Monitoring Subcontracts

Prior to the 2019 audit that the National Science Foundation's Office of Inspector General conducted at UT, the university had already identified the need to increase oversight of subcontracts, specifically outgoing subcontracts tied to prime awards at UT.

Steps had been taken to improve and ensure UT PI involvement and oversight for progress, spending, payments and reporting on subawards. The Invoice Review process was outlined in greater detail and a Subrecipient Invoice Checklist was launched to accompany payment processing to improve compliance.

• Fast forward to present day and now there's a team within Office of Sponsored Projects whose job it is to assess risk against proposed subcontracts.
   
  • This activity happens during the pre-award stage, before a subcontract is issued and it often includes additional requirements to gather financial disclosures from the would-be subrecipient. 
     
  • The steps involved with assessing risk can prolong the process of issuing a subaward, especially if, for example, the proposed recipient isn't very responsive, has a lot of questions or need for additional follow up, or is based in another country and may have different accounting standards compared to U.S.-based entities. 
     
• In addition to the Subcontracts team at the Pre-Award stage whose job it is to assess risk going in, there is also a team that continues to assess and monitor risk across the Post-Award stage.
  
  OSP labels this team rather ambiguously as 'Grants Financial Management - Subrecipient Monitor' and details the following responsibilities (so that you'll have an idea of the kind of monitoring that is supposed to be happening):
   
  • Review and approve subrecipient invoices for payment.
  • Perform desk reviews of subawards as needed to evaluate subrecipient compliance with Uniform Guidance.
  • Maintain list of active subawards including risk level.
  • Annually collect Subrecipient Audit Certification form for on-going subawards.
  • Assist departments with monitoring the spend rate on subawards. <-- Wow! Really? 🤯
  • Assist departments and PIs with trouble shooting issues that arise.
     
• To get a sense of the responsibilities at the local level within units and departments, click through the additional sections below. 

The Office of Sponsored Projects Subaward Monitoring page lays out pre-award, award-stage and post-award roles and responsibilities. It's definitely worth checking out.

At the awarding stage (when the subaward subaccount is being set up in the main account along with its respective terms and conditions), the following is worth highlighting:

• The unit or department is obligated to require financial and technical reports from each subrecipient to adequately monitor progress and fulfill reporting requirements to the main (prime award) sponsor.
   
  • Progress reports should be provided in sufficient time to allow the subaward information to be incorporated into UT’s progress report to the sponsor. Consider proactively adding a series of reminders in your calendaring system to build in the additional time needed for this. 
     
  • What OSP calls 'UT's progress report to the sponsor' is probably more accurately called the UT PI's progress report to the sponsor. The UT Post-Award Specialist typically assists with creating the financial reporting but the PI is usually the one who pulls together and submits the project report.
     
    • OSP is probably trying to highlight that as a university, they are on the hook to ensure compliance for each subrecipient, but just to be clear, it's the UT PI who typically handles reporting, with assistance from their unit research administrator.
       
  • As a Research Administrator, it's your job to make sure the reporting requirement is on your PI's radar, as well as to reach out and coordinate with the OSP Post-Award Specialist to obtain the financial report, which often times is either incorporated into the overall project report or is sent along with the financial report.
     
    • Again, adding a series of proactive reminders in your calendar will go a long way toward ensuring these things are taken cafe of and that the subaward remains compliant. Then you won't have to hold onto this in your memory banks, so to speak. You'll get the reminders and ping your PI, job done.
       
      • Make sure the reminders continue until the PI confirms the reports have been submitted and then you can end the notifications.
         
• Review the Statement of Work (SOW), budget, period of performance, payment terms, and whether or not unspent funds are allowed to roll over (carry forward) into the next year.
  .
  • Again, the Research Administrator's role is to ensure compliance, so reviewing the details of the award goes a long way toward managing it efficiently.
     
• Review UT sponsor’s award terms and conditions with OSP and the subrecipient to ensure all requirements can be met by subrecipient.
   
  • This itypically happens between the OSP Subcontract team and the proposed Subcontract team with the Research Administrator copied on the exchange. 
     
  • If anything about the subcontract or its subaccount looks off or needs to be clarified, this stage is the time to do it - such as when there might be issues with the naming conventions in the subaward budget that may not have been categorized clearly (or correctly) based on what UT calls certain costing categories.
     

There is a recommendation on OSP's Subrecipient Monitoring site that each unit should craft a plan to monitor subcontracts that have been deemed high risk. Hopefully, OSP will soon provide a template that would make it easier to incorporate such a plan into our efforts. 

OSP's post-award sub monitoring resource splits up responsibilities between the unit/dept and the research administrator, probably to demonstrate unit vs. individual roles, but in practice, it's the Research Administrator holding down most if not all subcontract responsibilities, especially when the Research Administrator is also the Department Manager or Unit Administrator. 

Here's the list of duties at the Dept/Unit level, per OSP:

• OSP: Monitor subrecipient technical progress and adherence to terms of award and cost sharing requirements.
   
  • RSO Note: The lead PI is likely the only person who can monitor the technical progress of a subcontract team. The requiring of progress reports accomplishes exactly that, so this seems somewhat redundant. The Grant Admin should be the one monitoring for adherence to terms of award and cost sharing requirements. 
     
• OSP Review invoices. Please see the Invoice Review Guidelines below for guidance.
   
  • RSO Note: This seems like something more clearly assigned to the Grant Admin. Obviously, invoices will need to be reviewed at each approval level, so whomever the department approver is in the routing of vouchers processed will already be 'built into' this process.
     
• OSP: Subaward Amendments - Assess need to modify statement of work, budget, period of performance.
   
  • RSO Note: This seems like something the Grant Admin and PI should be discussing and keeping an eye on, in concert with the collaboration between the UT PI and the subrecipient team.
     
• OSP: Plan for a timely closeout - check status with subrecipient 90 days before end date, follow up on any late or missing reports, ensure subrecipient submits a final invoice on time and marked FINAL.
   
  • RSO Note: This one falls squarely on the Grant Admin.
    
    The Office of Accounting and Financial Management sends auto-generated email reminders when accounts reach the 90 day window in advance of expiring.
     
    • If the end date of the subaward matches the end date of the prime UT award, then this auto-message suffices as a reminder system for ensuring subrecipient closeout compliance, though feel free to add proactive reminders to help manage the process.
       
    • If the end date doesn't match, add calendaring reminders to anticipate when the 90 day window begins for subawards and send requests accordingly.
       

 Reach out if you want to talk about any of what's outlined here.
Obviously, monitoring subawards has become 'a thing' and we want to make sure we land compliantly. 

Panel 4. Add body text in this space.

Panel 5. Add body text in this space.