Pre-Award Activities: Getting the Subcontract in Place
If a grant awarded to a department has a subcontract, the Office of Sponsored Projects (OSP) will contact the subcontractor when the award arrives. However, it is the department’s responsibility to follow up with OSP to ensure that the subcontract is being initiated in a timely manner. Contact with OSP should be by email, saying something such as the following:
We’ve been awarded an NIH grant having a sub-contract with ______________ for the period _______________ to _________________. Please initiate the sub-contract.
Another departmental responsibility is to only do business with “eligible” subrecipient agencies. Eligible agencies include:
- Agencies that are willing and able to comply with the requirements of the award.
- Agencies that have accounting systems that are adequate to administer the award.
- Agencies and collaborators that have not been suspended or debarred from receiving federal funding.
Departments also assist OSP in identifying “higher risk” subrecipient agencies or contracts that will need an increased level of monitoring activities, including:
- Programs/projects with complex compliance requirements.
- Programs/projects for which a large percentage of the primary award or large dollar amount of the primary award will be subcontracted out.
- Agencies that fall under different audit guidelines than the OMB A-133, especially foreign agencies that do not fall under any OMB standards.
- Agencies with past performance problems as evidenced by historical data from the University, including late submission of billings; late submission of services, scientific reports, etc.; billing for disallowed costs; repeatedly revising billings; or evidence of failure to comply with their own internal policies (such as time limits on cost transfers).
It is also important that the departments work closely with OSP to ensure that the subcontract includes language that provides a framework for compliance. This is done by:
- Making sure that the budget from the subrecipient is adequate to complete the work and contains only allowable costs.
- Making sure that the scope of work from the sub-recipient includes measurable outcomes.
OSP will sends the subcontract to the collaborator for their signature. Once the subcontract is completed and executed, OSP images the subcontract, sends a copy to the PAF Team, and sends a copy to the department for their files.
The PAF Team sets up the Recapitulation Sheet to record subcontract invoices and payments.
Post-Award Activities: Subrecipient Monitoring
The PAF Team receives invoices for the subcontract and does the following:
- Verifies that a sub-contract is in place.
- Verifies that the billing period is within the subcontract period.
- Verifies that the billed IDC rate is correct, per the subcontract.
- Verifies that sufficient funds are available to pay the invoice.
- Verifies the certification language.
After completing the review and verification, the PAF Team sends the invoice to the department for their review and certification for payment.
The department reviews the invoice to ensure all expenditures are appropriate. The PI must agree with the expenditures on the invoice, and should monitor the following:
- The billing/invoice amount accurately represent the amount of scientific data or progress by the sub-recipient.
- There is sufficient supporting documentation to determine if the expenses on the invoice are allowable expenses.
- Whether the subrecipient is spending money too quickly, indicating that the funding may run out before the work is complete.?
- Whether the sub-recipient is having trouble getting started on the project.
After completing the review and following up and resolving any concerns, the PI should approve the invoice for payment. The departmental staff will enter a Non-PO voucher in the PeopleSoft FMS system so that a check can be mailed to the subcontractor. The department sends the completed Non-PO voucher with its supporting documentation to the Disbursements Team, who will forward it to PAF for review.
The PAF Team logs the voucher on the Recap sheet, reviews it, and sends it back to Disbursements for final processing.
Disbursements then cuts a check and sends it to the subcontractor.
Below is a flowchart that details the process: