A subaward is 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 (UG §200.92). When UCI subawards a portion of an award to another entity, UCI becomes a pass-through entity.
Since the implementation of Uniform Guidance, pass-through entities are directly accountable to the sponsor for the subrecipient’s performance and compliance – this requirement necessitates closer subrecipient monitoring.
Pass-through entities must monitor the activities of subrecipients to ensure that the subaward is used for authorized purposes, subaward performance goals are achieved, and the subrecipient is in compliance with Federal statues, regulations, and the terms and conditions of the subaward (UG §200.331).
Pass-through entity monitoring of the subrecipient must include:
- Reviewing financial and performance reports required by UCI;
- Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award; and
- Issuing a management decision for audit findings pertaining to the Federal award provided to the subrecipient from UCI.
Depending on the evaluation of the subrecipient’s risk of noncompliance, the following monitoring tools may be useful for the pass-through entity to ensure proper accountability and compliance:
- Training and programmatic assistance;
- On-site reviews of program-related operations; and
- Incorporation of additional sanctions and procedures.
The project PI and departmental research administrators are required to ensure that invoices from subrecipients are reviewed before they are approved for payment. Project and invoice monitoring includes the following steps:
- Reviewing invoices against the approved budget and verifying that costs are appropriate for the work performed;
- Verifying that costs are in alignment with cost principles;
- Ensuring that invoicing is occurring according to the schedule outlined in the terms and conditions of the subaward;
- Ensuring that subrecipients submit a final invoice for project expenses at the end of the project, and such an invoice is marked “final.”
The PI signs and approves all non-UC subrecipient invoices for payments. Department administrators should also sign/initial to confirm that expenses are allowable and that funding is available.
If the project PI or department administrator have questions regarding the allowability of an expense, they should contact C&G Compliance or SPA.
Fixed Amount Subawards
A pass-through entity may provide subawards based on fixed amounts of up to $250,000 (the current Simplified Acquisition Threshold) (UG §200.332).
In order for a pass-through entity to provide a fixed amount subaward, it must meet the following criteria:
- Prior written approval for a fixed amount subaward received from the sponsor;
- The project scope is specific;
- Adequate cost, historical, or unit pricing data is available to establish a fixed amount award based on a reasonable estimate of actual cost; and
- Payments are based on meeting specific requirements of the Federal award.
Under a fixed amount subaward, milestones/deliverables are established, and each assigned a lump sum amount. As the subrecipients meet those milestones or their deliverables are accepted, they may invoice for the corresponding amounts.
Accountability for fixed amount subawards is based primarily on performance and results.