1307 Subrecipient Monitoring

Responsible Official: 
Executive Director, Office of Sponsored Projects
Responsible Office: 
Office of Sponsored Projects
Effective Date: 
December 1, 2006
Revision Date: 
April 20, 2017

IMPORTANT:  For federal awards/subawards issued to Yale with a start date prior to December 26, 2014, 2 CFR Parts 215 and 220 (OMB Circulars A-21 and A-10) apply.  For all new funds (new awards and new monies, such as continuation awards, supplements, etc.) received for existing awards with a start date on or after December 26, 2014, these new funds are subject to 2 CFR Part 200 (OMB Circular A-81, commonly referred to as Uniform Guidance but hereinafter referred to as “2 CFR Part 200”).

Due to the change in federal regulations the language in this Policy specific to the new regulations, 2 CFR Part 200, is highlighted in red font below

Policy Sections

Scope

This document applies to all subawards issued under sponsored awards issued to Yale University and regardless of the primary source of funding.  (See Procedure 1307 PR.01 Monitoring Subrecipient Activity Associated with Sponsored Programs for additional information.)

This policy does not apply to professional services and consultant agreements (see Policy 3210 Professional Services and Consulting Agreement) nor does it apply to the procurement of goods or services from vendors.

Policy Statement

A Yale University relationship with a subrecipient is documented in a formal agreement that is negotiated on behalf of Yale University by the Office of Sponsored Projects (OSP) and an authorized representative of the subrecipient organization.

Further, it is Yale’s responsibility to monitor the programmatic and financial activities of its subrecipients

in order to ensure:

  • The proper stewardship of sponsor funds;
  • Performance goals (scope of work, specific aims, and/or deliverables) are achieved/received; and
  • Compliance with the terms and conditions of the subrecipient agreement.

Note: If a Yale Principal Investigator has a significant financial interest in the subrecipient entity, it shall be disclosed to Yale’s Conflict of Interest Office and, when appropriate, managed by the Provost’s Committee on Conflict of Interest.

Reason for the Policy

To inform the community of its obligation regarding the proper monitoring and stewardship of sponsored funds when those funds are used to issue a subaward to a subrecipient.  As a condition of an award made to Yale, the University is obligated to comply with applicable federal, state, and local regulations.  When the University assigns responsibility to a subrecipient for conducting a substantive portion of the work under a Yale award, the University remains responsible to the sponsor for the management of funds and meeting performance goals.  Thus, the monitoring of technical and financial activities associated with a subrecipient is an integral part of the University’s stewardship of sponsor funds.

Definitions

Subaward (also referred to as a subgrant or subcontract) is an award of financial support from a prime awardee (e.g., Yale) to a qualified organization for the performance of a substantive portion of the programmatic effort under the prime award.  The term also includes awards made by a subrecipient to a lower tier subrecipient.  It does not include procurement of goods and services purchased under an award, as the providers of these goods and services have no programmatic responsibility.

A-81 Section 200.92:  Subaward means an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a Federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a federal program. A subaward may be provided through any form of legal agreement, including an agreement that the pass-through entity considers a contract.

Subrecipient is the legal entity (also referred to as a subawardee or subcontractor) to which a subaward is issued and is accountable to Yale for the use of the funds to conduct a portion of Yale’s programmatic effort under a sponsored project.  Typical subrecipients of Yale include institutions of higher education, for-profit corporations, not for profit entities, and foreign or international organizations.

A-81 Section 200.93: Subrecipient means a non-Federal entity that receives a subaward from a pass-through entity to carry out part of a Federal program; but does not include an individual that is a beneficiary of such program. A subrecipient may also be a recipient of other Federal awards directly from a Federal awarding agency.

Subrecipient Monitoring includes those activities undertaken by Yale to review and monitor the subrecipient’s completion of the scope of work as well as its financial stewardship of the funds the subrecipient received under the subaward. This activity is intended to mitigate any financial and programmatic risk.

Policy Sections

1307.1 Pre-Qualification of Subrecipients

The University assesses the subrecipient’s financial status and internal controls by evaluating the responses to the Subrecipient Information and Compliance (SIC) form and Subrecipient Questionnaire. (SQ).  Based on this evaluation, Yale determines the appropriate monitoring strategy which is reflected in the terms and conditions of the subrecipient agreement.  The strategy is consistent with the level of risk determined by the University (see Procedure 1307 PR.01).

1307.2 Subawards Under a Federal Prime Award:  Required Data Elements

For subawards issued under a federally funded prime award, Yale must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the data elements indicated below, as required by 2 CFR Part 200.331 (OMB Circular A-81). If at the time of issuing the subaward, any of the data elements are not available, Yale must provide the best information available to describe the Federal award and subaward.  If any of the data elements change subsequent issuing the subaward, the changes must be included in a subaward modification.  The required data elements for all subawards under a federal prime award include:

  • Subrecipient names (must match registered name in DUNS)
  • Subrecipient’s DUNS number
  • Federal Award Identification Number (FAIN)
  • Federal Award Date
  • Subaward Period of Performance Start and End Date
  • Amount of Federal Funds obligated by this action
  • Total Amount of Federal Funds obligated to the subrecipient
  • Total Amount of the federal award
  • Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA)
  • Name of Federal award agency, pass-through entity, and contact information for awarding official
  • CFDA number and name
  • Identification of whether the award is R&D
  • Indirect cost rate for the Federal award [including 10% MTDC de minimus rate for subrecipients without a federally negotiated rate (8% MTDC, less equipment for foreign entities under a NIH prime award).]

 

1307.3 Subrecipient Monitoring

The University shall perform the following stewardship activities (refer to Procedure 1307 PR.01 for specific monitoring activities) with regard to its sponsored awards subrecipients:

  1. The Provost’s committee on Conflict of Interest  will identify and recommend the means to eliminate or manage any conflict of interest arising from a proposed subaward by the University to an entity in which the University or a Yale faculty member has a financial interest or fiduciary relationship.
  2. Advise subrecipients of requirements (including but not limited to financial and non-financial reporting) imposed on them by federal laws, regulations, flow-down provisions of the prime agreement, and any supplemental requirements imposed by the University as a result of a risk assessment.
  3. Monitor the costs and activities of the subrecipient as appropriate, confirm that funding provided to the subrecipient is used for purposes authorized by the executed agreement, and that the performance goals (scope of work or specific aims) are achieved.
  4. Upon receipt of an unfavorable audit report from a subrecipient, the University will confirm that the subrecipient has taken appropriate and timely corrective action.  If a material weakness or other reportable condition exists, develop a monitoring plan appropriate for the circumstances.
  5. Consider whether subrecipient audits necessitate adjustment of the University’s financial records and/or subaward.
  6. Require each subrecipient to permit Yale’s sponsor and/or the University and its auditors/representatives to have access to the subrecipient’s pertinent records and financial statements, as necessary.  Where it is not possible to obtain this access, alternate solutions may be considered but generally would require the approval of the prime sponsor.
  7. Confirm by checking the Federal Audit Clearinghouse or the FDP on line Entity Profile that subrecipients expending $500,000 (for fiscal years ending prior to  December 26, 2014)/ $750,000 (applicable for fiscal years ending after December 26, 2014) or more in federal awards during the subrecipient’s fiscal year are compliant with OMB Circular A-133 audit requirements or 2 CFR 200 Subpart F - Audit Requirements.  Identify any material weaknesses or reportable conditions that result from a single audit.

Roles and Responsibilities

Office of Sponsored Projects

  • Verifies subrecipient has submitted a SIC Form or Letter of Intent as applicable, proposal, and supporting documentation prior to Yale’s proposal submission to the sponsor.
  • Reviews any additional information required at JIT or before issuing the subaward.
  • Performs a subrecipient risk assessment for first-time subrecipients or for a subrecipient that has not received a subaward within the last completed fiscal year. 
  • Reviews financial risks to determine whether to do business with a subrecipient.
  • Determines special terms and conditions in the subaward based on risk.
  • Negotiates and executes subawards between the University and subrecipient organizations.
  • Educates PIs and DBOs on subrecipient processes.
  • Monitors and provides guidance regarding the interpretation of applicable regulations and subaward terms and conditions.
  • Maintains the subrecipient/subaward file, checks compliance approvals/completion and assigns new subaward numbers.
  • Sets up subaward data in SMS and notifies DBO if a new vendor set-up is needed.
  • Scans subaward documentation into IRES’ PT module and notifies OGM Set-up Unit to complete SMS set-up.
  • Develops a risk mitigation strategy as necessary based on the results received from the risk analysis including the Subrecipient Questionnaire.
  • Completes the subaward set-up in SMS and distributes information to DBO.
  • Reviews the subrecipient A-133, or A-81 audit reports as applicable or Federal Clearinghouse submission to verify completion of an annual audit and to assess the audit findings, if any.
  • For entities not subject to A-133 or A-81, OSP may request audited financial statements and/or the completion of a financial control questionnaire from the subrecipient.  OSP will assist in the resolution of any financial questions related to invoices; including the disallowance of questionable costs which cannot be adequately justified or substantiated by the subrecipient.
  • Sends the subaward agreement to the PI and DBO for review and comment.  Instructs the DBO to relay any comment/concerns of the DBO and/or PI to OSP prior to issuance to subrecipient.
  • Uploads into the PT record any comments/concerns the DBO sends to OSP regarding the subaward agreement.
  • Maintains SMS report distribution list for monthly SMS reports to DBO.
  • Receives subaward closeout information from the DBO and deobligates commitments from the SMS.
  • Monitors and provides guidance in interpreting applicable regulations and subrecipient award terms and conditions.
  • Determines the monitoring activities that will be undertaken annually to ensure subrecipients’ compliance with the terms and conditions of the subaward.
  • Conducts periodic reviews of subrecipient compliance.

Yale Shared Services

  • Receives subaward invoices and distributes copies electronically to DBO.
  • Processes and pays invoices signed by the DBO and PI. 

Principal Investigator

  • Identifies a qualified entity to carry out part of a federal program.
  • Ensures the subrecipient submits Yale’s SIC Form or Letter of Intent as applicable, proposal, and supporting documentation to OSP prior to Yale’s proposal submission, updates at JIT, or in advance of issuing a subaward and meeting non-NIH sponsor requirements.
  • Receives subaward agreement from OSP for review and comment.  Informs the DBO of any comments/concerns to relay to OSP prior to issuance to subrecipient.
  • Monitors the technical progress of a subrecipient’s performance as defined in the SOW of the subaward.
  • Reviews and approves subrecipient invoices, verifying that claims are consistent with technical/progress reports and received deliverables.
  • Collaborates with OSP to resolve issues with subrecipient invoices.
  • Determines the frequency and scope of DBO monitoring procedures.
  • Notifies OSP immediately if there is a performance problem with a subrecipient or the need to add/reduce funding, extend the performance period or terminate the subaward.
  • Obtains and retains all required deliverables including but not limited to final technical and interim progress reports, patent/invention documentation, and equipment reports in accordance with sponsor and University policy.

DBO

  • In conjunction with PI, ensures the subrecipient submits Yale’s SIC Form or LOI as appropriate, proposal, and supporting documentation to OSP prior to proposal submission. 
  • Assists PI with the receipt of updated documents, or additional information needed at JIT or information needed in order for the subaward to be issued.
  • Reviews SMS set-up report and notifies ogmsetup@yale.edu for any corrections (e.g., PTAO, burden limit)
  • Receives subaward from OSP for review and comment. DBO relays any comments/concerns of the DBO and/or PI to OSP prior to issuance to subrecipient.
  • Ensures subrecipient invoices contain all the minimum required information in order to process payment.
  • Reviews subrecipient invoices for cost allowability and ensures compliance with federal regulations and subaward terms and conditions.
  • Supports the PI in his/her efforts to ensure that payments to subrecipients are appropriate given the status of technical efforts and progress versus funds expended.
  • Reviews and signs subrecipient invoices for adherence to budget and/or terms and conditions of the subaward.
  • Ensures that all invoices have been approved by the PI.
  • Submits invoices for payment in a timely manner and retains copies for department records. (Payment for subrecipients under a federal prime award must be within 30 days of receipt of the invoice.)
  • Assists PI in obtaining and retaining all required deliverables including but not limited to final technical and interim progress reports, patent/invention documentation, and equipment reports in accordance with sponsor and University Policy.
  • On behalf of the PI, submits carryover requests to OSP as necessary.
  • Completes subrecipient reconciliation form as part of close-out process.

Accounts Payable

  • Sets up and establishes subrecipients in the A/P tables.
  • Enters invoice information into the accounts payable system where the invoice information will be matched and verified against the subaward invoice validation routine.
  • Assigns all invoices that do not pass the subaward invoice validation routine to the AP work list for DBO and/or OSP review.
  • Issues payment for invoices once all validations pass and approvals obtained.

University Research Compliance Officer

  • Advises OSP regarding subrecipient risk assessments and supporting risk-mitigation strategies, as appropriate.

Vendor Compliance Unit

Creates the vendor and vendor profile in Oracle for payment and ensures the integrity of the Oracle vendor database.