Today’s universities are facing declining enrollment and tuition numbers. These universities are competing with major state schools and forced to do more with less.
Larger campuses and universities are left with an extreme amount of spend, making it critical they get the best value. Most of this spend is on research, and often times is grant based. Controls and reporting around grants are essential for universities to understand. For instance, if an expense is misclassified, it cannot simply be changed from one category to another. Compliance is more complex, and a university could risk losing their grant if they do not manage it correctly.
All universities have various schools, and they try to allow these schools to run independently, and typically, top administrative levels have contracts in place. However, there is little communication in those contracts down to the individual school.
Often times, senior leadership sees a contract being negotiated by the centralized procurement function, but they are not really monitoring spend of the various schools. They see one high-level number, not the unit cost. It’s crucial that concerns are brought to their attention so they know there are savings issues at risk. Unfortunately, senior leadership is not aware of the extent of these problems and the frequency of overspend.
That’s why grant compliance is vital. Universities must understand and support all of the requirements of the grant. There could be limitations to how the money is spent and what is being charged to that grant.
There are ways colleges and universities can adhere to grant compliance, and one major adjustment is administering a grant compliance database. More often than not, individual schools are tracking details of grants. There should be a shared services and shared technical environment where you have abstracts of all the grants so you have the ability to look at the details of the grant.
A grant compliance database allows for various types of charging categories. It also allows for exception reporting so that management can identify if there is any exception to the grant.
Developing an environment where everyone has visibility and transparency into the grant and its details would minimize risk and compliance oversights for colleges and universities.
If you have any questions or concerns about your university or college’s grant compliance, please contact us today.Categories: Podcast, Consulting, Higher Education