1307 PR.01 Monitoring Subrecipient Activity Associated with Sponsored Programs

Revision Date: 
April 20, 2017

Overview

Reason for the Procedure

        Procedure

A. Determine if the Proposed Activity is a Subrecipient or Vendor Relationship with Yale

B.  Proposal Preparation and Review

C.  Activites Conducted Prior to Issuing a Subaward

D.  Creating, Negotiating, Executing, and Setting-Up Subawards

E.  Processing Subrecipient Invoices

F.  Subrecipient Monitoring

G.  Closeout of Subrecipient Agreements

Related Information

Roles and Responsibilities

IMPORTANT:  For federal awards/subawards issued to Yale with a start date prior to December 26, 2014, 2 CFR Part 220 (OMB Circular A-21) and OMB Circular A-133 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 Procedure specific to the new regulation, 2 CFR Part 200, is highlighted in red font below.

Overview

This procedure outlines the process for the determination of risk and proper management of subrecipients under a prime award to Yale and supports Policy 1307: Subrecipient Monitoring.  All faculty and staff  involved in the conduct and/or oversight of sponsored research involving a subrecipient should follow the procedures outlined in this document.

Reason for the Procedure

Yale has the responsibility for ensuring that all research carried out by a subrecipient is conducted and administered in compliance with federal regulations as well as sponsor and Yale requirements.  This procedure defines general roles and responsibilities of the affected individuals and describes the activities that should be undertaken when proposing/issuing a subaward to a subrecipient and managing subrecipients. 

Procedure

A.Determine if the Proposed Activity is a Subrecipient or Vendor Relationship with Yale

The initial determination of whether or not a subrecipient or vendor relationship exists is a Principal Investigator (PI) and their department business offices/Faculty Research Management Services (FRMS) (hereinafter collectively referred to as “DBO”) responsibility.  This determination should be done early in the proposal planning stages so that the entity is correctly reflected and budgeted in the proposal.  The Office of Sponsored Projects (OSP) should be contacted if assistance is needed to determine whether a proposed entity is a vendor or a subrecipient.  It should be noted that vendors include but are not limited to consultants where a fee-for service or equivalent relationship exists.

In general, a subrecipient relationship with Yale will include the following characteristics:

  • The principal goal of engaging the entity is to carry out a public purpose authorized by Yale’s prime award
  • The performance of the entity is measured against the objectives of the prime award
  • The entity has programmatic decision-making responsibility
  • The entity receives prime award funds from Yale through a subaward to carry out its own program
  • The entity exercises considerable discretionary judgment
  • The entity may be required to provide matching funds or cost sharing dollars
  • The entity has its performance measured in relation to whether objectives of sponsored award were met
  • The entity is responsible for adherence to applicable federal program requirements specified in the federal award if under a federal prime award or the requirements of the non-federal sponsor, as appropriate

In general, a vendor relationship with Yale will include the following characteristics:

  • The principal purpose is to acquire goods or services for the direct benefit of an award
  • The entity provides the goods and services within normal business operations
  • The entity provides similar goods or services to many different purchasers
  • The entity normally operates in a competitive environment
  • The entity provides goods or services that are ancillary to the operation of the prime award program
  • The entity provides services of a repetitive nature or goods of a commonly available kind
  • The entity is generally not subject to compliance requirements of the federal program as a result of the agreement, though similar requirements may apply based on the scope of work (e.g., IRB approval, COI).

Not all of the above characteristics must be met when determining an appropriate vendor/subrecipient relationship but rather are good indicators of the type of relationship.  However, if the entity is identified by Yale’s PI as having a responsibility for the conduct, design, or reporting of the research, then the entity would most likely be considered a subrecipient.

Note:  Under 2 CFR 200, agencies can impose additional specific requirements to recategorize vendors as subrecipients, therefore it is important to review the sponsor’s criteria as well as the above.

B.  Proposal Preparation and Review

  1. Subaward Preparation

Yale PIs should alert their DBO as early as possible of their intent to include a subrecipient in a proposal in order to allow time for the collection of required information and certifications from the subrecipient.

Institutions Participating in the Federal Demonstration Partnership Pilot

Yale is a participant in the Federal Demonstration Partnership’s (FDP) Expanded Clearinghouse Pilot designed to determine the usefulness of an on-line standardized subrecipient data repository.

As a participant in the Pilot, Yale DBOs are responsible for collecting:

  • a completed/signed one page Letter of Intent from any proposed subrecipient that is also a FDP Pilot institution [link to Cohort 1 and Cohort 2]; and
  • a Scope of Work, Budget and Budget justification page from the subrecipient Pilot institution.

Note:  FDP Pilot subrecipients DO NOT need to complete a Subrecipient Information and Compliance (SIC) Form. 

Institutions NOT Participating in the Federal Demonstration Partnership Pilot

For all other institutions that are not in the FDP Pilot, the following process for collection of subrecipient documentation should be followed:

  • The PI, with the assistance of their DBO, is responsible for obtaining a completed SIC Form (Form 1304 FR.03A), signed by the subrecipient’s authorized representative along with supporting documentation, as applicable, prior to the submission of the proposal to OSP. The completed SIC Form must be sent to OSP with the proposal.

The SIC Form includes the following information/requirements:

  • Whether or not the proposed Statement of Work (SOW) includes human and/or animal research.

Note: IRB/IACUC approval is often indicated as pending at the time of proposal submission.  In such cases, a copy of the approval documents is required prior to award setup and issuance of the subaward [for NIH at Just in Time (JIT)].

  •  Conflict of Interest Certification.
    • Proposals may not be submitted to a PHS agency, a PHS-like sponsor, or the NSF without certification from the subrecipient that it has a compliant policy and has made all required disclosures.  For a list of PHS agencies and PHS-like sponsors visit:  http://your.yale.edu/research-support/conflict-interest/frequently-asked-questions-coi, scroll down to General FAQs and click on, “What are the PHS agencies and other sponsors that have adopted the PHS regulations”.
      • When the subrecipient does not have a compliant PHS policy, the DBO provides the subrecipient with the Yale model PHS compliant policy and model disclosure form for the subrecipient to adopt and complete.
      • Implementing a COI policy will take time and the subrecipient should be aware of the requirement well in advance of the proposal deadline.  The DBO should notify the OSP Proposal Reviewer immediately if the subrecipient indicates on the SIC Form that the subrecipient does not have a compliant policy. 
      • In those rare instances when a subrecipient does not have a PHS compliant policy and is unable to adopt the model policy at the time of proposal submission, Yale’s COI policy will apply to the subrecipient’s personnel identified as being “responsible” for the design, conduct or reporting of the research.  Yale must receive the disclosure before the proposal is submitted to OSP.  The subrecipient must however, certify that it will have a compliant policy by the time of award.

Note:  For additional information regarding COI requirements as they pertain to subrecipients, visit:  http://your.yale.edu/research-support/office-sponsored-projects/proposals/subawards

  • Institutional certification and commitment by the subrecipient’s Authorized Representative to participate in the project and abide by all of the associated terms and conditions of a potential award.
  • Statement of work (SOW)
  • Budget and budget justification pages
  • F&A rate agreement
  •  
  1. Proposal Budgets with Subrecipients

When preparing a proposal budget that includes a subrecipient(s):

  • Ensure that the subrecipient’s total direct and F&A costs are included as a direct cost in Yale’s budget on the Consortium/Subaward line. 
  • Ensure that subrecipients without a federally negotiated F&A rate include a de minimis rate of 10% of modified total direct costs (MTDC), unless otherwise prohibited or restricted by the prime sponsor. The NIH restricts the F&A rate to 8% MTDC, less equipment, for foreign subrecipient institutions.
  • Ensure Yale’s F&A rate is only applied to the first $25,000 of the subrecipient’s total budget if proposing to a federal sponsor.
    • Proposals to non-federal sponsors may have different F&A cost recovery requirements.  Therefore, the charging of Yale’s F&A rate to the entire subaward budget may be appropriate.
  • Consider and determine if a fixed amount subaward (up to $150,000 over the entire Federal project period) is appropriate. Standards used to make this determination include:
    • The project scope must be specific and adequate cost, historical or unit pricing data is available to establish a fixed amount.
    • The subrecipient will realize no increment above the fixed amount.
    • Prior approval from the federal sponsor is required for fixed amount subawards NOT included in the original proposal.
  1. Proposal Review
  • OSP reviews and verifies that the SIC Form and required certifications are complete prior to proposal submission.  OSP will contact the DBO to gather any missing information or certifications from the subrecipient.  Additional documentation requirements may include biosketches, current and pending or support pages, and consortia and/or proposal endorsement letter.
  • If the proposed subrecipient is a foreign entity, the proposal and subsequent subaward document may require review and approval by the Director of Export Controls (review Guidelines on Export Controls for additional information).  The PI and/or DBO should contact the Director of Export Controls for guidance in advance of submitting the proposal to OSP.   

C.  OSP Activities Conducted Prior to Issuing a Subaward

  1. Risk Assessment and Mitigation

OSP assesses the subrecipient’s financial status and internal controls prior to issuing a subaward.  Depending on the outcome of the assessment, additional terms and conditions may be included in the subaward to address and mitigate any identified risks. 

In order to assess a potential subrecipient’s level of risk, OSP may perform the following actions:

  • A subrecipient that has no previous relationship with Yale or has a previous relationship with Yale but does not have an annual audit will be contacted by OSP and asked to complete a Subrecipient Questionnaire (SQ) at NIH’s JIT or similar timeframe for other sponsors.
    • Foreign subrecipients will be asked for a copy of their most recent audit at year one and each continuation year of the subaward.
  • Assess the subrecipient’s SIC and SQ responses in order to identify potential internal control weaknesses, regulatory concerns, and financial status. The assessment actions include, but is not limited to:
    • A review of previous audit results including whether or not the subrecipient is subject to a Single Audit in accordance with OMB Circular A-81’s Subpart F-Audit Requirements.
    • A determination of adequate controls and systems in order to comply with federal requirements such as effort reporting systems, cash management controls, etc.
    • The subrecipient’s prior Yale experience with the same or similar subawards.
    • Evaluation of the subrecipient’s ability to comply with human and animal subjects and/or conflict of interest regulations.
    • The extent and results of federal awarding agency monitoring (e.g., if the subrecipient also receives federal awards directly from a federal awarding agency).
  • If the OSP assessment identifies areas of concern, OSP, in consultation with the PI and DBO and, the University Research Compliance Officer as appropriate, will determine an appropriate risk mitigation plan.  The mitigation strategy may include:
    • More frequent reporting;
    • Site visits;
    • Requiring supporting documentation with each invoice;
    • Providing Yale with copies of policies and procedures; and
    • Eliminating administrative flexibilities provided to Yale by its sponsor. For example, not flowing down to the subrecipient certain authorities such as rebudgeting capabilities.

Yale must notify the subrecipient as to:

  • The nature of the additional requirements;
  • The reason why the additional requirements are being imposed;
  • The nature of the action needed to remove the additional requirement, if applicable; and
  • The method for requesting reconsideration of the additional requirements imposed.

Any special conditions must be promptly removed once the conditions that prompted them have been corrected.

Risk mitigation and subrecipient monitoring strategies will be informed by the specific risks identified, type of subrecipient organization, and the nature of the scope of work to be completed by the subrecipient.

  1. Subrecipient Regulatory Compliance and Assurance Requirements
  • Prior to the submission of NIH JIT materials or similar process for other sponsors, or in advance of issuing a subaward to the subrecipient, OSP will review and confirm that all required subawardee documents and certifications have been received.  OSP will contact the DBO to secure any needed documents or information.
  • The Principal Investigator and their DBO are responsible for gathering from the subrecipient and submitting to OSP all remaining required information, documents and certifications which may include but are not limited to:
    • IRB/IACUC protocol approval information
    • Certification that the subrecipient adopted its own PHS FCOI Policy
    • F&A Rate Agreement, if changed
  • Subrecipients may be required to submit certifications and representations on an annual basis. Submission may be required more frequently if the subrecipient fails to meet a requirement of a federal award.
  1. Issuing a Subaward
  • Once OSP has received the NoA or a fully executed award and the award has been set-up in IRES’ PT module, the OSP Specialist requests a final subrecipient budget(s) from Yale’s PI and DBO. The DBO completes Form 1304 FR.03D (Scroll down to the forms section and open Form 1304 FR.03 B-E Transmittal Summary Form. Select tab at bottom of excel sheet titled “Sub Spreadsheet”) and sends it to the requesting OSP Specialist. 

Note:  OSP will not create nor will OSP issue a subaward if any of the required information, certifications, and/or documents are missing or if Yale has received a funding restriction from its sponsor that impacts the subrecipient.

  • The OSP Specialist will prepare the subaward and assign a unique Yale Subaward Number from the Subaward Management System (SMS).  The subaward is then sent to the DBO and PI for review/comment before the subaward is sent to the subrecipient.

D.  Creating, Negotiating, Executing, and Setting-Up Subawards

  1. Determining Subaward Terms and Conditions
  • Subaward terms and conditions are based on the prime award to Yale and any other requirements to assist Yale in its responsibility of proper stewardship of the prime award and monitoring the subrecipient.  The DBO and PI should review the subaward document paying particular attention to the following terms and conditions:
  • Technical/ program reporting requirements
  • Period of performance and termination
  • Financial terms and conditions including but not limited to billing requirements and payment terms
  • Ownership of intellectual property and data
  • Special terms and conditions deemed necessary to mitigate risk in conducting business with the entity based on OSPs assessment

Special Requirements for Foreign Entities Receiving a Subaward

  • The DBO is responsible for attaching a copy of the W-8Ben form to each foreign subaward invoice processed by Yale Shared Services (YSS). 

Note:  Do not send these documents to OSP.

It should be noted that foreign subrecipients providing a service to any University in the United States are subject to withholding taxes if they do not have a W-8Ben/EIN# on file with the VCU.  For additional information regarding vendors, DBOs should contact Accounts Payable at 203-432-5394 or sharedservices@yale.edu.

  1. Subaward Activation and Setup Notification to Departments
  • Once a subaward is fully executed, OSP uploads the document into IRES’ PT Agreements folder.  The subaward is then set-up and activated in the Subaward Management System (SMS) by the OGM Set-up unit.
  • The OGM Set-up unit electronically distributes the subaward documentation to the respective DBO based on a list of recipients previously identified by the department and maintained within OSP.
  • The DBO reviews the accuracy of the data reflected on the SMS report against the fully executed subaward and validates the charging PTAO.
  • Any corrections to the SMS record, including adding or changing the PTAO, should be submitted by the DBO to the OGM Set-up unit at ogmsetup@yale.edu.
  1. Subaward Renewals and Modifications

Depending on the sponsor’s funding mechanism, the subrecipient may be issued an amendment to enact changes to the original subaward agreement such as an increase in funding, project period end date, and/or changes in scope of work.  In such cases,

  • The DBO will provide OSP an updated scope of work, detailed budget and budget justification page, change in dates, and compliance assurances/documents as noted in B.1. above, depending on the specific modification. 
  • If sponsor prior approval is required for carry forward unspent funds, the subrecipient must submit a request to Yale. If the Yale PI concurs with the request, the Yale PI/DBO prepares a prior approval request letter to Yale’s sponsor, noting the carryforward amount, and sends the letter to OSP for endorsement. 

Note: Automatic carryforward is not passed on to foreign subrecipients.

  • Modifications to subawards are prepared by OSP and sent to the DBO and PI for review before sending to the subrecipient. 
  • Subawards retain the same SMS Subaward Number until a new Competing Application (in the case of NIH, a competing renewal) is submitted and a new project period begins.
  • Once a renewal or modification is fully executed, IRES’ PT and SMS are updated and the subaward modification documentation is distributed to the DBO.
  •  
  1. Subrecipients Not Included in the proposal
  • The PI and DBO must first confirm with OSP whether or not a subrecipient may be added to the project in accordance with sponsor requirements.  
  • OSP will determine the necessary approval process according to Yale’s prime award and will advise the PI and DBO accordingly. Once an appropriate risk assessment process is conducted and approval is obtained, the review, negotiation, and set up procedures are followed as outlined in this procedure as if the subrecipient were included in the original proposal.
  •  

E.  Processing Subrecipient Invoices

2 CFR Part 200 requires Yale to pay the subrecipient invoices issued under a federal prime award, within 30 calendar days after receipt of the invoice, unless the invoice is believed to be improper. Invoices processed as described below will ensure payment within the 30-day requirement.

  1. Subaward Invoice Receipt

The subaward agreement instructs the subrecipient to send their invoices to YSS. YSS processes invoices daily within the AP system and loads them nightly to the DBOs worklist to start the payment process.

  1. Department Review and Approval of Subaward Invoices

The DBO reviews their worklist and ensures that all subaward invoices are in accordance with the requirements of the subaward and include the following information:

  • subrecipient name
  • date of invoice
  • subaward number
  • subaward amount (prevailing authorized amount)
  • invoice number or reference
  • period of performance covered by the fully-executed agreement
  • period of performance covered by invoice
  • expenditures by major category (e.g., salaries, benefits, supplies, equipment, F&A, etc.)
  • current period costs or clinical services rendered in a specified period, including cost sharing (in sufficient detail to enable comparison to project budget), and cumulative project costs or clinical services rendered, including cost sharing, as compared to the project budget
  • subrecipient contact person with respect to the invoice, if indicated
  • certification on each invoice as to the truth and accuracy of the invoice

DBOs are responsible for reviewing and approving subrecipient invoices for adherence to the budget and the terms and conditions applied to the subrecipient.  The DBO’s signature on the invoice indicates that the DBO review has taken place. If the invoice is incomplete or contains errors, the DBO should contact the subrecipient Financial Contact to request clarification, or a corrected invoice. If the invoice is error free and is deemed accurate, the DBO after signing the invoice should forward the invoice to the PI or his/her delegate for review and approval.

The PI or delegated individual who has knowledge of the project’s technical progress, is required to sign each invoice to acknowledge review of technical progress reports and/or satisfactory performance by the subrecipient.  The approval of the DBO and the PI signifies the invoice was reviewed for reasonableness, that all costs appear appropriate, and the subrecipient is making adequate progress toward the aims of the subaward. The PI’s or delegate’s signature must be on the invoice (pen and ink or electronic signatures are acceptable). Email approvals of invoices are not acceptable.

Once the PI and DBO review and approve the invoice the following steps must be completed for payment of the invoice:

  • Update the PTAEO, add authorizer and the subaward number, and submit through the department’s worklist
  • Scan and submit a copy of the dually approved invoice to yss.subawards@yale.edu
  1. Accounts Payable (A/P) Invoice Validation and Processing

Once the invoice is approved by the DBO and the PI and submitted to A/P, the invoice data on the worklist is validated against SMS ensuring that the:

  • subaward and PTAEO are active for the dates of the provided service;
  • vendor (subrecipient name) is correct;
  • vendor site code associated with the invoice matches the equivalent code in SMS; and
  • invoice payment is within awarded amount.

If the subaward invoice passes validation, payment is processed and issued to the subrecipient.  If the invoice does not pass validation, the invoice will remain “On-Hold” on the YSS department’s worklist.  The DBO should contact OSP for assistance, if necessary.  If an invoice fails validation as a result of an end date (EID) issue, the DBO should reject the invoice on the worklist and request YSS personnel to change the EID date (to be within date of service on the invoice rather than the invoice date). YSS will electronically attach the invoice with original signatures submitted by the DBO to the record for record retention and audit purposes. 

  1. Resolving Invoice Content Issues

If during review of an invoice concerns are identified, the PI or DBO should request clarification from the subrecipient’s PI or request a revised invoice. Specific concerns and actions taken by the DBO and/or the PI to ascertain the accuracy and reasonableness of the invoice must be recorded in the “Comments” section of the invoice transaction on the worklist. 

If the explanation from the subrecipient is insufficient to render a judgment on the allowability of  questioned costs, the DBO should refer the matter to OSP to determine next steps.  If it is determined that the worklist invoice cannot be paid, it should be rejected from the worklist and a specific reason for the rejection provided.

Invoices should not be approved for payment by the PI and DBO until all issues or concerns have been addressed and resolved.

  1. Advance Payments

Accounting procedures for advance payments:

  • The University prefers to pay subrecipients after they have incurred the costs; however, in situations where a subrecipient is not able to cover the costs without an advance, it may be necessary to advance the subrecipient a portion of the funding for the initial period geared toward the subrecipient’s disbursing cycle.  Advance payments must not be made to the subrecipient until a fully executed subaward agreement is in place.  A subaward will not be issued to the subrecipient until all compliance requirements of the federal program or other sponsor requirements, i.e., COI, IRB and/or IACUC, are met.  It must be noted that the funds advanced to subrecipients are not those of the sponsor, but rather are departmental funds.  The departmental account must be identified prior to  issuing the advance to the subrecipient.  The DBO should keep on file the following information regarding the advance payment:
    • Description of the unique circumstances that require an advance payment;
    • Documentation of the PI’s request for an advance payment; and
    • Documentation of approval of the advance payment by the department chair who guarantees the funds.  
  • After a fully executed subaward is set up in the Oracle Grants Management (OGM) system the process can begin to request an advance payment.  Specifically,
  • The DBO must submit a check request for a subrecipient advance payment and submit the request to Accounts Payable.  Expenditure type 102001–Prepaid Expense must be indicated on the check request.
    • All cash advances to a subrecipient must be guaranteed by the department chair (supported by non-sponsored funds).  Should the subrecipient for example, fail to complete the work, the advance is expensed against and financed with departmental funds, not a sponsored award. 

The PI is responsible for authorizing the advancement of funds to the subrecipient.

  • Subsequent advances may occur but must be in accordance with the terms and conditions of the subaward agreement.  In addition, no subsequent advances will be issued unless the subrecipient has submitted an acceptable financial report for a previously issued advance.  

The PI must review and approve the financial report indicating the charges are appropriate to the sponsored award for the work performed. Upon approval of the financial report the DBO must initiate a JSA to reclassify the Expenditure Type from 102001–Prepaid Expense to 833410-Subaward Expense and in accordance with the steps outlined in the Financial Review Checklist. 

Note:  The DBO must ensure the signed invoice(s) and/or financial reports is/are attached to the JSA.

F.  Subrecipient Monitoring

Proper monitoring of a subrecipient ensures that awarded funds are used for authorized purposes only and that the subrecipient is in compliance with the provisions of the subaward.  Monitoring is multi-faceted and requires the participation of the PI, DBO, and OSP to ensure funds are appropriately spent and performance goals are achieved.

  1. Monthly Departmental Subaward Reports:  Ensuring Subrecipient Information is Correct

The Subaward Report is distributed to the DBO on or around the sixth business workday of every month.  The report contains data on all active and pending subawards.  A contact list for distributing the report is maintained by OSP and updated as necessary.  The DBO should review the reports monthly to confirm the information provided is consistent with the set-up documents and that the reports accurately reflect both direct and indirect costs charged to date. OSP should be notified of any set-up errors identified on the report. Charging errors identified by departments should be corrected via Journal Staging Adjustments.

The following is a list of items that appear on the Subaward Report. These items should be reviewed monthly to ensure accuracy of data and transactions:

  • Subaward Number
  • Status
  • Description (includes Yale PI, subaward institution and Subaward PI)
  • Subaward Vendor Name
  • Subaward Vendor Number
  • Yale PI
  • Prime Sponsor
  • Prime Sponsor Award Number
  • Subaward PI (if available)
  • Subaward Start Date
  • Subaward End Date
  • Total Subaward Funding Amount
  • Subaward Total Direct Costs to Date
  • Remaining Direct Cost Commitment
  • Direct Cost Burden Limit
  • Subaward Total Burdened Direct Costs to Date
  • IDC schedule name
  • Subaward Total Indirect Costs to Date
  • Remaining Indirect Cost Commitment
  • Primary PTAEO
  • Subaward Organization Code
  • Subaward Organization Name

Note:  To inquire about a pending subaward or amendment, the DBO should contact their assigned OSP Specialist. 

To request the removal of a commitment on an expired subaward where all invoices have posted, the DBO should contact their assigned OSP Accountant.

To request that a new PTAEO be added to an existing subaward in SMS, the DBO should contact OGMsetup@yale.edu.

To request that a department be added or removed as a recipient of the Distributed Monthly Report, the DBO should contact subawards@yale.edu.

2.   Monitoring of Scientific Progress, Technical Reports, and Deliverables by the Principal Investigator

Monitoring of the subrecipient includes:

  • Reviewing financial and programmatic reports.
  • Ensuring that the subrecipient PI fulfills his/her reporting/deliverables requirements which may include on-site reviews, regular skype, telephone conferences, etc.
  • Issuing a management decision for audit findings pertaining to the federal subaward issued to the subrecipient.

PIs are responsible for monitoring the progress of a subrecipient’s performance in accordance with the subaward’s scope of work.  Such review should generally take place at least quarterly.

In monitoring the performance of the subrecipient, the PI may receive informal progress reports in telephone conversations, e-mail communications, face-to-face discussions, or formal technical reports depending on the terms of the subaward. OSP should be notified in the event that a subrecipient fails to perform the subaward’s scope of work or comply with the terms and conditions.  All required performance/technical/progress reports and other deliverables required by the subaward must be maintained by the PI and DBO in accordance with record retention requirements and for future audit purposes.

There may be instances where the subrecipient has not met or cannot meet the terms and conditions of the subaward agreement, or Yale’s PI is not satisfied with the progress of the subrecipient’s work. In such situations, the PI and/or DBO should contact the OSP award manager to discuss placing additional monitoring and/or reporting requirements for the subrecipient. If the PI and the subrecipient cannot agree to a remedy to bring the subrecipient into compliance with the terms and conditions of the subaward and the completion of the scope of work, the PI has the option of terminating the subaward agreement. 

If a PI chooses not to terminate the subaward, additional conditions may be added to the subaward agreement to bring the subrecipient into compliance, for example:

  • Requiring additional detailed financial reports/invoices
  • Requiring additional project monitoring
  • Requiring the subrecipient to obtain technical or management assistance
  •  Withholding authority to proceed to the next phase of a project until evidence of acceptable performance within a given period of performance is received
  • Establishing additional prior approvals requirements

The PI and/or DBO should contact the OSP award manager to begin the process of terminating the subaward.

  1. OSP’s Subrecipient Monitoring Activities

Quality Assurance

On a quarterly basis, OSP’s Sr. Financial Analyst performs desk reviews of randomly selected subawards.  The selection is comprised of foreign and domestic subawards chosen from subrecipient invoices paid during the preceding quarter.  The desk review consists of the completion of a Subrecipient Questionnaire (SQ) initiated by the Sr. Financial Analyst.  The PI and DBO each respond to their respective portions of the questionnaire. The questionnaire covers financial aspects of the subaward such as, the review and approval of invoices and invoice/budgetary compliance.  The PI responds to questions relating to the ongoing progress of the SOW, provides his/her opinion of the progress, addresses any problems relating to the science, and responds to questions regarding method and frequency of communication with the subrecipient.  The Sr. Financial Analyst reviews the invoices processed in the fiscal quarter for budgetary compliance and compliance with regard to proper invoice authorization and documents all findings in the SQ.  

Additional Monitoring

            At least annually, OSP monitors a subrecipient’s compliance with the terms and conditions of       the subaward.  Activities include but are not limited to:

  • ensuring the timely submissions of performance reports and invoices;
  • the review of audit reports and ensuring deficiencies are addressed in a timely manner by the subrecipient; and
  • management decisions for audit findings are provided to the subrecipient in accordance with OMB Circular A-81, as appropriate.

If the monitoring activity results in findings, OSP may consult with the PI, DBO, the Office of the Controller, the University Research Compliance Officer, and General Counsel to determine what corrective action should be taken.

All monitoring activities are conducted in accordance with OSP’s Standard Operating Procedure:  Determining Risk Level of a Subrecipient and Subsequent Monitoring.

G.  Closeout of Subrecipient Agreements    

  1. Subawardee’s Deliverables

The PI is responsible for ensuring the receipt of all required deliverables, including technical/progress reports, patent invention documentation, and equipment reports from the subrecipient as part of Yale’s required closeout documentation for Yale’s sponsor.   The PI and DBO are responsible for retaining these documents in accordance with sponsor and University Policy 1105:  Retention of University Financial Records. 

Note:  PIs and DBOs should not forward the final subaward invoice to Shared Services for payment until all required deliverables have been received by the PI.

  1. Subawardee’s Final Invoice

The DBO is responsible for ensuring that the subawardee’s final invoice is received in accordance with the terms and conditions of the subaward, verifying with the  PI that all subaward deliverables have been received, and ensuring that all subaward costs are included in Yale’s final financial report.

DBO approval of the final Financial Status Report (FSR) acknowledges that all subaward invoices and deliverables have been received and all invoices have been approved and submitted to Subawards.Invoicing@yale.edu

  1. Subaward Closeout

Subaward/Award Closeout Timeline

When

Action

60 days prior to subaward end date

DBOs should begin reviewing the subaward for closeout.

Within 45 days following subaward end date and in accordance with the terms and conditions of the subaward

DBO/PI receives from the subrecipient all required reports and final invoice for approval of the PI and DBO for processing and payment

By specified date provided by OSP

Final financial report for the award (including subaward final financial information) is sent to OSP by DBO

After award and subaward reconciliation, and by the report due date, (generally no later than 90 days past award expiration  

OSP submits the final financial report to the sponsor

After the completion of all award/and subaward reporting

OSP changes subaward status to “inactive” and initiates award closing process

For additional information regarding please refer to Policy 1301:  Sponsored Projects Financial Reporting and Financial Closeout. 

  1. Subrecipient/Subaward Record Retention

Other than the items identified in G.1. above, subrecipient/subaward information and documentation must be retained consistent with Yale University’s policy on record retention and the terms and conditions of the award whichever is longer.  Refer to University Policy 1105:  Retention of University Financial Records.

Office of Sponsored Projects

  • Verifies subrecipient has submitted a SIC Form or LOI as appropriate, proposal, and supporting documentation prior to Yale’s submission of a proposal 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 SQ.
  • Completes the subaward set-up in SMS and distributes information to DBO.
  • Reviews the subrecipient  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-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.
  • 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 and supporting documentation to OSP prior to Yale’s submission of a proposal, 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 the PI, ensures the subrecipient submits Yale’s SIC Form or LOI as appropriate, proposal, and supporting documentation to OSP prior to proposal submission.
  • Receives subaward agreement from OSP for review and comment.  DBO relays any comments/concerns of the DBO and/or PI to OSP prior to issuance to subrecipient.
  • 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).
  • 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.