Subcontracts - Office of Research

Research Administration Training Series
Subawards and Subcontracting
March 24, 2011
presented by Brian Prindle
Division of Sponsored Research
Research Administration Training Series
Goals of Session
 Division of Sponsored Research
• Subrecipient vs Vendor Determination
• Overview of the Pre Award Subaward Process
• Frequently Asked Questions
 Contracts and Grants Accounting
• Post Award Subaward Process
• Invoicing
• Payment
Research Administration Training Series
Subrecipient or Vendor; Why is this Important?
1. Impacts;
Documentation needed at the time of a grant
How you build your grant budget and apply
Who you will work with at the time of award. DSR or
What type of award is issued to the Subrecipient or
Research Administration Training Series
Characteristics of a Subrecipient?
1. Subrecipient assists in the work being conducted by the
University of Florida under the prime award.
2. Subrecipient maintains prime responsibility for their own
programmatic decisions.
3. Subrecipient is part of the team.
Research Administration Training Series
Characteristics of a Vendor
1. Vendors provide the goods and services to many
different buyers.
2. Vendors operates in a competitive environment.
3. Vendors are typically are for-profits. But not always.
Research Administration Training
Still confused?
Federal Circular OMB-A133
Use discretion and good
judgment when making a
Subrecipient Award Mechanism
For a Subrecipient work with DSR and we use:
Subcontracts and Subawards
DSR has Templates for both
DSR completes with help from PI and PI staff.
Authorized Officials for both Parties sign. For UF that is DSR.
Terms and conditions of the prime agreement do flow down to the
Vendor Award Mechanism
For Vendors you work with Purchasing and we use:
Contract for Services, Purchase Orders
Coordinate with Purchasing
You may need to go out for Bid
Sole Source Justification
DSR can grant an exemption to the UF purchasing rules
due to an emergency timing issue.
Research Administration Training
Let’s Play?
Subrecipient or Vendor
What is it?
Subrecipient or Vendor?
• University of Georgia Principal Investigator will be responsible
for supervising a Post Doc and other personnel connected with
the NIH funded project in the Atlanta area.
UG staff will assist the UF research team with enrolling subjects
into the NIH funded study from the Atlanta area.
UG PI will participate with the UF’s PI in the preparation of
progress reports and manuscripts resulting from this study. UG
PI will devote 25% effort to this project each year.
What is it?
Subrecipient or Vendor?
• Scholastic Inc. will assist in the development of book
collections for each book fair to be conducted at 17
elementary schools.
• The book collections will include appropriate titles for the
cultural groups represented in the particular schools where
the book fairs are held.
• Scholastic will send a representative to each of the
participating schools to complete the ordering and fulfillment
What is it?
Subrecipient or Vendor?
The Investigator will be responsible for video taping mice to collect
data in order to analyze taste reactivity. Monthly reports will be
provided to UF.
Investigator will play an integral role in the design and interpretation
of the experiments and contribute to the preparation of manuscripts
for publishing.
Research Administration Training
Subcontracting Frequently
Asked Questions
What is needed at the time of Proposal?
A subrecipient’s proposal should include the following:
1) Endorsement from the Subrecipient’s Authorized Official.
2) A clear Description of Work to be performed by the Subrecipient.
3) A corresponding Budget and Budget Justification.
Subrecipients May Need to Provide Additional
Information, such as:
 Biographical Sketches of Key Personnel
 Current and Pending Support of Key Personnel
 Representations and Certifications
 Detailed Budget Information
 Negotiated Facilities and Administrative Rate Agreement
 Financial Conflict of Interest Disclosure Forms
 Sole Source Justification
The UF Principal Investigator, if required by the
sponsoring agency, may need to provide a source
selection justification.
 Unusual Circumstances
Its not always straight forward. In those cases
unusual circumstances contact DSR’s Proposal
Processing Office in advance and we can talk it
Where do I budget for the Subrecipient Costs?
When preparing the overall project budget, include
the total costs of each subrecipient, which includes the
subrecipient’s fringe benefits and indirect costs, as one
line item in the UF direct cost budget.
When using the federal modified total direct (MTDC)
base, F & A is calculated on the first $25,000 of each new
subcontract, only.
When using a total direct cost (TDC) base, F & A is
calculated on ALL Subrecipient $.
Example (MTDC Base)
UF Salaries
$ 200,000
$ 25,000
$ 10,000
Subrecipient (USF)
Total Direct:
$ 390,000
(MTDC Base = 390,000 – 125,000)
$ 265,000
Indirect 46.5% MTDC
$ 123,225
$ 513,225
* exclusions: $125,000 USF subaward
Example (TDC Base)
UF Salaries
$ 200,000
$ 25,000
$ 10,000
Subcontract (USF)
Total Direct:
$ 390,000
(TDC Base $390,000)
Indirect 25% TDC
$ 97,500
$ 487,500
Proposal Has been Funded
Award is accepted and the Notice of Award (eNOA) is issued
DSR or OER Research Administrators (RA) will begin
subaward process
RA will pull from the UF proposal the subrecipient’s
“scope of work” and “budget”
RA will contact the PI or Department’s Grant Specialist to
confirm the details
Draft the subaward document – using templates.
Request C&G Accounting to encumber subaward funding
Subaward draft is sent to PI or Department Grant Specialist
for review, comments, and approval
Final subaward is sent to the subrecipient institution’s
Sponsored Programs Office for acceptance
Upon return of signed subcontract, DSR fully executes
Fully executed agreement is distributed to C & G Accounting, to the PI,
and to the Department Administrator
Subcontract is Fully Executed
Now What?
Responsibilities of PI:
1. Stay in touch with subcontractor’s PI.
2. Receive & review technical report/deliverables from
Subcontractor. Especially Finals
3. Coordinate with C&G Accounting the review and approval for
payment of Subrecipient’s invoices.
4. Review any requested changes in the budget, scope, project
dates, and forward to DSR or OER for processing.
CAS Regulations, Do they apply to a
(Cost Accounting Standards)
YES, if federal funds are the source.
CAS is found in OMB Circular A-21, which is part of Flow
through T & C’s.
Subcontractor is responsible for compliance with CAS
Can a Subcontractor
Carryover Unexpended Funds?
YES, if the UF award allows automatic carryover and
our PI agrees to flow this term down.
At the direction of our PI, a specific clause can be
added that subcontractor may NOT carryover of
unexpended balances, without UF prior approval.
Can a Subcontractor Grant itself a “No-Cost”
 NO - the subcontractor may not grant itself a no-cost
 If subcontractor requires an extension
PI must give DSR approval to extend the end date of subcontract
Subcontract date may not go beyond the UF end date.
UF Award may need to be extended.
Can a Subcontractor Grant
itself Preaward Costs?
• Yes, if the federal prime award allows pre award and
the terms of the subcontract do not remove the ability.
How do IRB & IACUC Rules
Apply to Subcontractor’s?
 Subcontractors are responsible for compliance with IRB &
IACUC regulations
 Subcontractors upon request, will need to provide proof of
IRB or IACUC approval at their institution before we will
release subcontract funds.
Can a Subcontractor Rebudget Funds
without UF Prior Approval?
 Depends
• FDP or Standard Research Terms - yes
• Expanded Authority- yes
• Fixed Price Subcontracts- yes
 Follow the rules of the prime award
 DSR can add special terms to not allow some costs without UF
prior approval.
For example: Purchase of Equipment where Equipment was not
budgeted for.
What Happens when the Subcontractor is Not
 PI works with Subcontractor
- informally
- formally
 Work with DSR
- resolutions
- terminations
 Terminations
- for Breach of Contract
- for convenience
 What if the Subcontractor's PI leaves and we would
like to have a new subcontract issued to the PI’s
new institution?
• Terminate early
• Final Report and Invoice
• Get Sponsor Approval if Necessary
 We did not include a subcontract in the original
proposal but would like to issue a subcontract.
What do we do?
• Contact DSR with questions. Most likely, UF’s sponsor will
need to approve, but not always.
• Will need a authorized subcontract proposal.
• Ship it off to the agency for approval or approve in house.
What are some Key Elements of UF Subcontract?
• Subcontract number
• Payment Terms
• CFDA number
• Reporting Requirements
• Prime Award Number
• Audit requirements
• Type: Cost or Fixed
• Allowable Costs
• Project Directors
• Compliance Certifications
• Period of Performance
• Termination
• Statement of Work
• Modifications/Amendments
• Funding Amount $$$
• Signatures of officials
Subawards and Subcontracting
That’s it for PreAward
The University of Florida
Contracts and Grants Accounting Services
Subawards &
March 24, 2011
Subaward Contact Info – 123 Grinter
Deb Strickland
[email protected]
Ed Parker
[email protected]
Peg Canaday - Main
[email protected]
Jerome Able – IFAS & EIES
[email protected]
Subaward Overview
1. For C&[email protected] and C&[email protected]: Awards
Administration in the Division of Sponsored Research
(DSR) prepares the subaward agreement and sends a
request to encumber the funds to C&G Accounting
2. For C&[email protected], the Office of Engineering
Research (OER) performs this function. From this
point on, C&G Accounting handles all the subaward
3. Note: For this presentation, only DSR will be used in
the steps that follow.
4. A purchase requisition is then prepared to encumber
the funds in PeopleSoft.
Subaward Overview
5. Purchasing generates the actual Purchase Order.
Unlike most PO’s, a copy is not sent to the
subrecipient/vendor. The subaward agreement itself
is their authorization to invoice UF.
6. The subaward is entered into the Subaward
Management Database – a Microsoft Access
7. Upon execution of the subaward agreement DSR
sends a copy of the document to the UF Principal
Investigator and CGA. Invoices cannot be paid until a
subaward has been fully executed. (There is an
example on the next slide.)
8. We are now ready for receipt of the first invoice.
Subaward Agreement
Subaward Database History
• The University of Florida has developed an
Access database that simplifies the monitoring
of subawards. It is capable of importing files
from PeopleSoft and the Federal Audit
Clearinghouse (FAC) website. This facilitates
keeping it’s data current.
• A Special “Thank you” to:
Nick Dunham
Director of Information Services
UF Office of Research
The Subaward Database
• Why do we need the database?
• The database has a separate record for each
subaward. Its contents are displayed using the
Subaward Detail window, which has three
functional tabs:
– Prime Award Info Tab
– Subrecipient Info Tab
– Transactions Tab
Examples of all three are next.
Prime Award Info
Subrecipient Info
Click Here
for details
Transaction Detail
Subaward Database Documents
• Each subaward has a unique number. C&[email protected]
and C&[email protected] use the format “UFXXXXX”.
C&[email protected] subawards use “UF-EIES”.
• The database self-generates the following:
– Subaward Summary Report
– Payment Certification Letters
• “Regular”
• “Final”
• Examples of both are shown next.
Payment Certification - Regular
Payment Certification - Messages
Please pay attention to
anything written in the
text box shown below.
Payment Certification - Messages
Please pay attention to
anything written in the
text box shown below.
Payment Certification – PI input
Complete this section if the
PI Approves the invoice
Complete this section if the PI Declines payment
Payment Certification - Final
Is this REALLY the “Final” ?
If not, “X” out the word “Final” before
sending the certification to C&G
Subaward Reports buttons
Subaward Summary Report
Payment Process for Invoices
• CGA reviews invoices received from the
subrecipient for appropriateness of charges,
dates of service, etc. If applicable, A-133
Federal Audit Compliance must be determined
before the first invoice is paid.
• The invoice is entered into the database. The
Subaward Payment Certification and related
documents are generated.
• The Payment Certification, invoice, and
Subaward Summary Report are emailed to the
department for PI’s signature/approval.
Payment Process for Invoices
• The PI indicates approval/denial on the Payment
Certification letter. A justification, signature, and
date are required. The letter is the only
document we need to have returned. Please do
so within 3 business days…. or you’ll get a visit
from THIS guy!
Reasons for Delayed Payment
• The Certification letter is missing any of the 3
requirements just listed on the previous slide – or
has not been returned at all.
• The subrecipient is not A-133 compliant according
to the Federal Audit Clearinghouse, and has not
returned the A-133 Compliance letter we send to
• Budget problems with the related PeopleSoft
project, and/or the subaward itself.
The invoice is now ready to be paid.
• A voucher is created by C&G and the
original invoice, payment certification, and
bar code are faxed to Disbursement
Services for audit, payment approval and
archival imaging.
Subaward PeopleSoft Accounts
• Subaward expenses are charged to account 712100 (
first $25,000 if applicable ) and 712200.
Helpful Information
• Agencies to which UF makes payments and their A133 Audit Status are found at:
– If a non-Federal entity will be expending Federal awards,
they must be listed on this website before payments can
be made.
– A-133 requirements may not apply to the subrecipient, but
they still need to be on the website. I’ll go into more detail
as we review the next slide.
• Several forms related to subawards can be found on
DSR’s website at:
The OMB A-133 Subaward Website
Spent < 500,000
Foreign Entity
For Profit Company
Thank you for coming!
 Any
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