LIFEBRIDGE HEALTH

Finance DivisionProtocol Research Projects

Policy ManualPage 1 of 2

LIFEBRIDGE HEALTH FINANCE DIVISION POLICY MANUAL

Policy : Protocol Research Projects

Purpose:To establish a consistent methodology and practice of recording ARB/IRB approved research projects.

Policy:All cash and expenses will be allocated to a protocol cost center so that expense and cash receipts can be reconciled.

Procedure:Each protocol will be given an ARB number to identify and track receipts, expenses, and profit/loss of each research protocol. The Division of Finance will complete the budget form (Attachment 2) based on the information provided in the ARB application. The budget form will delineate direct/indirect expenses as well as department fees for each protocol along with payment terms for the research. Profits will be the property of the home department once the research has been completed. For multi year studies profits may be distributed to the home department as mutually agreeable by the home department and division of finance.

Once the ARB application has been approved and expenses and terms of payment have

been delineated, a letter of approval and terms of payment will be sent to the principal

investigator for his/her acknowledgement and assent. Once all signatures are obtained on

the approval letter of the ARB (Attachment 3), research may commence.

Example:The principal investigator will submit the ARB Protocol Finance Form (Attachment 4) indicating the number of patients enrolled in a particular research program. For example, a protocol for cancer research generates $1,000 per patient; five patients are enrolled for the month of July. A check for $5,000 has been received.

Breakdown of $5,000:

Dept.Cost Center

(500)Cat scannerRadiology7800

(500)PharmacyPharmacy7400

(1000) NursingNursing7680

(250)Overhead 5% hospitalFinance6120

(250)Overhead 5% departmentCancer Ctr.7680

(2500)Total Direct & Indirect expenses

5000Cash Received

2500Residual

Coding of Check:Protocol cash receipts will be coded to the protocol cost center, protocol recovery account and protocol activity number. See example:

1000-8600-657500 ARB1

company, cost center, account number, activity number

Coding of Expenses:Protocol expenses will be coded to the grant cost center, protocol expense account and protocol activity number. See example:

1000-8600-510180 ARB1

company, cost center, account number, activity number

Process:

  1. On a monthly basis and per protocol, the principal investigator or the designee will complete the ARB Protocol Finance Form (ARBPFF), marked as Attachment 4, and submit this form to finance no later than the third business day of every month for the activity provided/conducted for the previous month. Maintain a photocopy of ARBPFF for the department’s file and submit a copy to their respective department.
  1. Finance will then abstract the data from the ARBPFF and calculate the expense for the protocol cost center and record a journal entry reflecting the activity. This will ensure that the individual departments who participate in the project will receive immediate reimbursement. See example:

DebitCreditDept.Account Coding

Protocol Grants2500ARB1000-8600-510180ARB1

Cat Scanner500Rad.1000-7800-510180ARB1

Pharmacy500Pharm.1000-7400-510180ARB1

Nursing1000Nursing1000-7680-510180ARB1

Overhead 5% hospital250Finance1000-6120-510180ARB1

Overhead 5% department250Can. Int.1000-7680-510180ARB1

  1. The finance department will record the expenses each month in order for the individual departments who participate in the research projects to receive immediate reimbursement. The department will see a credit on its monthly financial report on the protocol recovery line. See above for account number.
  1. When a department receives a check, for example, the $5,000 check mentioned above, the department director/representative will code it as follows: 1000-8600-657500-ARB.

The following journal entry is made:

DebitCreditAccount Coding

Cash50001000-BS-111000ARB1

Protocol recovery50001000-8600-657500ARB1

  1. Every six months or at the end of a project, whichever occurs first, a reconciliation will be performed to determine the amount of residual dollars that are available. At this point the dollars will be transferred to an agreed upon account for the department to access the funds.
  1. The ARB reserves the right to impose a 10% interest charge to the principal investigator for failure to collect the research funds from the funding source after a 30-day period. After a 60-day period the Director of Finance reserves the right to call the funding source for payment recovery. After 75 days, if payment is not received, the ARB has the right to terminate research.

ARB Coding Policy Finance

Approved 10/23/2002

1