Part I - Overview

Section A: General Overview

Quality assurance and validation of TRAC

42. The Government has accepted that TRAC is a robust costing method. TRAC specifies standards, principles and conventions that must be used when costing in HEIs, based on audited accounts of institutions; and has defined sets of minimum mandatory requirements to ensure that costs are fair and reasonable, and are calculated in a consistent manner across the sector. The conclusions of the FRACG review confirm this.
43. The quality assurance (QA) and validation processes included in TRAC (covering both annual TRAC and TRAC fEC) include:
    • internal verification of data (e.g. time allocation) and validation and testing of cost drivers; reconciliations, reviews and tests for reasonableness; audit trails; methods to avoid double-charging;
    • internal audit review of methods, planned on a risk-based approach, but including a full systems audit; with an institutional Committee confirming compliance;
    • requirements to supply information for benchmarking on a comparable basis, and to justify indirect cost rates and estates charges that are above the upper quartiles of the sector.
44. Additional quality assurance was provided through an external QA process carried out in 2004/05 that focussed on annual TRAC and the readiness for TRAC fEC. Every institution was visited by an external QA team who assessed the robustness of their TRAC methods and examined a self-certification proforma and benchmarking information provided by the HEI. If significant issues were identified then institutions had to address these before they could apply their own indirect cost rates and estates charges to publicly-funded research projects. If they cannot address these then they have to apply default charge-out rates set by Government.
45. In addition, Research Councils use dipstick testing to help satisfy their accountability requirements. Other research sponsors have started to participate in this established process.
46. Institutions need to be reassured that there is a level playing field, and that other HEIs’ costs are as robust as their own. And funders need to know that they can rely on the TRAC costs as a basis for funding.
47. External QA processes will continue in the future to provide this reassurance. A major review of this was commissioned by the Research Councils and Funding Councils in 2005. This will join up all of the various strands of QA activity that currently take place and that should take place, to meet the probity requirements of sponsors, and institutions’ own needs.