A subaward is a portion of an award that is distributed by the recipient of the original award (pass-through entity or prime) to a third party (subrecipient or subawardee) to conduct project work in compliance with the project’s terms and conditions. This is required when a grant or contract to one institution is in support of a sponsored project in which programmatic activity is carried out through a collaborative arrangement between or among the grantee institution and one or more other institutions or organizations which are separate legal entities, administratively independent of the grantee. The involvement of the collaborating institution is that of actually performing a portion of the programmatic activity as opposed to simply providing a routine service to the grantee, such as equipment fabrication or repairs, data processing or providing routine analytical testing services. Additional guidance on the determination of the appropriate contract mechanism can be found HERE.
Projects that involve subcontracts have special requirements both at the proposal stage and at the award stage and during the active life of the subaward.
Required Materials for a Proposal That Includes a Subaward
For each subrecipient included in a proposal, Penn must have a proposal from the subrecipient which has been through an institutional review process and authorized by the appropriate person at the recipient institution. This proposal must include the following documents:
- a statement of work
- a corresponding budget and budget justification
- a signed statement from the subrecipient that the submission has been authorized by the subrecipeint’s institutional official
- and, if required by the sponsor, the recipient institution(s) may need to provide certifications and representations, other support documentation, biosketches, etc.
Penn’s budget should include the total cost of each subaward, including the recipient institution's Employee Benefits (EB) costs and Facilities & Administration (F&A) costs, as a line item in the direct cost section of the budget proposal. It is the responsibility of the Penn PI to review the subrecipient's budget to ensure that it reasonably reflects an amount that is appropriate for the proposed scope of work.
Initiating a Subaward
In order to initiate a subaward, the principal investigator and business administrator must submit a request via the Research Inventory System. Effective August 14th, 2013 RIS should be used to request new subaward agreements and any subsequent request. A paper Subaward Request Form should be completed for any agreements that were initiated on paper.
See Instructions Here for paper request.
See User Guide for RIS initiated request.
What is Subrecipient Monitoring?
It is the responsibility of the Prime awardee to ensure that funding passed through to a subrecipient is used for program related purposes and that the subrecipient can properly manage the funds.
Financial Policies 2131 and 2135 (http://www.finance.upenn.edu/vpfinance/fpm/) establish the responsibility of ORS for monitoring of subrecipients receiving federal funds. Additional monitoring is required to be performed by the Principal Investigator and Business Administrator.
ORS is responsible for:
- Checking if subrecipient is subject to A-133
- If yes, obtaining most recent report
- If no, requesting audited financial statement and certifications
- Reviewing A-133 reports with significant findings and all non-A-133 financial documentation
- Documenting receipt of audit and financial documents
- Checking for debarment/suspension
- Preparing and assembling subcontract package
- Sending subcontract to subrecipient
- Notifying Business Administrator when subaward is fully executed.
The PI is responsible for:
- Reviewing scope of work from subawardee
- Certifying that budget is appropriate for scope of work
- Approving invoices certifying that the work was completed satisfactorily
- Determining additional funding based on progress
- Requesting reports as needed
The Business Administrator is responsible for:
- Collecting institutional approvals from subawardee
- Sending Subaward request Form to ORS
- Documenting PI approvals of invoices prior to authorizing payment
- Reviewing invoices prior to requesting additional funds
- Collecting institutional approvals from subawardee including a signed statement of intent
Additional information can be found at: http://www.upenn.edu/researchservices/Presentations/Submonitoring/Submonitor.pdf