MEMORANDUM
February 20, 2003

TO:  NAVREF Members
FROM:  Barbara West, Executive Director
SUBJECT:  Annual Reports Due on June 1, 2003

The June 1 deadline for NPC annual reports to VA is approaching.  Last year, there was a significant improvement in the timely submission of the annual reports and the completeness of the information they contained.  Congratulations to all.  However, we encourage all NPCs to again recognize the seriousness of the June 1 deadline and to start taking steps now to ensure compliance in 2003.

The annual report form and spreadsheet for the 2003 annual reports is the same as for 2002.  The only change is that reports from research NPCs should be submitted to the new NPC Program Office being established by the Office of Research and Development in response to congressional and IG requests that VA collect more data about the NPCs and their activities.  Please submit reports as follows:

§         Research corporations – submit report to NPC Program Office
§         Corporations that conducted both research and education activities during their last completed fiscal year – submit report to NPC Program Office and send a copy to the Office of Academic Affiliations
§         Education only corporations – submit report to Office of Academic Affiliations

In accordance with the above, on or before June 1, 2003, please submit your report to:

NPC Program Office (12B)
Office of Research and Development
Department of Veterans Affairs
810 Vermont Avenue, NW
Washington, DC  20420

Mr. Andy Fleshman
Office of Academic Affiliations (144)
Department of Veterans Affairs
810 Vermont Avenue, N.W.
Washington, DC 20420

The report instructions and format for research and education NPCs are provided in Appendices A and B of Handbook 1200.17.  Education only NPCs should go to Appendix A of Handbook 1400.2.

Use the report format to ensure that all required documentation is enclosed and that the financial data is reported accurately.  Verify numbers against IRS Form 990 where appropriate.  NAVREF has posted on its web site an Excel spreadsheet developed by Mary Thornton, dorector of sponsored research at the Palo Alto Institute for Research and Education (PAIRE), to provide NPCs with a tool to make sure that their annual reports are complete and accurate.

Reminder:  The following is the ORD position on annual report submissions:

1.       VHA Handbooks 1200.17 and 1400.2, Appendix A, details the annual reporting requirements for each VA nonprofit research and education corporation.  Annual reports must be submitted to the designated VA point of contact on or before June 1.  The June 1 deadline is mandatory and not negotiable.

2.       Every VA nonprofit established under 38 USC 7361 that has completed incorporation by the state in which it is located must submit an annual report regardless of whether the nonprofit has been granted IRS tax exempt status or has received or expended funds during the previous year.  The annual report should reflect activity conducted during the nonprofit’s last completed fiscal year.

 5.       Research corporations should notify John A. Bradley, ORD Chief Financial Officer (12B) (john.a.bradley@hq.med.va.gov) of any issue that may affect compliance with the reporting deadline together with a corrective plan of action.   Education only NPCs should contact Andy Fleshman.  Email: andy.fleshman@hq.med.va.gov

 6.       Standard nonprofit practices require that audit reports be reviewed by the Boards of Directors.  If deficiencies are noted, the board should document appropriate corrective measures to ensure that the same deficiencies will not be noted in subsequent management letters.

Please note:  During a review last year, it was noted that the reporting requirement contained in Handbooks 1200.17, Appendix A, Item 5, was inconsistent with the NPC authorizing statute and provision 9.b.(2)(e)4 of the handbook.  To achieve consistency, ORD has asked General Counsel to revise this provision and the one provided in Item 7 of Appendix B.  For purposes of the reports due June 1, 2003, ORD supports following this requirement as revised:

Appendix A, 5. A list that identifies each non-governmental funding source whose total contributions for the year exceed $25,000; provide name, location and total dollar amount.

The revised provisions are highlighted on the linked versions of Appendices A and B.