The National Health and Medical Research Council (NHMRC) Funding Agreement and the Medical Research Future Fund (MRFF) Funding Agreements require administering institutions and MRFF eligible organisations to submit Annual Financial Statements and a Financial Acquittal Statement for each grant.
NHMRC has migrated basic grant data from RGMS to Sapphire as part of the transition for grant management from RGMS to Sapphire. Additional data will be migrated to Sapphire as outlined on Sapphire Help, under 'Select and Post Award'.
RGMS users are no longer able to access RGMS. Interim arrangements for the submission of financial statements will apply until financial reporting capability is available.
Interim arrangements for financial reporting
All reports that were accepted by NHMRC or at the status of 'submitted to NHMRC' in RGMS will be migrated to Sapphire and handled as follows:
- Unless advised otherwise financial acquittals and annual statements that were submitted to NHMRC in RGMS, and not returned or cancelled will be considered 'met'.
- For Financial reports that may be reviewed offline by NHMRC, NHMRC will advise administering institutions (AIs) and MRFF eligible organisations (MRFF EOs) of any reports that will need to be revised and resubmitted.
- Reports received, but not accepted, by NHMRC will show a milestone as overdue.
When AIs are advised that Sapphire is available for uploading financial reports overdue reports should be prioritised for submission.
Financial reporting of 2021 expenditure
AI Financial Officers have been provided instruction on how to lodge 2021 Financial Reports outside the grants management system.
Overdue financial reports, Certified Annual Financial statements for 2021 expenditure and Final Acquittal statements for research activities with an end date in 2021 are to be submitted via email using the financial report template provided to email@example.com by .
Overdue reports should be prioritised for submission.
Sapphire financial reporting – forthcoming changes
Several key changes to the financial reporting process are outlined below to assist AIs and MRFF EOs prepare for when financial reporting functionality is available in Sapphire.
- Financial reporting templates will be downloaded from Sapphire, not from the NHMRC website. The template will continue to allow bulk upload.
- The template is to be downloaded by report type: Annual Financial Statement, Transfer Acquittal, and Financial Acquittal.
- The template download will include a combination of pre-populated fields and fields for AIs and MRFF EOs to enter their expenditure data.
- Sapphire will calculate fields that are based on information in system (Grant identifier; income = grant funds paid; balance brought forward = previous year final result etc.).
- Financial reports will only be able to be uploaded in sequential order. That is, the previous year's financial report must be submitted before the following year's report becomes available as:
- Information will only download into the template for grants that have had the previous financial statement submitted
- If there are outstanding annual financial reports, these need to be successfully submitted before a Financial Acquittal Statement will be available to download.
Financial expenditure categories/ items have changed
NHMRC took the opportunity to adjust the reporting template to align more closely with the current grant program. Recognising that grants awarded under the previous grant program are still active, fields for older, legacy grants are still available but are intended to be scheme specific.
When financial information is migrated into Sapphire it will be aligned with the new expenditure reporting fields. All expenditure reported in historical and 2021 financial reports submitted offline will be mapped by NHMRC to the revised Sapphire expenditure categories as part of data migration when Sapphire financial reporting functionality is deployed.
Expenditure is mapped consistent with the relevant funding rules/ grant guidelines and the DRC Guidelines where relevant. Previous Financial Summary statement information, as provided, has been retained on file.
NHMRC has provided further detail by email to the financial officers of the AIs and MRFF EOs on the changes to expenditure categories including an example template.
Guidance to assist finance officers on how to upload Financial Statements through Sapphire will be provided in due course and will be made available on Sapphire Help.
Financial Acquittal Statement
Acquittal refers to the process of assessing and reconciling the final Financial Statement at the conclusion of the funding or after the transfer of a grant to another AI and/or MRFF EO. This process enables NHMRC to ascertain whether the AI and/or MRFF EO has satisfied their obligations to manage the funds as required by the Funding Agreement. The total funding received for the duration of a grant must be reported on a year-by-year basis.
NHMRC's grants management system facilitates this reporting by building the financial reporting history of a grant as each year's financial information is submitted in system. NHMRC will raise an invoice to recover any unspent MREA funds at the end of the Funding Period. The Department of Health will raise an invoice to recover any unspent MRFF funds at the end of the funding period. AIs and MRFF EOs are to return unspent funds on receipt of the invoice.
Financial Acquittal Statements will not be accepted with a negative balance.
Submission of reports
Report submission will return to standard submission timeframes for 2023 Annual Financial Statements.
The Annual Financial Statement must be submitted to NHMRC by following each calendar year of funding. A Financial Acquittal Statement must be submitted to NHMRC no later than six months after the funding period has been completed, or six months after termination of a grant, or one month after the transfer of a grant. Failure to provide the report(s) within agreed timeframes will result in consideration being given in accordance with the Funding Agreement to suspending payments to all active grants held by the AI or MRFF EO until the report(s) have been submitted.
The Chief Financial Officer (or delegate) of the AI or MRFF EO must certify that the accounts and records underlying the Financial Statements have been maintained in accordance with Australian Accounting Standards and the Responsible Officer (or delegate) must certify that all funds provided for that research activity have been used for that research activity in accordance with the terms of the Funding Agreement.
Unspent funds and extensions to the funding period
If it is anticipated that the research activity will not be completed in the approved funding period, a variation to extend the grant must be submitted to NHMRC, before the end date of the grant. Late extension requests submitted after the existing end date of the grant are unlikely to be approved.
Scholarship Financial Acquittal reporting
The process for acquitting a Scholarship (PhD or Masters) at the end of the approved funding period is identical to other grants. However, the $500 thesis allowance should be shown as spent in the acquittal. No financial report is required from an AI when the thesis is subsequently paid to the scholar as the funds have already been acquitted. Where there are unspent funds, other than the thesis allowance, at the time of the acquittal, these must be disclosed in the final year Financial Acquittal Statement and will be recovered by NHMRC.
ARMS Post Award (Finance) Workshop
NHMRC presented an update on Sapphire developments as part of a Post Award (Finance) Workshop hosted by the Australasian Research Management Society (ARMS) on 1 November 2021.
The workshop was delivered in two components:
- Part 1 of the workshop provided an overview of the key principles and expectations of AIs and MRFF EOs in managing grant funding under the NHMRC and MRFF Funding Agreements, the role of the Chief Financial Officer and the Finance Officer, and expenditure of grant funds and NHMRC Direct Research Cost Guidelines interpretation.
- Part 2 of the workshop provided an overview of NHMRC's new grants management system, Sapphire, and post award functionality being deployed. Further advice will be provided once Sapphire financial modules have been deployed.
A video recording was made of the presentation and is available for viewing.