Moving Forward

Scott and O'Brien say they expect the Med School audit to be tied up in one package with the $2.2 million still to be negotiated from the School of Public Health audit, but will not comment further on the state of the negotiations. But another official, Harvard's chief federal lobbyist Parker L. Coddington, says that the negotiating process is "making its way towards a quite acceptable conclusion."

One reason for Harvard officials' tough stand is--not surprisingly--another audit, this one an experimental audit conducted by the University's private accountant, Coopers and Lybrand.

Last year, Coopers completed the audit conducted of all the research money the University received in 1978, for all departments and schools. The certified public accountants found that Harvard accounted correctly for about 98 percent of the money, with "no fraud, abuse, or diversion of federal funds."

More to the point, O'Brien says, the type of cost transfers disallowed by the HHS auditors were found to be "appropriately made" by Coopers.

O'Brien also pointedly brings up Coopers's finding that Harvard didn't charge the government nearly $3 million it could have for certain salaries of faculty members working on federal projects. O'Brien adds that in one particular contract--which he won't specify--a good argument can be made that Harvard overcharged the government by $1.5 million.

Harvard is not trying "to conceal the fact that there's a lot of money they can claim with a lot of strength," he adds. But O'Brien stresses these have to be contrasted against the money Harvard is not claiming from the federal government.

As the garrulous financial vice-president states: "I'll argue that the preponderance of evidence on 99 percent of that is in our favor."

O'Brien concludes that "some improvements in our systems" ought to be made, but he resolutely maintains Harvard doesn't owe the government anything, as far as the Med School is concerned. "We think our interpretation will prevail, but I don't know."

Meanwhile O'Brien and officials in Washington stew over the harm the disputes have on the higher education-federal relation. The audit problem has "probably been the leading cause of damaging what was heretofore a fairly cordial relationship," Goldberg flatly states.

Harvard officials emphasize as well that the auditing system cannot be made 100 percent accurate, that the cost of making no errors is prohibitive.

The University's goal, O'Brien emphasizes, is "not to apply a very sharp pencil to our dealings with the federal government," but to advance research at reasonable rates.

"Harvard does not want to defraud the federal government," O'Brien adds emphatically.