The Catholic University of America

Subrecipient Monitoring Policy

 
Approved by:
 
President
 
History:
Issued    -- July 30, 2015
 
 
Revised
 

 
 
Related Policies:
 
Additional References:
 
 
Responsible Official:
 
Director, Sponsored Accounting tel. (202) 319-6402
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I.          Policy Statement
 
The University’s acceptance of Sponsored Awards (defined below) requires good stewardship of those funds. When the University enters into a subaward of those funds, the subrecipient must assume financial and programmatic responsibility for the subawarded funds. Nevertheless, the University retains overall responsibility for the award, and therefore must monitor each subrecipient. This policy sets forth the obligations of the University and the Principal Investigator (PI) with respect to subrecipient monitoring. 
 
This policy applies to all subawards and subrecipients regardless of funding source (i.e., federal versus non-federal).
 
II.         Definitions
           
A.         Principal Investigator (PI) means the person responsible for performance of the activities specified in the grant or contract. Usually this person is named in the grant or contract agreement.
 
B.         Sponsored Award means a grant, contract or other methods of funding provided to the University by an external entity (such as the federal government or a private foundation or company) and for which there are actual or implied conditions or expectations that the University must meet. Such conditions and expectations often include, but are not limited to:
 
        sponsor control of the scope of the project;
 
        technical, financial, or progress reporting;
 
        a cost sharing component;
 
        recoveries for facilities and administrative (i.e. indirect) costs; and/or
 
        re-granting or subcontracting of some of the funds to other entities. 
 
Sponsored Awards often involve activities such as research, teaching/training, or the provision of services by University personnel to other entities.
 
C.         Subrecipient means a non-federal entity that receives a subaward from a pass-through entity to carry out a part of a federal program; but does not include an individual that is a beneficiary of such program. A subrecipient may also be a recipient of other federal awards directly from a federal awarding agency.
 
D.         Contractor means an entity that receives a contract. A contract is a legal instrument by which a non-federal entity purchases property or services needed to carry out the project or program under a federal award.
 
E.         Subaward means 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. It does not include payments to contractors, or to an individual who is a beneficiary of a federal program. A subaward may be provided through any form of legal agreement, including an agreement that the pass-through entity considers a contract.
 
III.         Determination of Subrecipient versus Contractor
 
Subrecipients are subject to different rules and regulations from Contractors. Accordingly, the University will review each agreement that involves disbursing program funds (whether federal or non-federal) to a third party in order to identify whether the recipient is a Subrecipient or a Contractor. Disbursements to Subrecipients are governed by this policy. Disbursements to Contractors are addressed in the University’s Independent Contractor Policy and Procurement Policy.
 
IV.        Monitoring Activities
 
The University will evaluate subrecipients to assess their ability to meet programmatic objectives and manage the subaward funds appropriately. Evaluation activities may include subrecipient pre-screening, verification of audits as required by federal Office of Management and Budget (OMB) requirements¹, review of financial or rating agency reports, ongoing communication, and/or site visits if required.
 
The PI for a Sponsored Award has primary responsible for ensuring the validity and appropriateness of all activities performed in pursuit of that award’s goals. Therefore, it is the PI’s responsibility to ensure that any work performed by a subrecipient is appropriate. A PI, or their designee, must review all subrecipient expenditures thoroughly to determine that all work is performed as stated, is consistent with the award terms and federal costing requirements, and is invoiced properly. 
 
The Sponsored Accounting Office is responsible for reviewing regularly all active subrecipients and monitoring subreceipent compliance, paying particular attention to those that are deemed to require closer scrutiny in light of considerations including, but not limited to, the following:
 
        The University's current and prior experience with the subrecipient;
 
        The amount of the program award passed through to the subrecipient in relation to the total award;
 
        The complexity of the award, sensitivity of the work and/or scope of governing regulations;
 
        The international location of the subaward or subrecipient;
 
        The for-profit status of subrecipient;
 
        The financial system and internal control processes over federal awards; and
 
        The audit results and corrective action plan.
 
Sponsored Accounting Office is responsible for reviewing subrecipient audit reports to verify that the subrecipient has completed the Subpart F - Audit Requirements and to assess the implications of the audit findings, if any. In the case of audit findings, Sponsored Accounting Officeis responsible for reviewing the subrecipient’s corrective action and for recommending any actions to be taken by the University. For entities not subject to the Uniform Guidance Audit Requirements, for-profit, and/or foreign entities, Sponsored Accounting Office may request audited financial statements.
 
 
 
¹ For awards effective December 26, 2014, following OMB Uniform Guidance (2 CFR §200). For awards effective before December 26, 2014, follow OMB Circular A-21, Cost Principles for Educational Institutions (2 CFR §220) and/or OMB Circular A-110 (2 CFR § 215).