Don’t Let Subawards Sink You!

Judy Krzyzek & Karen SachiOffice of Sponsored Projects

Administration

What makes a transaction a subaward?

• A defined portion of the Statement of Work is assigned to another entity

• Work performed by subrecipient’s personnel using their resources

• Subrecipient takes full responsibility for completing the assigned work, including intellectual leadership

• Subrecipient must comply with the terms of the prime award

Other Purchasing Actions• Provide goods and services as part of normal

business

• Provide similar goods and services to others

• Operate in a competitive environment

• Goods and services are ancillary to the sponsored project

• Will not be subject to the terms of the prime award

PI Evaluates Potential Subrecipients

How is the subrecipient selected?

• Past performance• Technical/financial resources• Proposed scope of work• Reasonableness of proposed costs

PI/Department Prepares the Proposal

• Integrates the subrecipient’s statement of work and budget into U of M’s proposal

• Obtains signed commitment from proposed subrecipient’s research office

• Provides sole source justification (required for federal contracts)

• Provides other forms required by sponsor

SPA Reviews Proposal• Verifies subaward is the appropriate mechanism

• Reviews budget (F&A, cost sharing)

• Verifies proposal documents are provided (e.g. written commitment from institution)

• Verifies proposal complies with sponsor and University policies

• Endorses and submits the proposal

Information needed from Departments to Issue a

Subaward• Collaborator and contact

information • Statement of Work• Budget, including

cost sharing commitments (if applicable)

• Technical/financial reporting requirements

• Payment terms/schedule(if applicable)

• Period of Performance• Verification that

subrecipient is compliant with IRB, IACUC, approvals (if applicable)

• Sole source justification (if applicable)

• Cost/price analysis• FFATA data (if

applicable)

FFATA: Federal Funding Accountability and Transparency Act

• Searchable website for the public to identify funding by data elements. Public must be able to:– Ascertain amount of federal funding awarded to an entity– Download results of search

• Award data must be available by Jan 08 (Feds)• Subaward data must be available by Jan 09

(Us) • Data elements:

Entity NameNAIC or CFDA#

Funding AgencyTransaction Type

Award $

Location of Entity

DUNS # of Parent

DUNS#

Program Source

Primary Performance Location

Title

Data Elements• Name of Entity Receiving Award – Official, legal

name registered in DUNS and CCR.• Award Amount – Federal award amount.• Transaction Type – Loan/cooperative

agreement/contract/guaranteed loan, etc.• Funding Agency – The Federal agency you received

the grant money from.• NAIC – Not applicable to grants.• CFDA No. – CFDA number assigned to the program.• Program Source – [This code is not applicable to

non-Federal entities. The Federal government assigns and uses this code internally.]

• Award Title Description with the Purpose of Each Funding Action – Aside from the general Federal definition, this field is used to further define the award.

• Location of Entity Receiving the Award – Self explanatory (city, state, congressional district, country).

• Primary Location of Performance – Provide the primary location where the work is being performed (city, state, congressional district, country).

• Unique Identifier of Recipient – DUNS +4.• Parent ID – DUNS

Potential High Risk Indicators • A qualified audit report, or failure to have a current audit report• Inadequate response to a financial questionnaire• History of non-compliance• History of non-performance or failure to use funds for their

authorized purposes• New subrecipient (or new to this type of project)• New personnel or systems• Large subaward/large percentage pass through• Award size relative to subrecipient’s sponsored research portfolio• Criticality to overall success of pass-through entity’s project• Subrecipient in a remote location• Type of subrecipient (is the subrecipient already subject to A-133)

Monitoring Responsibilities: PI/Dept

• Understands terms and conditions of subaward agreement

• Serves as primary point of contact for the Subrecipient

• Monitors scientific progress

• Verifies that the Subrecipient is meeting cost sharing commitments

• Verifies compliance approvals are current for subrecipient’s portion of statement of work (human subjects, animal subjects, biosafety)

• Personally approves invoices for payment

– Ensures all costs are allowable, allocable and reasonable

– Ensures all costs were incurred within the period of performance of the subaward

– Confirms that expenses are aligned with technical progress

Monitoring Responsibilities: SPA

• Assists PIs with monitoring subawards

• Reviews annual audit reports

• Verifies corrective action plans are implemented (if necessary)

• Reviews risk levels and, if necessary, modifies subaward agreements

• Verifies invoices are signed by PIs, costs incurred within dates, amounts, and pursuant to terms of subaward

Modifications and Terminations

PI/Dept:• Assesses need to modify

statement of work, budget, period of performance

• Works with SPA in a timely manner to arrange amendment

• Provides information to SPA (budgets, dates, reporting requirements, etc.)

• Assists SPA in negotiating changes, if needed

SPA:• Prepares amendment• Negotiates changes• Modifies the

encumbrance in the financial system (if any)

Planning for Closeout: PI• Checks status with subrecipient 90 days before

end (best practice)

• Follows up on late or missing reports or deliverables

• Obtains final invoice (marked FINAL)

• Sends copy of final invoice to SPA

Processing Closeout: SPA

• Reviews and processes payment of final invoice

• De-obligates commitment for subrecipient agreement (if necessary) in financial system

• Audits subaward (if necessary)

On the Horizon• Web-based forms and resources

• Sole source justification requirement

• Enhanced subaward database (SPA)

• Increased risk monitoring of subrecipients

• Expedited collection of FFATA data elements

Thank You!Thank You!

Any

Questions?

Contacts• Sponsored Projects information: 4-

5599

• Sponsored Projects Directory:http://www.ospa.umn.edu/

directory.html