Managing Subawards

Introduction

Within a research project, investigators may wish to collaborate with other institutions or entities to complete a portion of the project scope. For example, UNL as a prime recipient might enter into an agreement called a “subaward” or “subcontract” with other institutions (subrecipients). The subrecipient would be required to provide the resources necessary to complete a portion of the project scope as a semi-independent project. This includes provision for a responsible investigator at the collaborating institution or entity.

A subaward should not be mistaken for a vendor agreement (purchase order). A vendor typically provides goods or services to many different purchasers. Unlike a subrecipient, a vendor does not have a principal investigator assigned and the goods or services provided don’t directly support project goals. Instead, the UNL investigator uses the goods or services to accomplish project goals.

The intent to subaward a portion of the award should be included in the proposal to the sponsor. If a need for a subaward is determined after the award has been made, the terms and conditions of the award or the regulations covering the award should provide direction about requirements for prior sponsor approval of this subaward.

The Office of Sponsored Programs – Post-Award will formalize the agreement into a subaward or subcontract based on information contained in the proposal or from additional information from the investigator. In order to allow for a timely project closeout, these subawards typically end at least 30 days prior to the end of the prime agreement with UNL. If the collaboration is with one of the other NU system campuses, it is called an “intra-institutional” agreement.

Preparation and Negotiation of Subawards

When Post-Award receives an award that contains a proposed subaward, the Project Specialist assigned to the college or department will draft and negotiate the subaward agreement. Items needed for this negotiation include the:

  1. beginning and end dates of subaward
  2. amount of funding to be provided
  3. budget for work to be performed by the subrecipient
  4. PI and institutional contact information
  5. scope of the subrecipient’s work
  6. definition of and due dates for, any technical reports to be submitted to the PI
  7. information about the potential regulatory committee approvals that will be needed for the work being conducted at the subrecipient’s work site.
  8. special requirements, if any, that the PI wants to include in the award

The financial terms and conditions for the subaward will be negotiated by Post-Award. Once an award is negotiated, Post-Award will submit it to UNL’s Business and Finance Office and the subrecipient for signature.

Administration of Subawards

Financial– Invoices sent to UNL will be processed in accordance with the established procedure for the award. UNL has the responsibility to adequately monitor all subawards for compliance with terms and conditions of the award. The Project Specialist assigned to the college or department will determine risk assessment with input from the department or PI, if needed. The risk assigned will determine the level of review needed prior to payment of any invoice. In most cases, invoices are processed by Post-Award. The PI or his/her department financial staff may review invoices prior to payment and are encouraged to do so for subrecipients determined by Post-Award to be medium or high risk. For more information about factors that Post-Award uses to determine a subrecipient’s level of risk, see UNL Subrecipient Risk Assessment and Monitoring. Amounts exceeding the dollar amount included in the subaward agreement will not be paid. Payments will be made in accordance with the terms specified in the award, but, except for final payments, they typically aren’t made more often than quarterly or for amounts less than $500.

Technical– Ultimate responsibility for the conduct and completion of the project rests with UNL as the prime award recipient. Subaward progress reports should be reviewed by UNL’s principal investigator. If the subaward does not require periodic progress reports, UNL’s principal investigator and the subrecipient principal investigator should communicate often to ensure adequate progress is being made. If the subrecipient is not performing adequately, Post-Award should be notified immediately so that payment can be suspended if needed.

Subrecipient Risk Assessment

In order to insure that UNL is providing adequate subrecipient monitoring, a form has been developed to assess the risk of financial loss to UNL. Based on Post-Award’s assessment of a subrecipient’s level of risk, UNL will provide greater or lesser monitoring of subawards. Some of the factors that determine risk levels include prior agreements with the institution or entity, audit findings for the institution or entity, and the dollar amount of the subaward, etc.

Subreceipient Risk Assessment Form

Amendments

Contact your Project Specialist in Post-Award to amend any portion of the subaward agreement. Changes in the scope of work being performed or of the subaward institution PI may require sponsor approval.

Closing Requirements

Final payment to the subaward recipient will be contingent upon a final invoice and an acceptable final technical report. The principal investigator may be required to approve payment of the final invoice. If the department or principal investigator has any concerns about the work performed by the subrecipient, Post-Award should be notified immediately so that payment can be withheld until the concern is satisfied. For this reason, it is essential that departments maintain close communication with Post-Award as the end date of a subaward approaches.