Purpose
The College of Wooster (College) will consider issuing a subaward when necessary to augment the College’s core capabilities in carrying out sponsored research or other projects and when the sponsoring entity has approved the subaward and subrecipient.
The College is ultimately responsible for a subrecipient’s use of federal and other grantor funds. Uniform Guidance requires that the College establish a system of internal controls to ensure a subrecipient uses federal funds in accordance with laws, regulations, and provisions of contract/grant agreements.
Specific monitoring requirements for federal award subrecipients are contained in OMB Circular A-133 and the accompanying Compliance Supplement. This document presents the College’s policy and procedures to implement necessary controls and ensure compliance with federal regulations, grantor policies, and internal College policies with regard to sponsored activities in the pre-award and postaward phases.
Scope
These policies and procedures apply to all College departments, offices, faculty, administrative personnel, and staff personnel who are involved in the conduct or oversight of sponsored activities, wherein a portion of the activity will be conducted through a subaward.
Responsibility
The Principal Investigator (PI) /Project Director (PD), Associate Director of Sponsored Research (Associate Director), Senior Grants Accountant, Office of Academic Affairs, and Subrecipient each share in the responsibility to successfully manage subawards. These policies and procedures are intended to delineate the role of each party in that process.
Initiation
Eligibility
To be considered for a subaward from the College, the potential Subrecipient must meet the eligibility requirements of the prime grantor and must be either a domestic institution of higher education or a research foundation closely associated with a domestic institution of higher education.
Required Forms
If a College PI/PD plans to include a subaward to another institution in an upcoming proposal, a number of documents must be obtained from the intended Subrecipient in advance of the submission.
(For a full description of the requirements and responsibilities of a Subrecipient, see page 1 of the Subrecipient Commitment Form.) The Director will be responsible for obtaining these documents, which include but are not limited to:
- A statement of work
- A detailed budget and budget justification
- The facilities and administrative cost rate agreement
- Evidence of commitment to participate in the project and abide by all the associated terms and conditions
Inclusion of costs in proposal budget
When a budget is prepared for a proposal that includes an outgoing subaward, the total of the subrecipient’s direct and indirect costs will be included in Wooster’s budget, either as grant-funded costs or as matching costs.
Risk Assessment
It is the College’s policy to mitigate risk by pre-qualifying a potential Subrecipient so that a variety of financial and organizational information is known about the Subrecipient early in the process.
As part of the risk assessment, in addition to requesting the above-mentioned required documents, the Associate Director will obtain a completed Subrecipient Commitment Form from the intended Subrecipient to learn more about the financial and nonfinancial compliance processes and internal controls of the other institution. The Director will also review the Federal Audit Clearinghouse to ascertain the results of the intended Subrecipient’s most recent A-133 audit and will search public records for debarment.
The Associate Director will pass results of the inquiries along to the Senior Grants Accountant. If the Vice President for Finance and Business, the Controller or the Senior Grants Accountant determines there are minimal risks based on the information received, the Office of Academic Affairs will move forward with the proposal and include the subaward. If it is determined that disclosed noncompliance or material weakness pose significant risks, The College of Wooster will not include the subaward in
the grant proposal.
College of Wooster PIs/PDs are encouraged to provide information to the Associate Director and the Senior Grants Accountant about a potential subaward early in the process of planning for a grant. Should there be a determination that it is too risky for the College to contract with the potential Subrecipient, Wooster PIs/PDs will then have enough time to find alternate ways to work on grants with the other institutions. Wooster PIs/PDs are also encouraged whenever possible to submit collaborative grants proposals instead of proposals with subawards as collaborative grants involve less risk and cost for the College to administer than grants with subawards.
Execution of Awarded Grants
Process
When the Office of Academic Affairs receives a fully-executed award from the prime sponsor with a budget that includes a subaward, the Director will prepare a subaward agreement, have the designated Authorized Individual review the agreement, and then send it to the intended Subrecipient. Once negotiations are complete and the signed subaward agreement is returned, the College’s Authorized Individual will execute it on behalf of the College and the Associate Director will return a copy of the complete Agreement to the Subrecipient.
Standard Terms in a Subaward Agreement
A subaward agreement will generally include terms and conditions that address the following as appropriate:
- Implementation of any appropriate and necessary risk mitigation strategies
- Mandatory flow-down provisions from the award to Wooster, such as the requirements of certain laws, regulations, and grantor conditions, as applicable
- Non-financial reporting requirements
- Period of performance and termination
- Financial terms and conditions including but not limited to: fixed price or cost reimbursement, billing requirements, and payment terms
- Ownership of intellectual property and data
- College and appropriate external audit agency access to the records and financial statements when deemed appropriate by the College and/or its sponsor
- Certification of invoices that the costs conform to the conditions of allowability and support the performance of the work identified in the agreement
Subawards issued under a federal prime award will also include the following information as required by OMB Circular A-133
- Catalog of Federal Domestic Assistance (CFDA) title and number
- Award (project title, sponsor number, and year)
- Type of award (e.g. Research & Development)
- Name of federal agency sponsoring the award
- Compliance with OMB Circular A-133 requirements regarding the reporting of any problem related to the subaward identified in their annual audits and to submit corrective action plans for review by the College
Subaward Renewal
The College will issue a subaward modification, amending the original subaward to extend the period of performance and provide additional funding in accordance with the sponsor’s requirements. The Associate Director will be responsible for preparing and issuing the subaward modification, which must be approved by the Authorized Official prior to issuance.
Other Subaward Modifications/Amendments
Any other subaward modification/amendment that is required, including but not limited to funding increases and decreases, date extensions, and early terminations must be handled by official modifications to the agreement issued by the College.
Subawards after the Prime Award is Established
If it becomes necessary to issue a subaward not outlined in the originally-funded proposal, the PI/PD must prepare in writing a letter to the prime sponsor that addresses the necessity of the subaward and the reason for selecting the particular Subrecipient to complete the work. This letter must be signed by the Provost or the Dean for Faculty Development prior to submission to the prime sponsor. Written permission must then be obtained from the prime sponsor before the College will issue any such subaward not outlined in the originally-funded proposal.
Monitoring
The Controller has ultimate responsibility for determining the activities that will be undertaken to evaluate subrecipient organizations annually, as well as to communicate changes in the subrecipient risk profile to determine what corrective actions should be taken. The Associate Director and Senior Grants Accountant will regularly gather updated information and documentation on the subrecipient institution, financial stability, and financial processes and controls including but not limited to:
- Annual audited financial statements
- Annual audit reports and/or A-133 audit certification letters
- Certification that institutional management letters do not indicate any control weaknesses
Additionally, the following approaches may be used to learn more about the subrecipient and confirm risk profile:
- Desk audits of a sample of sub-invoices
- Site visits to review processes, systems, and controls
- Other procedures as deemed appropriate
Progress Monitoring, Programmatic Reports, and Deliverables
The PI/PD is responsible for determining whether the subrecipient scope of work is on schedule, using a variety of means to make this determination. These can include but are not limited to:
- Reviewing and evaluating the progress of programmatic reports or other deliverables through phone conversations, email communication, or face-to-face discussions to make periodic determinations about the overall progress
- Collecting, reviewing, and evaluating programmatic reports in a timely manner
- Identifying unusual or unforeseen items outlined in or omitted from the programmatic reports and reporting them to the Director
All programmatic reports should be stored on the computer in a shared drive accessible by the Associate Director, the Senior Grants Accountant, and the Office of Academic Affairs.
Financial Reports / Invoices
The PI/PD and Senior Grants Accountant will work together to review invoices from the Subrecipient to ensure that all are consistent with the established scope of work. The Senior Grants Accountant will receive the invoice from the Subrecipient and review it to ensure it meets the standard format and is calculated accurately. The invoice will be forwarded to the PI/PD to ensure that charges are as expected and do not represent a significant over-expenditure, or under-expenditure, against the budget.
If, after review, an issue or concern is identified, the Senior Grants Accountant may request detailed justification including, but not limited to:
- Payroll records/data
- Time and effort Certifications
- Copies of paid invoices
- Description of services rendered by consultants
- Details of incurred travel charges
Closeout
The Associate Director is responsible for obtaining all required deliverables, including programmatic reports and any other necessary documentation. Final verification of technical/programmatic completion of the project by the subrecipient is indicated by the PI’s approval on the final invoice. Payment for the final invoice will not be made to the Subrecipient until all required deliverables have been received by the College.
Award Closeout
A subaward may not be formally closed until all applicable closeout requirements are received. They may include but are not limited to:
- Final technical/programmatic report
- Final financial report/invoice
- Final audit notification
The Associate Director and Senior Grants Accountant will strive to begin subaward closeout review prior to the conclusion of the subaward period of performance to allow adequate time for the PI to make any budgetary actions or requests for extension to the sponsor. Everything (except perhaps the final audit notification) should be received within a period that allows for completion of all reviews well before due dates for the final reports associated with the prime award.
Exceptions
The Controller must approve any exceptions to this policy in writing.
Approved June 4, 2013