Don’t Let Subawards Sink You! Judy Krzyzek & Karen Sachi

1. Don’t Let Subawards Sink You! Judy Krzyzek & Karen Sachi Office of Sponsored Projects Administration

2. 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

3. 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

4. PI Evaluates Potential Subrecipients How is the subrecipient selected? • Past performance • Technical/financial resources • Proposed scope of work • Reasonableness of proposed costs

5. 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

6. 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

7. 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) Information needed from Departments to Issue a Subaward

8. 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: DUNS# Program Source DUNS # of Parent Title EntityName Transaction Type Funding Agency NAIC or CFDA# PrimaryPerformanceLocation Location of Entity Award $

9. 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

10. 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)

11. 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: PI/Dept

12. 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 Monitoring Responsibilities: SPA

13. 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) Modifications and Terminations

14. 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

15. 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)

16. 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

17. Thank You!

18. Any Questions?

19. Contacts • Sponsored Projects information: 4-5599 • Sponsored Projects Directory: http://www.ospa.umn.edu/directory.html