed Effort on all grants to ensure consistency with the
                            labor distribution system
                     •      Reviewing the University Effort Policy to ensure all the matters in the OIG report are
                            addressed and communicating any policy revisions to all university researchers
                     •      Requiring that the University Internal Audit department conducts annual Effort
                            Certification testing in the major research departments, including report issuance to
                            senior management
                     •      Creating a control mechanism by which effort commitments are reviewed by grant
                            principle investigators in cases for which there is a change in faculty/staff appointment
                            status
                     •      Removing any agreed-upon excess salary from the U.S. Department of Education grant
                            for the one example cited above




                                                                            70flO



                                                                    Attachment A  ­ Page 7

    
Gallaudet University’s Internal Controls
Over Federal Funds                                                                            Control Number ED-OIG/A03I0009




                Response to Finding No.2 - Procurement Policies Need Revision and Updating

                Summary

                The University agrees with the need to revise our procurement documentation; however, we
                disagree with the lack of segregation of duties portion of this finding. Since the time under audit,
                we have updated our procurement documentation. Our responses to each of the issues are
                summarized below:

                Retention Period for the Purchase Card Program

                Although the Purchase Card Program Guide (Guide) summarizes procedures to be followed by
                cardholders specific to the Purchasing Card PrQgram, the Guide is not our governing policy. Our
                governing policy is the Board Procurement Policy (see Attachment VII), which is silent on a
                retention period but states that cardholders are required to maintain records and itemized receipts
                of all transactions.

                Furthermore, as evidenced by the results of the audit, documentation is maintained in excess of
                the 24-month period referenced in the Guide. The OIG only found one instance in which we
                were unable to provide documentation for a purchase of approximately $300. We are currently
                revising our policies and procedures relating to the Purchase Card Program and our document
                retention policy.

                Segregation of Duties in Approval ofPurchases by Unit Administrators

                                                                          it.
                This finding relates to a perceived deficiency a user guide, rather than a deficiency in a policy,
                process or actual practice. Although the Guide states that the "Unit Administrators must both
                Review and Approve each transaction on their own card account" this only refers to the review of
                Purchase Card Program transactions through a third party system. Varieus other preventative and
                detective controls exist prior to purchases being posted to the general ledger. Examples of these
                controls include:

                    •     Each cardholder, including the Unit Administrators, has spending limits assigned to
                          his/her card in accordance with each individual's signature authority.
                    •     A supervisor, as well as the cardholder, is notified by email when activity is pested to the
                          cardholder's account.
                    •     The cardholder and supervisor can review activity online throughout the month.
                    •     At month end, paper statements are seJ}t to the departments detailing each transaction.
                    •     All transactions are subject to review by the Contracts & Purchasing department on a
                          monthly basis prior to transactions being posted to the general ledger.

                In addition, various analytical procedures are perfonned by the Finance department subsequent to
                transactions being posted to the general ledger.

                As these controls are established and executed among a variety of individuals and departments,
                the University has appropriate controls in place to meet the requirement per 0113 Circular A-21,
                CA.d. that an "institution's financial management system shall ensure that no one person has
                complete control over all aspects of a financial transaction."




                                                                          80f10



                                                                   Attachment A  ­ Page 8

    
Gallaudet University’s Internal Controls
Over Federal Funds                                                                            Control Number ED-OIG/A03I0009




                Response to Other Matters:

                Accounting tOr the Federal Appropriation'

                The OIG's report states that they do not believe that the University's method of accounting for
                the appropriation sufficiently meets the minimum cost accolmting requirements attached to most
                federal awards. Unlike federal grants, the federal appropriation is a direct appropriation from the
                u.s. Congress under the authority ofthe Education of the Deaf Act (EDA). The EDA defines its
                own compliance and reporting requirements with which we comply.

                \Vhile there is no requirement per the EDA for the University to separately track revenues and
                related expenses for Federally appropriated funds, we take great care in exercising our fiduciary
                duty to prudently manage such funds. During both fiscal years 2006 and 2007, our general
                expenses exceeded the Federally appropriated funds. To foster a culture of awareness, the Board
                Budget Responsibility Policy (Attachment VIII) is available online and lists examples of
                unallowable costs. We also provide trainmg to all our budget unit heads and support staff to set
                expectations for managing their budget in accordance with University priorities and the EDA. In
                addition, we have implemented appropriate controls to monitor and track unallowable costs,
                which include establishing a specific department within each division to charge any such costs.

                By agreement with the Department of Education liaison, our external auditors annually perform
                additional agreed upon procedures to ensure compliance with the EDA. Over the past five years,
                the University was the subject of "Single Audit" reviews lmder OMB Circular A-133 by two
                separate Certified Public Accounting firms (KPMG LLP and Grant Thornton LLP), but no
                deficiencies have been noted in this area.

                We recognize that additional reporting requiretp.ents exist for the operation of the Clerc Center in
                compliance with the University's agreement with the Department of Educatioo. We believe that
                we comply with these additional requirements and have worked with the Department of
                Education to develop appropriate reporting processes. These processes are also reviewed
                annually during our Ol'v1B A-133 audit with no deficiencies noted, These processes include:

                    •     Expenses allocated directly to the Clerc Center are tracked by budget unit and are clearly
                          assignable to educational, administrative, and other purposes. This is reported annually
                          in our audited financial statements.
                    •     That portion of expenses allocated to centralized services is allocated by a fonnula,
                          known to the Department of Education, among the following areas: academic support,
                          student services, institutional support, and maintenance and operation of the physical
                          plant. This is reported annually in our audited OMB Circular A-I33 report.
                    •     Also, by agreement with the Department of Education, the total expenses for the Clerc
                          Center are broken down into the following two categories: national mission programs
                          and school operations. This breakdown is reported annually in our audited OMB Circular
                          A-l33 report.

                Furthennore, as noted by the OIG, there were no instances of unallowable items being charged to
                Federally funded general operating accounts during the audit period. We are open to clarifying
                reporting requirements with the Department of Education.




                                                                          9.oflO



                                                                   Attachment A  ­ Page 9

    
Gallaudet University’s Internal Controls
Over Federal Funds                                                                        Control Number ED-OIG/A03I0009




                Non-Capital Equipment

                As documented by the OIG, our policy is consistent with OMB Circular A-21. We will consider
                revising our property management policy to develop additional procedures to safeguard against
                the misappropriation or theft of such equipment.

                Reimbursement of Travel Expenditures

                Summary

                We agree there were a few instances of overpayment related to per diem reimbursement which
                approximated $145. Since the time under audit, we have strengthened controls including a more
                thorough review of travel reimbursement fOTIns prior to reimbursement. Our responses to each of
                the issues are summarized below:

                Reimbursement of Per Diem Using the Federal Rate of$64 per Dav
                The employee followed the Federal per diem rate for the applicable city as allowable under the
                Federal grant. The employee clarified with the Office of Sponsored Programs, which negotiated
                the Federal grant budget, that it was allowable to follow Federal per diem rates. Subsequent to
                the period in question, we revised our Board Travel Policy (see Attachment IX) to state that travel
                being funded by a Federal grant will be eligible for the per diem allowance established by the
                University. There was no overpayment of funds pursuant to Federal grants.

                Reimbursement of Per Diem for Two Extra Days
                A clerical oversight occurred when the employee recalculated the amountto reimburse the grant
                relating to per diem. When the employee requested a travel advance, the employee expected to
                be traveling for 8 days. The business travel was subsequently reduced to 6 days, and the per diem
                amount should have been adjusted accordingly. The total amount of overpayment was $128.

                Reimbursement ofa Full Dav of Per Diem
                The OIG's report states that the employee received a full per diem on the first day of travel
                though travel began after 9am. We agree with this finding, which resulted in an overpayment of
                approximately $6. Since the time under audit, we have strengthened controls including a more
                thorough review of travel reimbursement forms prior to reimbursement.

                Reimbursement for a Conference Lunch
                Our general practice is to advance estimated expenses to the employee prior to travel.
                Subsequent to travel, the employee reimburses the University when the original travel advance
                exceeds the actual expenses incurred. In this instance, there was one lunch covered by the
                seminar in which the employee received advanced payment of approximately $8 which was not
                reimbursed to the University.




                                                                        lOaflO



                                                                 Attachment A  ­ Page 10

  
                      Control Number ED-OIG/A03I0009




                                                                                                                                                                                           Att achmcl1l I
                                                                                                            Gallaudet Univers ity
                                                                               Response to Find ing No. 1 - "PcrsolUlci Costs were not Adequately Supported"
                                                                             Comp liance with OMB Circular A-21 "After- the-Fact Ac tivity Records" Methodology




                                                       JIOe2a   Activit y report reflect the distribution of activity             Personnel Action fonn (PAF) in Peoplesoft would reflect expected
                                                                expended by employees covered by the system                       distribution and Peoplesoft wou ld reflect the actual payro ll




                                                                                                                                                                                                              
                                                                                                                                                                                                              
                                                                                                                                  distribution




                                                                                                                                                                                                                                 Attachment B  ­ Page 1

                                                       JIOe2b   Reports refl ect after-the-fac t reporting of the percentage      PAF in Peoplesoft would reflect expected di stribution; and, for
                                                                di stributi on of activity of employees. Charges may be           changes. supervisors cont act payroll department to request a change
                                                                made initiall y on the bas is of estimates made bel'Q re th e     in distribution; also, GU pennits reasonable short-tenn fluctuation s;
                                                                sen /ices are perronned, provi ded that slich chan ges arc        al so, principal investigators review salary charges to their grants and
                                                                promptl y adjusted if significant differences are indicated       would initiate an y necessary payroll di stribution changes
                                                                by activity records

                                                       JIOe2e   Reports \'-o'i11 re asonably refl ect the acti vities for which   Supervisors with direct first-hand knowledge verify payroll time for
                                                                empl oyees are compensated by the institution. Records            pri or two weeks; for changes. supervisors contact payroll




                                                                                                                                                                                                                                                     
                                                                will be signed by the employee, principal in vestigator, or       department to request a change in distribution; responsible officials
Gallaudet University’s Internal Controls




                                                                responsibl e official( s) using suitable means of                 used the University Personnel Act ion Fonn (PAP) showing
                                                                verification that the work was perfonned.                         committed activity ("effort") on grants and all other act ivities in
                                                                                                                                  junction with the University bi-weekl y Payroll system to certify
                                                                                                                                  actual payroll di stribution and that the work was perfonned

                                                       JIOe2"   System will refl ect activit y applicable to each sponsored       PAF embodies all activities and accounts
                                                                agreement and to each category needed to identify F&A
                                                                costs and the functions to whi ch they are allocable.
Over Federal Funds




                                                                                                                        Page I of4




                                                                                                                                                                                                                                                         
                      Control Number ED-OIG/A03I0009




                                                                                                                                                                                                   Attachment I
                                                                                                                  Gallaudet Uni versity
                                                                                       Response to Finding No.1 - " Personnel Costs were not Adequately Su pported"
                                                                                     Compliance with OMB Circular A-21 "After-the-Fact Activity Records" Methodology



                                                       A-2!, section
                                                       J J002 "AfJer-
                                                           the-fact                         Federal Requirements                                      Gallaudet University System in Place during
                                                           Activity                                                                                                 2006 and 2007
                                                          Records "

                                                       J IOc2e          For professorial l.U1d professesional stafT, th e reports wi ll   Supervisors \\'ith direct fi rst-hand knowledge verify payroll time for




                                                                                                                                                                                                                     
                                                                                                                                                                                                                     
                                                                        be prepared each academic tenu. but no less frequentl y           prior two weeks; for changes. supenrisors contact payroll




                                                                                                                                                                                                                                        Attachment B  ­ Page 2

                                                                        than every six months.                                            department to request a change in distribution

                                                                        For other empl oyees. unless al temate arrangements are
                                                                        agreed to , the reports wi ll be prep<lrcd no less frequently
                                                                        than month ly and will coincide with one or more pay
                                                                        periods.

                                                       J/Oc2f           Where the instituti on lIses time cards or other fonns of         University used PAF and payroll verification during each two week
                                                                        afler-the-f.1ct payroll distribution as original                  period
                                                                        documentation for payro ll and payroll changes, such




                                                                                                                                                                                                                                                            
                                                                        documents shall qualify as records for this purpose
Gallaudet University’s Internal Controls
Over Federal Funds




                                                                                                                                Page 2 of 4




                                                                                                                                                                                                                                                                
                      Control Number ED-OIG/A03I0009




                                                                                                                                                                                                               Attachment I
                                                                                                                            Gallaudet Uni versity
                                                                                               Response to Finding No , 1 - " Personnel Costs were not Adeq uatel y Supported"
                                                                                             Compliance with OMB Circular A-21 "After-the-Fact Activity Records" Methodology




                                                       A-.? I,   \'ec:.:l lOn
                                                           J JfJh]
                                                       "( ' /'I teml f or                          Federal/(equlrem f!Jl/s                                 Gal/audet [ 'llil'er,'iity .\)'stem ill Plt,ce (lur;lIg
                                                        ,·lcc/.'pl(/h!1'                                                                                                     2006 (Il1d 2 fJ0 7
                                                         ,\ /ethoJ "




                                                                                                                                                                                                                               
                                                                                                                                                                                                                               
                                                                                Payroll di stribution system incorporated in the official      lnc1uded within Peoplesoft payroll sys tem




                                                                                                                                                                                                                                                  Attachment B  ­ Page 3

                                                       J/Ob2a
                                                                                records of the institution
                                                       JIOb2b                   Payroll di stribution system reasonab le reflects the          PAF in Peoplesoft would reflect expected distribution and
                                                                                activity for the employee was compensated by the               Peoplesoft would reflect the actual payroll distribution
                                                                                institution
                                                       J/Ob2e                   Encompasses both sponsored and all other activities on         Yes, PAF shows 100% activity
                                                                                an integrated basis

                                                       JIOb2b                   Recognizes principle of after-the-fact confinnation            Supervisors \\'ith direct first-hand knowledge verify payroll time for
                                                                                                                                               prior two weeks; for changes, supervisors contact payroll
                                                                                                                                               department to request a chan ge in distribution




                                                                                                                                                                                                                                                                      
Gallaudet University’s Internal Controls




                                                       J/Ob2e                   Allow confinnalion of activity to each sponsored               PAF embodies all activities and accounts
                                                                                agreement and each of the categories of <lctivily needed
                                                                                to identify F &A costs

                                                       JIOb2ll                  Payroll di stribution may reflect categories of activit ies    PAF has this by perce ntages
                                                                                eX1>ressed as a percentage distribution of total activit ies

                                                       J/Ob2e                   Direct and F&A charges may be made initially to                For changes, supervisors contact payroll department to request a
Over Federal Funds




                                                                                sponsored agreements 0 11 the basis of estimates;              change in distribution; also, GU penuits reasonable short-tenn
                                                                                sign ificant ch,U1ges entered into payro ll system             flu ctuations; also, principal investigators review salary charges to
                                                                                                                                               their grants and would initiate any necessary payroll distribut ion

                                                                                                                                      Page 3 of4




                                                                                                                                                                                                                                                                          
                      Control Number ED-OIG/A03I0009




                                                                                                                                                                              Attachment I
                                                                                                          Gall audet University
                                                                              Response to Finding No. 1 - " Persormei Costs were not Adequately Supported"
                                                                            Compliance with OMS Circular A-21 "After-the-Fact Activity Records" Methodology

                                                                                                                       changes

                                                       JlOb2[   Independent intcmal evaluations to ensure system's     University Internal Audit reviewed departmental payroll processes
                                                                effecti veness and compliance                          during the period

                                                                                                                       Also, A-l33 audit ors reviewed co ntrols and effectiveness over the
                                                                                                                       payroll system during this period and noted no deficiency findi ngs




                                                                                                                                                                                              
                                                                                                                                                                                              
                                                                                                                                                                                                                 Attachment B  ­ Page 4

                                                                                                                                                                                                                                     
Gallaudet University’s Internal Controls
Over Federal Funds




                                                                                                                Page 40f4




                                                                                                                                                                                                                                         
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                       Control Number ED-OIG/A03I0009


                                                                                                                                  Page 1 of2
                                                                          Gallaudet University
                                                                          Response to Finding No. 1- "Personnel Costs were not Adequately Supported"
                                                                          Attachment III



            From:
            Sent:      Wednesday, July 25, 2007 2:57 PM
            To:
            Subject: RE: APR follow-up: Gallaudet

          ok thanks




                  Very good. The number iS~• • • • •
                  I'll be here at my desk at 10...




                  ---
                  Talk with you then,




                  great thanks, I'll call you then - what number?




                         ~~:~i;::
                         Hi, Bonnie:
                                                                   Gallaudet




                        -
                         Yes, will tomorrow morning at 10:00 AM be okay?




                         O n 7/25/07,                                                               wrote:


                    ®       Hi.
                            r am reviewing your APRs for the FIP and RERC. Are you available later today, tomorrow
                            or Friday to chat?


                            IIIIIIIII-_MA, MSW
                            U.S. Department of Education



          1128/2009

                                                                                                      
                                                                   Attachment C  ­ Page 1


                                                                                                      
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                  Control Number ED-OIG/A03I0009




                                                                                                                            Palle 2 of2
                                                                           GaJlaudet University
                                                                           Response to Finding No. 1- "Personnel Costs were not Adequately Supported"
                                                                           Attachment III

                          Office of Special Education and Rehabilitative Services
                          National Institute on Disability and Rehabilitation Research
                          Potomac Center South
                          550 12th Street, S.W .
                          Washington, D.C. 20202
                          (202) 245-7358 (Voice)
                          (202) 260-8859 (ITY)
                          (202) 245- 7643 (Fax)




                        Associate Professor, Dept. of Hearing, Speech and Language Sciences
                        Director, Rehabilitation Engineering Research Center on Hearing Enhancement
                        Gallaudet University
                        800 Florida Avenue, NE
                        Room MTB 116
                        Washington, DC 20002
                        (202) 651-5335
                              651-5324


                        Confidentiality Notice: This e-mail message, including any attachments, is for the
                        sole use of the intended recipient(s) and may contain confidential and privileged
                        information. Any unauthorized review, use, disclosure or distribution is prohibited. If
                        you are not the intended recipient, please contact the sender by reply e-mail and
                        destroy all copies of the original message.




            1128/2009
                                                                                                 
                                                                Attachment C  ­ Page 2


                                                                                                 
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                    Control Number ED-OIG/A03I0009




                                                                                                                                 Page 1 of2
                                                                            GaJlaude! University
                                                                            R esponse to Finding No. 1- "Personnel Costs were not Adequately Supported"
                                                                            Attachment III



              From:
             Sent:      Friday, July 27, 2007 3:55 PM
             To:
             Subject: RE: FIP Grant # H133G060036 - An automatic fitting algorithm for cochlear implants

     ®
           -
           IMatt-IGood talking with you today and again,_ many thanks for your helpful clarifications.




                                                   1133GI~60'036 - An automatic fitting algorithm for cochlear implants

                   Dear_

                   This is the first of a couple of follow-up emails to you regarding our discussion yesterday
                   about the APRs for the above-referenced project. In addition, we discussed the RERC on
                   Hearing Enhancement, Grant # H133E030006.

                   Because you have recently taken over as project officer on our research programs, I am
                   happy to have this opportunity to update you on the F1P project referenced above.

                   Background:
                   The goal of this project is to design and evaluate an automatic cochlear implant fitting
                   procedure based on paired comparisons of speech clarity and quality made by the user
                   of the implant.

                   Status:


                               •• as co~sultant, and                      _8
                   The grant was proposed on February 6;2006, and awarded on ~)i:!!,!~~.s~a~me
                   year. The key personnel included me~or
                                                                                         i I
                                                                                            co-PI,


                   Shortly before the grant was awarded, _ l e f t Gallaudet University to take a position
                   in industry in California. Over the next few                   with the work while
                   seekini with the a~Vice of our consultant,                                 for_
                                          as identified as a very                he agreed to serve on
                   the grant as a consultant, taking over some                 responsibilities. A brief
                   CV for             is attached to this email.

                   It is still necessary for us to have some engineering support on the project, and we are
                   now seeking to hire a part time engineer to fill that role. We have some leads and
                   possibilities and expect to be able to have that position in place by this Autumn.

                   A second personnel action took place in July, wheD
                   her position as research specialist. We are current!y-;;::~-;:r;;;;



            1128/2009

                                                                                                   
                                                                  Attachment C  ­ Page 3


                                                                                                   
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                 Control Number ED-OIG/A03I0009




                                                                            Gallaudet University
                                                                                                                             Page 2 of2
                                                                            Response to Finding NO.1· "Personnel Costs were not Adequately Supported"
                                                                            Attachment III

                                                     , who will take up her responsibilities on or about Monday, July 30,
                                                       is also attached to this email.

                 In summary, we now have an almost full contingent of personnel on the project, and we
                 expect to be able to fill the remaining engineering position by October 1, 2007.

                 The primary staffing now consists of:

                 Principal Investigator:                                                                10% FTE
                 Engineering Consultant:                                                                4 hours/week
                 Cochlear Implant Consultant:                                                           1 hour/week
                 Research Audiologist:                                                                  50% FTE
                 Engineer/Programmer:                                                                    16 hours/week

                 It is important to note that while these changes have somewhat delayed our desired
                 accomplishments of the first year, we are nevertheless within the time lines approved in
                 the grant application.

                 I hope that this clarifies the picture for you.

                 Thank you for your interest in our research program and for your continuing support on
                 this project.




               -
                 Yours truly,




                 As,;ocl,ate Prclfe"sc,r. G"aiiaud"tUniversity
                 Department of Hearing, Speech and Language Sciences
                 Director, Rehabilitation Engineering Research Center (RERC)
                 on Hearing Enhancement
                 800 Florida Avenue, NE, MTB 116
                 Washington, DC 20002
                 (202) 651-5335 (VfTTY)
                 (202) 651-5324 (Fax)

                 W'IfNoI. hearing research .erg
                 Confidentiality Notice: This e-mail message, including any attachments, is for the sale
                 use of the intended recipient(s) and may contain confidential and privileged information.
                 Any unauthorized review, use, disclosure or distribution is prohibited. If you are not the
                 intended recipient, please contact the sender by reply e-mail and destroy all copies of the
                 original message.




            1/28/2009
                                                                                                
                                                                Attachment C  ­ Page 4


                                                                                                
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                       Control Number ED-OIG/A03I0009

                                                                                Gallaudet University
                                                                                Response to Finding No. 1- "Personnel Costs were not Adequately Supported"
                                                                                Attachment IV




        GALLAUDET                                                           '~===~=
                                                                           ~!]
                                                                             ~             U N I V E R SIT Y                                      (j
                                                                                                                                                      /




       OFFlCE OF SPONSORED PROGRAMS                                                                                           ICEND.A.U. GREEN
                                                                                                                         800 FLORIDA AVE. NE
       (202) 651·,401 (V {TTY)
                                                                                                                   WASHINGTON, DC 20002-369'
       (202) t'in·5792 f.A:X

        September 2, 2008


        1I!I• • • • •     r-
                           Project Director     .
         Department orneafing, Speech, and Language Sciences
         SLCC3201

         REF:     U.S. Department of Education Award No ..H133E080006: "Rehabilitation Engineering
                  Research Center on Hearing Enhancement"

         Dear • • • • •

         Congratulations on receiving funding for the above referenced project with the U.S. Department of
         Education. This funding is from October I, 2008 ~tember 30, 2013; the funding amount is
         $4,749,752. By copy of this letter I am n o t i f y i n g _ Grants Accountant (ext. 5273 VfITY), of
         your award.
         As ·Project Director, you are expected to be informed of the requirements set forth in the formal award
         documentS. It is recommended that you Teview the terms and conditions qarefully. Should you have
         ianiiy.qluiieilsti~·o~nis, both this Office and the Controller.ls Office are available to assist you. On behalf ofll
         ~                        Dean, the Graduate School and Professional Programs, and the staff of the Office of
         Sponsored Programs, 1 wish to congratulate you on receiving this award.

         Sirtcerely,




                                     SP<iiiSored Programs

          cc:                                              Graduate School and Professional Programs
                                                            Accountant, Accounting Department




                                                                                                      
                                                                     Attachment D  ­ Page 1


                                                                                                      
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                  Control Number ED-OIG/A03I0009

                                                                          Gal1audet University
                                                                          Response to Finding No. I· "Personnel Costs were not Adequately Supported"
                                                                          Attachment IV




                 UNlTED STATES DEPARTMENT OF EDUCATION
                        OFFICE OF THE CHIEF FINANCIAL OFFICER
                             & CHIEF INFORMATION OFFICER
                                       July 3,2008




      Hoaring Speech Lang. Sciences GSPP
      800 Florida Ave., NE
      Dawes House, 3rd Floor
      Washington, DC 20002


      SUBJECT: Payee Veritlcation for Grant Award H133E080006
       This is to inform you of the payee for tbe above listed grant award issued by the United
       States Department of Education.
       Grantee DUNSISSN: 003259439
       Grantee Name: Gall.ud.t University
                     Hearing Speech Lang. Sciences GSPP
       Payee DUNSISSN: 0037,59439
       Payee Name: GalJaudet University
        If any of the above jnformatioll is not correct, please contact a Payee Customer
        Support Representative at 1-888·336-8930. Please send all correspondence relating 10
        payee or bank information changes to the following address:


                                          11 ,S, Department of Education
                                          400 Maryland Ave., SW
                                          Room 4C138
                                          Washington, DC 20202

                                           Attn:
                                           Phone:
                                           Fax: (202) 260-5505


                                                                                                                                              u


                                                                                                 
                                                                 Attachment D  ­ Page 2


                                                                                                 
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                                              Control Number ED-OIG/A03I0009



                                                                                                      Gallaudet University
                                                                                                      Response to Finding No. ]- "Personnel Costs were not Adequately Supported"
                                                                                                      Attachment IV

                                                                                   u.s. Department of Education
                                                                                       Washington, D,C. 20202

                                                                    GRANT AWARD NOTIFICATION
                ){8CIPIENiNAME:                                                                  AWARD INFORMATION
            1       cl~I1Dudel U~il'(:T~it>,
                                                                                             5    PRfAWARD NUMBER H13JEOSOOO6
                    Hcurinl! Spe~th l.nn~.       Scicn(;(!S c;srp                                     ACl'lON NUMBER 01
                    gOll Plorithl Ave., NE
                    D:IIVC~ Ilou~c. 3r~ FIQ(lr
                                                                                                            ACTION TYPE N,w
                    W.:l.~l'inglon. DC 2.00I1J. - 3m~                                                       AWARD TYf>8 Oiscretlonary

                                                                                                 A WARD PERIODS
                PROlECTTJTL.E                                                                6              BUDGET pERrOD lO)01/2008· 09/3012Q{)\l
            2       M.lJ3E:
                                                                                                      PERFORMANCE PEl"UOD t%t/lOOe - 09/3012013
                    RERC on Hco\lrinf!, EnhDllcemcrlt
                                                                                                 FUTUR~ BUDGET PE.RIODS
                                                                                                 BUDGET PERIOD 1UJ..~                                 AMOUNT
                                                                                                      01             10101/2009 - 09f.\on.Ol0         S949.99i.OO
                PROJECr STAFf'
            3       RIiCfPI"Ei'H PRO.Ir:.GT OIRECTqr..
                                                                                                      03             I OfO 1/20 I 0 - 09/30120 II     S949,953.0{)
                                                                                                      O.             J 010 1/2{111 • 09/30/2012.      $949,94(\.00
                            J;lmc.~ Mllhshi~                         (20::) (J51 • ~n9
                                                                                                      !l5            10/0112012· 09t3 0120 !3         .'0949.921.1'0
                        EDUCA1'100 PROGRAM CONTACT                                               AtlTHQRIZED FUNomG
                          ThOI11M Corfl1lE1.n         (i02) 2.4:5· 7;l(lG                    7                                  t'HIS ACTION                 $949,935.00
                        rDLJc ..... ·nON PAYMENT CONTACT                                                                    BUDGSTPEltlOD                    $949,\l35.00
                           GAPS PAYEE KOTLINE         (aaS) ~jli· a5l36
                                                                                                                    PERFOR.M ANCE P BR10D                    .';;949,92.5.00
                                                                                                                 ·REC1P1ENT COST·SHARE                              21.71%
                                                                                                     RECIPIEN'T NON-FEDERAL AMOUNT                           S206.2(\3.00

                    KiN PERSONNEL                                                                ADMINISTRAT!VE INI'ORMA ,'JON
            4                                                                                8
                        NAME.                          :r!.Th.e
                                                        PrOject Director
                                                                                =_!IT
                                                                                LEVliL OF

                                                                                   40%
                                                                                                       DUNSISSN
                                                                                                  REGULATJONS
                                                                                                                      003259439
                                                                                                                      CFRPART 35~
                                                                                                                      BOGAR AS APPLlCABLE
                                                        Co-PT                      40%                                A, E3 OS8RSfN, C, EI, E2., E3, F, S, HS;l
        I                                                                                        AT'TACI-rMEN"f'S




                        U:G!SLATIV2 AND FISCAL DATil
            9        M)THORITY: Pl. 99-506 REHA!3JLlTATION ACT OF' 1973. AS AMENDED
                        1'f\OORAM TfTLE; NATIONAl. INSTITuTE ON D1SAI3lUTY i\ND R8HAl3iLtTAT10N RESEAR.CH

                        ("1~r.1AlS\ iBPRO<"jP-AM     NQ;   84.13~, C

                        Fl.:Nn       FUNDING        AWARD             ORG.         CATEGORY LlM1TAnON            ACT[VTTY CFDA              OBJECT          AMOUNT
                        CODr:         YeAR           yr::AR          CODE                                                                   CLASS

                        lI~{)1   A     2()(jR         2001        F.HNDOOno              B           L63              412          133        410lJ        59"49,935.DO




                                                                                                                                                                               .   1
                                                                                                                                                                               v
            Y~I".   I




                                                                                                                             
                                                                                  Attachment D  ­ Page 3


                                                                                                                             
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                                Control Number ED-OIG/A03I0009



                                                                                          Gallaudet Un iversity
                                                                                         ~=~:~~ J~nding No. 1- "Personnel Costs were not Adequately Supported~
                                                                         U.S. Department of Education
                                                                           Washington, D. C. 20202
                                                                                                                                                       ( )/
                                                          GRANT AWARD NOTIFICATION

                PR/A w ,~ Rf) NUMBER:      H 133E080006

                REiCl I'rENT'NAM E:        aa l hlUd~ t
                                                     UnivCfsity
     10                                    Hcari"fl SpMch l.an&:, Sciences as,pp


                TeRMS A ND CONDIT IONS
                   (I)     THE FOLLOWINO ITEMS ARE INCORPORATED IN TH E OR.ANT AGREEM ENT; (I )
                           Tf-IE ROCIPIF.NTS APPUCATION (BI.OCK 2), (2) TilE. A?PL.1CABI.. B EDUCATION
                           D6PARTMENT REGu L ATI ONS ( Bt.OCK8), A ND (J) ru e: SPOCIAL TERMS A ND
                           CONDITlONS SHOWI" AS ATTACHMENTS (BLOCK 8).

                           lJ-I IS '" WARD SUPPOR1.!:;"ONL Y 1"HF, BUDGET PERIOD SHOWN IN BLOCK 6, IN
                           ACCORDANCE WITH 34 CPR 75,25~. T HE DEPA RTMENT OF EDUCATION WILL
                           CONSIDER CONTIN UED FUNDING IF: ( I ) CONORESS HAS A.pPROPRIATED
                           SUFFICJcNT FUNDS UNDER THe PROGRAM. (2) THE DEPARTMENTDETEltMTNES
                           TIIAT CONTINUING TH B'PROJECT WOUt..o BE!N THI3. 8EST INT EREST OF' THE
                           GOVERNME.f'IT. (3) THE R.CO PIENT HAS MADE SUBSTANl1AL PROGRESS
                           TOWARD MEETINO THE Or!!ECTIVES TN ITS APPROVED APPlACA TION.' AND (4)
                           THB R.Ec!prENT HAS SURMrrTED REPORTS O'F PROJBCT PERFORMANCB AND
                            BUDGer EXPeNDITURES THAT MBET THE RePOR.TItK) REQUIRLMENTS FOUND AT
                            }4 erR 75.118 "NO ANY OTrtF,:R REPORTING RBQU!RBMENTs &:i'TABt.!SHED BY
                            THESgCRETAR Y.

                            !N ACCORD ANCE WTH 34 CFit 74.25(c}(2), OR 34 O"R. 80.l0(d){3) CHANCES TO KEY
                            PERSONNEL IDENTIPIED rN BLOC K 4 MUST RIlC£lv E PRIOR APPROVAL FROM
                            TH!} DEPARTMENT.                                '

                            THE SECRETARY AN'TIC1 PATES plJTIjRE FUNDlNG FOR TtilS AWARD ACCOIUHNO
                            TOTHE SCHEDULE-IDENTIFIED tN BLOCK 6. ,THSSE FlOURES ARF.. ESTIMATES
                            ONL Y AND DO NOT BIND THE SECR.ET ARY 1'0 f"UNDli'lG THE AWAR!> FOR THESE
                            PERIODS OR POR T,",B SPEC1FIC AMOUNTS SHOWN. 1'H E REC1P IIDf)' WILL BE
                            NOTIF1 ED OP SPECIFIC rUTURI? FUNDING ACTIONS THAT THE SECRETARY T AKES
                            FOR THIS 1\ WARD.
                    I ~)    THE RECIPI ENT IS REQUIRJiD T O CONTRI13Lr]'E. TO TOTAL. PROJECT COSTS TKE
                            DOLLAR AMOUNT SHOWN IN GLOCK 7_




                                                                         AU THORIZI NG OFr[C1At.                     DATE




     V(.!T. I
     ED-G A PSOf) I'(O" V&)




                                                                                                               
                                                                          Attachment D  ­ Page 4


                                                                                                               
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                                                                     Control Number ED-OIG/A03I0009


                                                                                                                    GaUaudet University
                                                                                                                    Respo nse to Fjnding No, I· "Personnel Costs were not Adequately Supported"
                                                                                                                    Attaehment IV
                                         EX-.t>r~ANAnON                OP BLO CKS ON THE GRANT AWARD NO-rrFIC AT10N
    Fur   Dl'll.'relh'~i!r,. ,   fnrmulll , M(! Blnck Grnnts                        (SU S;od( S oIl1le fWlll\C.!lIo11)
    I. RF.("1PI!';N1' NAM E· Th! ~~I nami ollhe It~nl narTl\\ al!hl! pr1m8ry Ql94nitullonllllJlIIllhll Wli undlma~G tht llndid acti'lly, and I~ compltll iJddrm o! \nt
                                       lacipiclnt Th~ lIIeiplen\ i!5 CllII'IITm tr ll"lOWn a~ the ·g~nl.. .'
    1, l'"RO.Jt(..'T TITLe AND CtDA r-I(lM8ER · llleMlr~1 IhtC.lrIIog ofFedtllll Domesllc M.I'$I.!nt:a (UDAl su~arn gt\e!nd                             t.t .~Ied $\ll:lfllt:vmm nulTlbst.
    3. PROJECT           ~TAPIi . T~ b\ocII con\llkII 1M 1\61f1e' lind IeIIj:II\oIlt l\llIlIImo( ItIO     u.s. OapQrunent of Educ:alDnallCl rtdpionIstaf Who an ~lI!le lor ptOjeddi~
                                       Md oYerwighL
                 ~R~[I'TY.NT                   ,The red\lient SlaH ~er"on lIipon: ible kl/ edmlnisrertig \tiel proJeC\, Thi& parllon II pfC!'Q~ts \he rcelpiarn l0 the U.S,
                                     f'ROJtCT' DIRECTOR
                                                  Dllpao1m=nl d S-doolt1o r\,
                 Ell UCATIOf'If'ROGRAM CONTACT . TIIQU.S, ~ojEducl&onmJpenonl~forl1e ~I!c, Bdml/l$lrn1lvc8~ bu~·
                                                                         ma~enI oorx;ems 01 k             . Oo:par?nlllt
                 EDtIC,\TlOT'/ l"~YMIrnT CONTACT'                      . Thi U.s,   Dep~MIfJTlI d EdlCl!lonst!lRper:onrE~ponsIbLnbr~ Dr que3ti¢r1$concemifl{le\9cb"0!l~~cwn
                                                                         ~nd ftna~al a!:pllndllul~ rapotting.                                                                                 .
    4 ." KEY Pl;:RSONNEL                         . NOOl8, Wl!e iIIld pmcenla.(!Q (%) 01 ef/QnlM key pet'$OO1l~1 idenUI'red devotes ~ HIt PI'~a!,
    "', A WARD INFORM" T10N                  - Unq.e mm$ dlnlrumalion thai kIeniIr!hls rolflcaliM,                                                                            .
             l'RJA WARD NtM~O • A uflir100, ld6ntfyilg fWIriIerlJ::l~lgrledl7jfl1l'~llfl!tleWlappfll;3lioro. OnlUllded;.pflbtians,lhO$ k mrrl'l'lOlltrknor.¥naa !hl:
                                               ·\If3I1I~lJITIbcr"Qf ·oClClJ rncntn~mbel.'                                                                     .
              ACTION NUJ".1"Y.l!n            . A numtl~llha\ represerlls!ho cumtbtj...e rlUmberof $tep; t~~!!:n by the Department 10 ~a!E to I!$ta'olish o- mooily tha aW~ rdth1Ollgh rml or
                                               admrulhln-' ms<m:I. .-.ctiOn nt.mber ·(H"WI i1wft~ I)e! 't-IEW "WAAO'
             ACTIO'" TYl'E • TbeM~mar 1hb ~bb (e.g;. HEWAWm,COHT!NUATKJH.REVISION,ADMlMSTAAilVE)
             ,\WA,.'R.I) nrm .The p~f ~sl! tallCe ~ il..d1ich Iun!Ii'lg fcrltis naKI is pnwIdod, i.e" DISCRETIONARY, FORMI./l.I., or BlOCK.
    ~. ,\ w,~ Jl.D PERIOOS • ~clllc¥Yllie. and tundklg tifll approvedwl\ll re~p!!(ilo .....II£: ~!lIe"H'\t tknto p~ de$C1ibe<J h~
             JlI..J!)C&t P15RmD ·A specilic iltervil loftirnt fOl' whleh hd ~' vnds III'Bbeing ~oofillad fl'Ql1\ ~ particYt~r fiac:;l1 y~ !!rto IUlld a rWpien\'$ ~ppn;r.Jeg' IIc\ivl!,le~
                                         an<I buc!gr:t. The $lIlt ind MIl da\RS oItJe btll!igel ~ are s\IQWn.
             PERFORMANCE PSRIOD ,The COmpleh 1!ngllofli.1nllbatecipientls PtOIJOIedlo bt tIn.d!ld/l)~,,~ ¥tMtleJ. AparfrIma.~ pl!'llod lToIIyctlll1::1n
                                                     0(If 0I'!!'D1e budglll period!,

              "FtITORE BtIDG1<:T PERlonS . Thtfl$Umaled renmlnlng bU<!gat ~rkl~~ tc:r m\llll·ygu prcJt!Cls and !~6m.a\!d rmllle Oe'j)a~tprcllO'l!! I w!I ~watd Ihe
              redptl l\l provided 5\lbltan~~\progr!1S is mi de b'f \h e reelpklnt In li¢Il\~lellnQ apprQved aclMuas, \he:                                                      .
              Depll'lmtni ~s 8111 con!iIwinQ Ih~ ~ wou'd ~ \rI1ht b9!.l interest oIlh8G~rrt. Cang!W _W"ClJlItes ~urre\anl runt!!; u~dtr the ~rall\ 100
              lie reeipiltlt hi» ~ II penonnatw:lt report f\al ~ II': /I1l5l GW1'Mi p!lformanet Wofrnalbn and ~ lUllS d iJudga{ ~m:lIuf!s.
    1, AlI1'HORIZ!;IlFl.1NnfNQ ,Thed~rUg~tn\tllsb~*rollfe Fflder~ Nndsproo.+dedlOaradpbn\"'.IMgIheIrf!eld~I!rkld:; .
            • THl~ I\CT10N               • Thm amount 01 funds oblig ated (ldd;d)or\!e-~Iglt~c' (sob(ta~dl lIyll1l$ ooHllcaton,
            t BliDGET PERIOP . ThQ IOtal ll1\Ollr"ll. oflrndllyallabli r(ll"~e byWle grante~ during !hi ,teted b\ld9BIP~liaI;I to thllda\G,                                                        )
            tPE1l:l>OKMAN~ rT.RIOD . The e~dJuodsObiUattd hxnfte,';I!\dille It tile f,I'5Ibud9etj)etbdtoGlis d~le,
            RF.crPl EJ'fT COST.sH ARE . The ",,., u.pteS$ldll$l pert;f1l!JQe.1"llll1he I'IItipl!!nI ~ re-quL'lId lo a)l\~ 1D!be ~ esc1efJnt6 by fit progta:nlaglslalb/l
                                                     or I'tgY latklru; !lndIct!am1S andccl\diIom Of lie I)'tIfOIrd ,
            RECIPl"EN7 1'70N·FEDERAL AMOtJN'[ . The ~movnl cI non·ledllr;lll\Jndsl1e re.~~nt rTl\Jstcafl1/bJla wth!! project M it!en6fied ill IIlI recipient,. app!!c2l!iol1,
            WiIM nOflofl!claral fund::! ~ ideli!,HiM by Ih~ ~~nt Where Brmlsh<n Is nl)\ a ~1sla\ion reqlllram~~l 111 recI~antwill be roqlJlred to prt'lIIi~l'Ilha noo-fedel'(li
            wnds.
    S, APMIN ISTRAllYt: INFORMA TrON· TbiJlnfornIIIrlOOl i$ ~ k1assis1ltJ~ ~ in CQI:1pielil'l tie- apprOYe1lItllidlM a/lldmane,gillg ~~etirl aocmssnce
          "';lhU.S.~ol Ed ~ proCfllkm lncllfqll ~                                                                                                         . .
                 T)UNlitSSN                . ,., \mlqll!l, i'jenllfylng oombGT !llsigne.d Ie rnlCh ree\r)ienl k>! PlI'ftllIlnt ~U!pDSeS, m~ lWmbiJ"b b~ on i\[h~r m teclplen!llt$,igne~ number
                                              tom Dun:!fld Blad~treel ~\hQ ItdMW!i~ soc!31 ,eev rl1~ numb~.
                 *RECOtA TtONS • The ~rts"Ol\llt Educaton ~aM'cnt GlUlfral /l.00ii11s~ Ragulallcms.(EDGARJ em: !oPQdI'iC jmilltlm regif.:llloos tlIatgovom the ll."lIOrd
                                           itId a~miliIb1tion of ~ gmn!.                                 ..
                 AATfAClIME rfrS ,Mdi5c nitl scd'1OfIS oI lIIe GranlA't(1J~ HoUcaOOn~i!lsruM pc'Jmonl :lrl!l ~ltil'€l ~Ihmen!s, expIOODep;:!rIment~res, and 3dcI
                 speclt!llerms afld cond!tiOI\$!n ;ddib 1.1:1 \tJr.1$~ e!t~b6.shed, end shawn t!I! C\8IJsRS, [n,BIoc'I: ,oJ of tho awerd, Arrf attElthrnent:$ ~lovkJoxfwi1 artc~lb.lIon conttlul
                 Nt ef(acllhrough \he proJect perio~ vntl modifted orreldn{\cll byIh! "'utho.1~ Offic;i.aL
     9, 1..F.(;1!iI.A.T1Vl; II/'I'D FISCAL nA·tA • i hall5l'l6o( lh t luBlClIIzinVleg!llatlDnfoflilisgrftlt ll\tcro~Wtof lhe:p!Og 1'/l11l ih~~ wntllng lsp:tl'lid.~
                                                          trill U,S. OcpartrMnt It Ed!lCaial tlscil ilblTl'.aft:tl,
                nINo GODE, fUNniNG YEAJt. "WARD YEAR, ORG, COOE, PROJECT CODE, OBJECT CLASS
                 . The b~1 i1form~tlon ~con:let! ay th; U,S, ~partmlrll 01E~(IQn'l Oral'l! AOmInlsuai on !nQ P~ymmt S,!Ittm \Q b"acl:. obiig?lti(M'lS b'j awMl.
                ,\MOU\'lT • The I!.IT\Mt 01 f\ll1d s ?IC~iDed tri)(t1 a pertieUlerepprQptiaUon 'lId proJim iXlde, $0100 r.o!i/Ice;1iot1s ~ooze moM than OIleamoo~t from s~paral'
                1jlfJfOp~1onIi ar.dhx ~ axle!. 1M toJ.;!(l{ai art'IO'.='lil ~ 1M bIod eQ,u~b t.e BmOItIl.shown an fie iJ\t, '111lS ACTION" {SIll •...UTHORlleOFUNOItH,;-
                aboVe IBloct.1lJ.                         .
     [0. 'rl':P.MS "fliP CONDTTlONS OF AWMm . RaqoJ'remetrt::! OIrle a\I'~rdlhll\ are bind~ ItI ,11\" l1lcir* nt
                ~ AUTTiORli.ING O)frlCIAL , rnl! U,S. Depal"j'119n\ aI !;dl)()~\iQI'I oIfiCIIIl authorized to 21Wrtrd Federal1\!00, to !hot rgclp!tnl, ~\sb!lh ordJa~e!he lerrM lIIld
                                                          r.ondkPn~ oIthe .w~rd, arld !lul~~ modirJC~tion,!O Ihe ~w8rd,

      FOR FORMUi.A AND BLOCK GUANTS ONLY:
     ($.\I: tll'lll Blolt!o., ) , 2.:'. fi , S, ' uOIi l1l above)
     J_ F.lJUCATlON STAFF
     1, Atm~OR[1.ED FUNDING
              ClIRRE.NT AWI\R.O A..MOUNT                                   • Th!/llTr.'Un\ of kmil s~ , ...e obBg aled (~.d) ord~-<lbl98 \~ (&Ub~aaed) by lh~ acton.
                    PR.EVtOUS CUMULl\TIVE AMOUrrr                          - Ttla IoIal cmoumof 1un4s ~'1fIftIed unOer l'te9fM\i before lI1i!5l1.~
                    CUMl)I..A.T1VE AMOUNT                                  -iht \crtzII ~"' cllu""'1 e"I'iIrdo d UIldcr lhe gnnl. this dDllin~.

          ""   Th i~   item (lit't'ers   llT   does not appear on formula and block                       ~ran~.




                                                                                                                                                    
                                                                                             Attachment D  ­ Page 5


                                                                                                                                                    
 




                                                                                                                                                                                        Over Federal Funds
                                                                                                                                                                                        Gallaudet University’s Internal Controls
                                                                                                                           Gallaudet University
                                                                                               Response to Finding No. 1- ~Personnel Costs were not Adequately Supportedn
                                                                                                                              Attachment V



                                                      Federal Awards for Dr. Matthew Bakke during FY06· FY09
                                                   




                                                                        Hearing
Attachment E  ­ Page 1

 
 




                                                                                                                                                                                        Control Number ED-OIG/A03I0009
                                                                                                                                                                            311712009
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                                                                                      Control Number ED-OIG/A03I0009




                                                     TIII II
                                                                                        II
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                                                                               Attachment F  ­ Page 1


                                                                                                                                                                
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                                   Control Number ED-OIG/A03I0009

       Administration & Finance - 2.06 Procurement - Gallaudet University                                                                   Page 1 of2
                                                                                    Gallaudet University
                                                                                    Response to Finding No. 2- "Procurement Policies Need Revision and Updating"
                                                                                    Attachment VII
        "        •   ~~..!_~'   '__ )J.-t';.'~   _~,,-   c~     -::.-"',":!_                    ~-...--


        Gallaudet University ','                                                                                 _                   c=:==::J
        ,
            Administration & Finance" A&O Manual" Section 2: Fiscal and Physical Resources" 2.06 Procurement


              Administration & Operations Manual
              2,06 Procurement
              Last Revised: 15 January 2008
              Refer Questions To; Executive Director, Business & Support Services

              Scope

                      This policy applies to all offices and divisions of Gallaudet University,


              Policy

                      Gallaudet University provides the necessary supplies, equipment, and services to support the
                      programs and services of the institution, The UnIversity does not purchase goods and services for the
                      private use of any employee or student. The use of the UnIversity's name, funds, pricing schedules,
                      and tax exemption status for personal purchases Is strictly prohibited, In all procurement activities,
                      the University encourages affirmative action in procuring goods and services from suppliers who are
                      deaf and hard of hearing and/or members of traditionally underrepresented groups.

                      Purchasing Cards
                      The purchasing card program provIdes campus departments with a quick and easy means of
                      purchasing equipment, supplies and services for daily business operations, Cards may be issued by
                      the Contracts and Purchasing Department to unit administrators and full time employees with
                      manager and above classification. Cards may be issued to employees below man~ger classification if
                      requested by the unit administrator and such requests meet specific business and operational
                      requirements justifying issing an additional carel. Requests for a purchasing card and the spending
                      limit must be approved by the unit administrator and senior administrator. Each approved cardholder
                      is required to sign an agreement which describes the responsibilities associated with the use and
                      safeguarding of a purchasing card. Card holders will receive a Purchase card Manual detailing
                      authorized uses of the card, Failure to comply with Cardholders Agreement may result in the
                      revocation of purchasing card privileges and disciplinary action up to and including termination of
                      employment.

                       Spending limits are approved on an individual basis in accordance with the policy on Authority to
                       Approval Financial Documents. Single transactions exceeding $5,000 should be submitted to the
                       Contracts and Purchasing Department for processing. Whenever practical, the Contracts and
                       Purchasing Department solicits competitive bids on all single procurements over $5,000, Purchasing
                       cards may r)ot be used for personal items or for any reason that is not directly related to the
                       cardholder'S professional relationship with the UniversIty, including, but not limited to, food
                       and beverages, personal items, electronic eqUipment, appliances, fumiture, luggage, traffic fines,
                       gifts, club dues, travel insurance (other than rental cars), in-room movies, personal entertainment,
                       airline clubs, baby-sitting fees, clothes, personal automoblie repairs, alcoholic beverages, flowers,
                       catering services, and personal servIces,

                       Cardholders are required to maintain records an_a original, itemized receipts of all transactions, The
                       monthly credit card statement with all original, itemized receipts attached, must be sent to the
                       Finance Office by the 15th of the following month. If a receipt is missing, a written explanation
                       detailing the nature and reason for the charge is required, Unit administrators are responsible for
                       assuring that the goods and services were received, that appropiate procedures were followed, that
                       appropiate documentation has been provided, and that applicable University policies and Federal
                       regulations, including those on travel expenses, were followed.




       httn:llnllaudetedulaf/ao s206xml                                                                                                        3/17/2009
                                                                                                         
                                                                               Attachment G  ­ Page 1


                                                                                                         
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                                               Control Number ED-OIG/A03I0009

        Administration & Finance - 2.06 ProclITement - G~11 __ ...:l_... TT:-;~',:,.rsity                                                                         Page 2 of2
                                                                                          GaIIaudet UmversIty
                                                                                          Response to Finding No. 2- "Procurement Policies Need Revision and U~~atjng"
                                                                                          Attachment VII                                                                        P"
                  UfJUII   """1-'<:1' "'''WI I   IIVI"   ",O"OUUt::C Vilivel ~ILy, VI   LI al."n01   Lva vilier ""'L vellal Ul,ellL YlII.I III 1 Lin: Ul lIVt;:' ",LY,


                  the cardholder must surrender the purchasing card and all documentation to the unit administrator.
                  The unit administrator is responsible for reconciling the account with the employee. The purchasing
                  card must be returned to the Contracts and Purchasing Department Purchasing cards are not
                  transferable.

                  Faculty, teachers, and staff may not accept personal gifts or gratuities from any current or potential
                  supplier if such acceptance obligates or could be -construed to obligate the University to conduct
                  further business with that supplier. Occasional association with suppliers at luncheons or dinners and
                  the acceptance of small advertising novelties are helpful in establishing bUsiness rapport and are not
                  considered unethical provided that the purchasing decision Is not influenced or compromised.

                  Contractual Arrangements
                  The University does not enter into contractual or procurement agreements with students, faculty,
                  teachers, staff, or members of their immediate families. An acquisitions of goods and services from a
                  business in which an employee has an interest is prohibited unless full disclosure of tile background
                  facts is presented in writing in accordance with the Conflict of Interest policy.

                  Former employees may be awarded consulting agreements; however, during the first two years
                  following separation, the daily rate for the consulting agreement may not be more than ten percent
                  (10%) above the former employee's last daily rate with the University.

            Approved by: Ga/laudet University Administration




         htto:!/gallaudet.eduJaf/ao s206.xml                                                                                                                             3117/2009
                                                                                                    
                                                                          Attachment G  ­ Page 2


                                                                                                    
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                          Control Number ED-OIG/A03I0009



      Administration & Finance - 2.01 Budget Responsibility - Gallaudet University                                                 Page 1 of2
                                                                            GalJaudet University
                                                                            Response to Finding Other Matters- "Accounting for Federal   Appropriation~
                                                                            Attachment VIII




        "Administration & Finance> A&O Manual> Section 2: Fiscal and Physical Resources> 2.01 Budget Responsibility

           Administration & Operations Manna!
           2.01 Budget Responsibility
           Last Revised: 6 Oct 2000
           Refer Questions To: Office of Vice President, Administration Finance

           Scope

                  This policy applies to all offices and divisions of       ~allaudet   University.


           Policy

                  Gallaudet University receives a significant amount of funding from the Federal Government through
                  the U.S. Department of Education. The President is responsible for presenting Federal budget
                  requests consistent with the mission and goals of the University and for ultimately determining the
                  amount of funds to be allocated to divisions and units.

                  Responsibility for budget management and control is vested in administrative officers who may
                  delegate signatuie authority to management personnel who are considered budget unit heads. It is
                  the responsibility of both administrative officers and budget unit heads to manage their resources
                  responsibly and effectively and to operate within the resources provided. Once the budget is
                  determined, it establishes a level of spending authority which may not be exceeded without the
                  approval of the administrative officer. Administrative officers and senior administrators mi!lY move
                  funds within and between units under their control through the budget revision process.

                  The Education of the Deaf Act Amendments of 1992 place certain restrictions on the use of
                  appropriated funds by Gallaudet University. Specifically, the University is prohibited from using
                  appropriated funds to pay for:

                       Alcoholic beverages
                       Goods or services for personal use
                        Housing and personal living expenses (but only to the extent such expenses are not iequired by
                        written employment agreement)
                        Lobbying
                        Membership in country clubs and social or dining clubs or organlzations

                   Payment for goods or services contained in this list may not be mi!lde from accounts supported by the
                   University's Federal appropriation. This restriction extends to funding for travel and entertainment. If
                   a budget unit head has any doubts concerning the definitions of these items, the Office of the
                   Executive Director, Finance (Controller), should be contacted.

                   In addition, the Education of the Deaf Act Amendments restrict, but do not prohibit, the use of
                   appropriated funds for several other purposes. These include interest payments on loans, costs of
                   building and equipment rentals, ~nd payment of royalties and other costs for uses of patents. In
                   general, the University is permitted to use appropriated Federal funds for these purposes as long as
                   the costs are reasonable. In the case of interest payments on debt associated with the construction or
                   renovation of buildings, appropriated funds should not be used to pay for any debt associated with
                   construction that occurred more than 10 years ago.

                   It is the responsibility of the Vice President for Administration and Finance and staff to monitor and
                   control the expenditure of funds and the revision of budgets during the course of the fiscal year and




       httn~//o"::llhmr1p.tf'.r111/~f/ao      .o::?,Ol.xml                                                                               3117/2009
                                                                                                
                                                                      Attachment H  ­ Page 1


                                                                                                
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                    Control Number ED-OIG/A03I0009




        Administration & Finance - 2.01 Budget Responsibility - Gallaudet University                                           Page 2 of2
                                                                           Gallaudet University
                                                                           Response to Finding Other Matters- "Accounting for Federal Appropriation"
                                                                           Attachment VIII

                 to ensu re that the University's financial resources are managed effectively 2lnd prudently.

            Approved by: Galfaudet UniversIty Board of Trustees




                                                                                                                                  1/170.009
                                                                                            
                                                                  Attachment H  ­ Page 2


                                                                                            
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                               Control Number ED-OIG/A03I0009



       Administration & Finance - 2.05 Travel- Gallaudet University                                                                      Page 1 of4
                                                                              Gallaudet University
                                                                              Response to Finding Other Matters- "Reimbursement of Travel Expenditures"
                                                                              Attachment IX
            I      ___   ~_~   _.$'';::'' ~__ ';;     '.     i'~~",.   ~       ~'_    •     I"-'   .-~


        Gallaudet UruverSlty,                                                                                 ~ c:::::=:::J
        ,
         Administration & Finance-:>   A&O Manual:> SeCtion 2: FiscOII and Physical Resources:> 2.05 Travel


            Administration & Operations Manual
            2.05 Travel
            Last Revised: 16 May 2008
            Refer Questions To: Coordinator, Administrative Services, A & F

            Scope

                  This policy applies to faculty, teachers, and staff in all offices and divisions of Gallaudet University.

            Policy

                  Gallaudet University reimburses faculty, teachers, and staff for travel expenses incurred while on
                  official University business as long as the travel and expenses are: (1) consistent with the institution's
                  overall mission; (2) within budgetary limitations;· (3) cost effective; (4) reasonable; and (5) in
                  compliance with the TRAVEL AND ENTERTAINMENT GUIDELINES as approved by the President and
                  appended to this policy.

                  Travelers are expected to select the lowest possible fare for official travel whenever possible.
                  Overnight accommodations must be in moderately priced lodging facilities. Expenses for meals
                  consumed while traveling on official University business are reimbursed at the per diem rates
                  established in the TRAVEL AND ENTERTAINMENT GUIDELINES. Complimentary meals provided on air
                  carriers or meals included in the cost of a conference are not reimbursed.

                  Travelers requiring the use of an automobile at their destination are reimbursed for the cost of the
                  rental. Travelers should select a compact class automobile unless group travel requirements dictate
                  otherwise. Employees using their personal automobiles are reimbursed at the per mile rate
                  established by the IRS.

                   other related expenses incurred while on official University business are reimbursed at actual cost,
                   e.g., taxi fares, tolls, parking, reasonable hotel tips, business-related telephone charges, and currency
                   exchange. Personal expenses, such as luggage, traffic fines, gifts, club dues, travel insurance (other
                   than for rental cars), in-room movies, personal entertainment, airline clubs, baby-sitting fees,
                   clothing, and personal automobile repairs are not reimbursable. Spouse travel expenses are not
                   reimbursed unless the spouse is on official University business and unless the travel is approved in
                   advance by the administrative officer.

                   An expense advance may be provided to the traveler based on the estimated cost of the trip. Upon
                   return, faculty, teachers, and staff must submit an accounting of expenses to the Finance Office.
                   Expenses exceeding the advance will be reimbursed.

                   Failure to comply with this policy and with the TRAVEL AND ENTERTAINMENT GUIDELINES may be
                   cause for delay or non-reimbursement. Additionally, faculty, teachers, and staff with outstanding
                   travel advances may be subject to payroll deductions.

            Approved by: Gal/audet University Administration

            Guidelines

                   TRAVEL AND ENTERTAINMENT GUIDELINES

                      1. USE OF THE TRAVEL AGENT
                         Gallaudet has an agreement with a local travel agency to assist faculty, teachers, and staff with
                         arranging travel requiring the use of scheduled carriers, overnight lodging, and/or car rentals.




       httn:l/2:allaudet.edulaf/ao s205.xml                                                                                                 3/17/2009
                                                                                                     
                                                                           Attachment I  ­ Page 1


                                                                                                     
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                         Control Number ED-OIG/A03I0009




        Administration & Finance - 2.05 Travel- Gallaudet University                                                                Page 2 of4
                                                                                  Gallaudet University
                                                                                  Response to Finding Other Matters- "Reimbursement of Travel Expenditures"
                                                                                  Attachment IX
                        The travel agency offers GSA fares and bills the University directly for scheduled carrier
                        transportation charges. The agency charges a fee for Its services. G~lIaudet travelers ~Iso h~ve
                        the option of using an online reservation system or other travel agencies if doing so provides
                        the best possIble rate. Payment when not using the travel agent should be made with a
                        GaiJaudet purchasing C21rd.
                   2. TRAVEL APPROVAL
                        If reservations are made through the University's travel agency, or if a travel advance is
                        requested, a tr21vel order must be approved in advance by the unit administrator. International
                        travel must be approved by the administrative officer. Tickets purchased from the University's
                        travel 2lgency are not released unless an approved travel order is on file in the Finance Office
                   3. TRANSPORTATION FARE SELECTION
                      When traveling on official University business, faculty, teachers, and staff should select the
                      lowest logical coach fare to their intended destination whether by air, rail, or bus. The
                      University's travel agent uses GSA schedules and fares whenever possible. Travelers are not
                      expected to use GSA schedules and fares if space or scheduled flights are not available in time
                      to accomplish the purpose of the trip, or if the use of the service would require the traveler to
                      incur unnecessary overnight lodging costs. Additionally, a non-GSA carrier, an alternate travel
                      agency, or an online reservation system may be used if it offers a fare and service fee that
                      would result in a lower trip cost. Travel being funded by a Federal grant requires the traveler to
                      use a U.S. air carrier and comply with OMB Circular A-21 and the Federal Travel Regulation
                      requirements.
                   4.   PERSONAL AUTOMOBILE
                        At times it may be more convenient for travelers to use their personal car instead of scheduled
                        carriers. The University reimburses actual mileage from home or office, whichever is less, and
                        return at a per mile rate based on IRS regulations. The University may reject claims for mileage
                        expenses that exceed the lowest logical coach fare available at the time of the trip. A record of
                        the beginning and ending odometer readings should be recorded on the travel voucher.
                        Estimated total mileage is not accept21ble.
                   5. LODGING SELECTION
                        Travelers should select accommod21tions from moderately priced properties. Preference should
                        be given to facilities that offer preferred rates to the University, unless the location is
                        inappropriate for the purpose of the trip. For example, when attending seminars and
                        conventions, travelers may st21Y at the facility hosting the meeting. Travelers are not required
                        to share accommodations. However, reimbursement will not be made for hotel accomodations
                        less than 50 miles from Gallaudet.
                   6. VEHICLE RENTAL
                        Gallaudet asks travelers to conserve institutional resources when renting a vehicle for business
                        travel. Travelers should rent a personal car, unless the requirements of a group dictate
                        otherwise, and an inexpensive compact-size car if possible. Travelers who need a large or
                        luxury vehicle with a value exceeding $35,000 must notify the Office of Risk Management and
                        Insurance prior to the trip. Also, travelers should make sure to understand the company's
                        refueling policy and select the option that has the least expense to the University.

                        When traveling for Gallaudet University, faculty and staff should check their departmental
                        guidelines before purchasing insurance from the rental car company. Gallaudet carries liability
                        insurance to protect the institution and its employees, and it carries physical damage coverage
                        that pays to repair the rental vehicle. Travelers are encouraged to get an Insurance card from
                        the Office of Risk Management and Insurance prior to the trip. However, rental companies often
                        impose "loss of use" and other administr21tive fees if the rental vehicle is Involved in an
                        accident. The department sponsoring the trip is responsible for any costs or fees not covered by
                        Gallaudet's insurance, and It can opt to either: (a) purchase additional insurance offered by the
                        rental company, or (b) directly pay any uninsured costs or fees from the departmental budget.
                   7.    PER DIEM MEAL RATES

                                                                       Standard Per Diem Meal Rates
                                                             Breakfast                   $ 8.00
                                                             Lunch                       $10,00
                                                             Dinnl!r                     $24.00
                                                             Daily Total                 $42.00



                         Per diem expenditures are at the discretion of the traveler, but no expenses in excess of the
                         allowable per diem will be reimbursed. Travelers are not eligible for a diem allowance if the




         htto:llgallaudet.eduJaf/ao s20S.xml                                                                                          3/17/2009
                                                                                               
                                                                     Attachment I  ­ Page 2


                                                                                               
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                 Control Number ED-OIG/A03I0009



           Administration & Finance - 2.05 Travel - Gallaudet University                                                         Page 3 of4
                                                                           Galiaudet University
                                                                           ResPonse to Finding Other Mat!ers~ "Reimbursement of Travel Expenditures"
                                                                           Attachment IX

                           travel is less than 50 miles from Gallaudet University. Tips are included in the per diem rates.
                           Meals provided in conjunction with seminars and on transportation carriers may not be claImed
                           as part of the per diem allowance. Breakfast or dinner per diem expenses are not honored if
                           travel begins after 9 a.m. or ends before 6 p.m. respectively. Travel being funded by a Federal
                           grant will be eligible for the per diem allowance established by the University.
                     8.    OTHER REIMBURSABLE EXPENSES
                           The following travel related expenses are reimbursable: taxi fares and airport limos, parking
                           charges, tolls, gasoline for rental cars, baggage handling tips, excess baggage charges for
                           University equipment, business~related telephone charges, currency conversion charges, and
                           other incidental expenditures incurred while on business travel. These expenses must be
                           recorded on the travel voucher and supported by receipts whenever possible.
                     9.    NON~REn"BURSABLE EXPENSES
                           The following expenses are not reimbursable: hotel accommodations and per diem allowances
                           for travel less than 50 mlles from Gallaudet, the purchase of luggage, personal excess baggage
                           charges, traffic fines, gifts, club dues, travel or flight insurance, in-room mOVies, personal
                           entertainment, airline clubs, baby-sitting fees, check cashing charges, clothing, and personal
                           automobile repairs, maintenance, and gasoline. Alcoholic beverages are not reimbursable from
                           the University'S Federal appropriation. Spouse travel is not reimbursable unless the spouse is
                           traveling as a representative of the University and the travel is approved in advance by the
                           administrative officer.
                    10. INSURANCE
                        Worldwide flight insurance is provided with each ticket issued to University employees by the
                        travel agency. Online reservations paid witll a University purchase card are insured through the
                        card issuing company. Gallaudet does not reimburse additional insurance costs incurred by the
                        traveler such as personal flight insurance and personal accident insurance. Additionally,
                        Gallaudet assumes no l1abllity for damages or other losses that may occur during travel.
                    11. INBOUND TRAVEL
                           When inviting guests to campus at Gallaudet's expense, employees can use the services of the
                           University'S travel agency to make arrangements. Online reservations can be made and paid for
                           through the University purchase card.
                     12. SPONSORED TRAVEL
                           In cases where travel is at the expense of another organization, the traveler should recognize
                           his/her obligation to minimize expenses. Travelers may make arrangements In compliance with
                           these guidelines and invoice the hosting organization. Upon receipt of payment, the check
                           should be deposited in the Cashier's Office to the traveler's department account. Travel being
                           funded by a Federal grant are required to comply with OMB Circular A-21 and the Federal
                           Travel Regulations requirements.
                     13. RECEIPT REQUIREMENTS
                           Only expenses actually incurred are reimbursed. Original receipts are required for all expenses
                           except for per diem meal costs. Receipts should be detailed vendor receipts rather than the
                           more general charge transaction slips. The last original copy of the airline, rail, or bus ticket
                           must be attached to the travel voucher. Reproduced copies are not acceptable. Travelers must
                           return all unused tickets with the travel voucher for credit.
                     14.   EXPENSE ADVANCES
                           An expense advance will be issued to the traveler when an authorized travel order, detailing
                           estimated expenditures for the trip, is submitted at least one week in advance to the Finance
                           Office. Advances are made to Gallaudet personnel only. The advance is calculated based on the
                           appropriate per diem meal rates and estimated out~of-pocket expenses to be incurred by the
                           traveler. Scheduled carrier transportation expenses are billed directly by the travel agency or
                           are charged to the University purchasing card.

                           The minimum advance is $100. Petty cash travel advances are prohibited. Advances are dIrect
                           depOSited whenever possible. Advances are not given to employees wIth past~due travel
                           vouchers.
                     15.   REGISTRATION FEES
                           Advance registration fees for seminars and conventions should be paid by University purchasing
                           card.
                     16. EXPENSE REPORTING
                           All expenses incurred must be recorded on a trave! voucher. Upon return from a trip, a
                           completed travel voucher must be submitted to the Finance Office within five working days.
                           Travel vouchers must be approved by the unit administrator. Reimbursements are processed
                           within five working days and are direct depOSited to the traveler's account whenever possible.
                           Rpfllnrl<; frnm trill/pj ilnVilnrp<: ml,<:t "rrnmn<1nv thp tr<1l1pj vnllrhpf Tr"vpjpr<; m<1V nnt pndn<;p




           htto://gallaudet.eduJaf/ao s205.xml                                                                                        311712009
                                                                                                
                                                                Attachment I  ­ Page 3


                                                                                                
Gallaudet University’s Internal Controls
Over Federal Funds                                                                                    Control Number ED-OIG/A03I0009




        Administration & Finance ~ 2.05 Travel- Gallaudet University                                                           Page 4 of 4
                                                                             Gallaudet University
                                                                             Response to Finding Other Matters- "Reimbursement of Travel Expenditures"
                                                                             Attachment IX

                        cash with the travel voucher. If necessary, cash refunds should be deposited in the Cashier's
                        Office, and the cash receipt attached to the travel voucher. All unused tickets that were
                        purchased through the University's travel agency must be returned with the travel voucher for
                        credit.
                  17. UNIVERSITY VEHICLES
                      University vehicles are available for official regional travel. Requests for University vehicles
                      must be approved by the appropriate unit administrator and received by the Transportation
                      Department a minimum of five working days prior to the trip. Transportation forms and
                      procedures can be found on the Transportation Department's web page.
                  18. ENTERTAINMENT
                      All entertainment expenditures must be approved in advance by the unit administrator and/or
                      senior administrator. Prudence should be exercised when entertaining guests of the University
                      whether in Washington, D.C. or out of town. Only actual costs are reimbursed. Meals are
                      reimbursed at the scheduled per diem rates, unless otherwise authorized. Alcoholic beverages
                      are not reimbursable from the University's Federal appropriation.
                  19. MEETING ARRANGEMENTS
                      Gallaudet's travel agency is able to offer assistance in planning sponsored meetings,
                      negotiating preferred rates for accommodations, and securing special transportation discounts,
                      etc.
                  20. SPOUSE TRAVEL
                      Occasionally spouses are asked to travel on official University business. A separate travel order
                      must be completed for University-sponsored spouse travel.
                  21. BUSINESS AND PERSONAL TRAVEL
                      In instances where a traveler interrupts business travel for personal convenience, travels by an
                      indirect route, or is accompanied by his/her spouse not on University bUSiness, the traveler
                      must maintain accurate records for official.business travel. The University does not reimburse
                      any expenses incurred on behalf of the spouse or for personal travel.
                  22.   ACCIDENTS
                        Any accident, injury, or threat of litigation that occurs during business travel should be reported
                        to the Office of Risk Management and Insurance within 24 hours. This includes: (a.) an Injury to
                        the employee traveler; (b) an injury to a student or volunteer traveling with the employee
                        travelers; (c) an injury (physical or alleged violation of civil rights) sustained by someone who
                        claims that it was caused by an employee of Gallaudet University; and Cd) any other
                        misunderstanding, alleged breach of contract or promise, or other threat or incident that might
                        result in litigation. Under no CirCUmstances should a traveler admit l1abil!ty or fault on behalf of
                        the University nor should he or she compromise the University's ability to defend against any
                        claim in any way. If travelers are uncertain as to the reporting requirements, they should err on
                        the side of making a report to the Office of Risk Management and Insurance.




         httn:lleallaudet.eduJaf/ao 3205.xml                                                                                      311712009
                                                                                             
                                                                   Attachment I  ­ Page 4