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Sub Award Management

Difference between a Sub recipient and a Vendor, per Office of Management and Budget Circular A-133

A Sub recipient:

  • Has a responsibility to carry out a portion of the grant program as defined in the Subcontract,
  • Has its performance measured against the grant program objectives,
  • Has responsibility for programmatic decision making,
  • Has responsibility for adherence to applicable federal program compliance requirements.

A Vendor:

  • Provides goods and services within normal business operations,
  • Provides similar goods and services to many different purchasers,
  • Operates in a competitive environment,
  • Provides goods and services that are ancillary to the operation of the grant or contract,
  • Is not subject to compliance requirements of a federal grant or contract.

Vendor purchases are not to be charged to Subcontractor or federal Pass-through object codes.

Sub-recipient Monitoring

1.1 Purpose

The Sub recipient monitoring policy provides guidance to Principal Investigators and administrative personnel in monitoring federal flow-through funds in accordance with the OMB Circular A-133.

The A-133 requires review of all pending and executed Subcontracts with particular attention paid to scope of work statements (SOW), billing instructions, contact information, and amendment and modification sections. Monitoring Subcontracts entails:

  • Applying Risk Assessment to Subcontracts (pre and post award),
  • Maintaining a tracking system for all Subcontracts (post award),
  • Monitoring invoices received from the collaborator (post award),
  • Obtaining and reviewing audit reports from collaborator (post award),
  • Performing random expenditure audits. (Desk review/On-site audits at the post award stage),
  • Assisting with closeout of Subcontracts (post award).

NOTE: The Sub recipient Monitor will ensure that all Pass-through entity responsibilities are adhered to in accordance with the A-133 circular as described in the publication procedures for handling Subcontracts.

These responsibilities can be reviewed here.

1.2 Terminology
Financial Assistance:
Provides support or stimulation to accomplish a public purpose (can be issued as a grant or cooperative agreement)
Purchase of goods and services to accomplish a government purpose; service can include research (issued as a contract)
Generic term for agreements issued under a contract or grant
Sub award or Sub agreement:
A Subcontract for programmatic Effort, under a grant
Vendor Agreement:
A Subcontract for commercial goods and services, under a grant or contract
Sub recipient:
The entity that receives a Sub award
Recipient or Pass-through entity:
The entity that receives federal funds and issues a Sub award
Flow-through funds:
Monies that are passed from the primary Recipient to a secondary entity or Sub recipient
Random sample:
Can be defined as one in which every component has an equal probability of being selected from the larger population of all components.
1.3 Policy

All federal Recipients are required to maintain and monitor each Sub award or Sub recipient supported by funds the institute receives from the federal government. All Subcontract documents shall describe applicable laws and regulations required to be followed by the Sub recipients. All Subcontracts expending federal funds of $500,000 or more in grant dollars must perform a fiscal year audit and should be monitored routinely by the primary institute in accordance with the A-133 circular.

The Prime Institute must ensure compliance with federal laws, regulations, contract and grant agreement provisions and that performance goals are achieved by the Sub recipients. The Sub recipient monitor processes include:

  • Maintaining a tracking system for reporting findings and responses,
  • Reviewing the evaluation of Sub recipients A-133 audit report,
  • Evaluating suggested corrective actions for audit deficiencies,
  • Reviewing and monitoring the Sub recipient budgets,
  • Contacting the Sub recipient addressing any inquiries concerning the federal program (Protocol information, Institutional tax status, Negotiated F&A rates, Current Fringe rates, etc.),
  • Performing site visit to observe operations and review financial records as necessary,
  • Initiating performance reports when required,
  • Providing technical assistance to Sub recipients when needed.

Non A-133 Institutions will receive a Risk Assessment and ranking which will determine the frequency of monitoring.

1.4 Office of Post Award Management Role

The Office of Post Award Management will process for approval to the PI invoices received and monitor budget compliance.

All Subcontracts will require the following certification language on Sub recipient invoices. Absence of this certification will result in non-payment of Subcontractor invoices.

"I certify that the expenses represented by this invoice have been incurred in support of the work covered in this contract, and are in accordance with the provisions of this contract and all applicable federal and state laws and regulations."

(Subcontractor Signature)

Please see the Department of Finance Website for additional information.