OGC Brown Bag March 20/27 th 2014

1. OGC Brown BagMarch 20/27th 2014 Subcontract Implementation & Subrecipient Monitoring

2. New Requisition • Established SPO • Which to use? Subcontracts in Marketplace Quick Tip!!!! Same Project Number = Same SPO

3. New Requisitions Use the “SPO – Sponsored Project Subcontract” form for all Subcontracts or Amendments which require new requisitions.

4. 492600 – Subcontract 1 – 1st $25,000 • 492601 – Subcontract 1 – Greater than $25,000 • 492610 – Subcontract 2 – 1st $25,000 • 492611 – Subcontract 2 – Greater than $25,000 • 492620 - Subcontract 3 – 1st $25,000 • 492621 – Subcontract 3 – Greater than $25,000 • BOULDER: • 492742 – UCB Subcontract 1 – 1st $25,000 • 492743 – UCB Subcontract 1 – Greater than $25,000 • COLORADO SPRINGS: • 492744 – UCCS Subcontract 1 – 1st $25,000 • 492745 – UCCS Subcontract 1 – Greater than $25,000 Which Account Code do I Use for Requisitions?

5. Established SPOs Please be sure to select the correct people here. (Joseph Knittel) Amendments should be added via a comment in Marketplace on the established SPO.

6. SPO Invoice Allocation Form Subcontractor invoices should be accompanied by this form up to the first $25,000 of every invoice. APInvoice@cu.edu

7. OMB Circular 110: § 215.5 • Unless subrecipients are specifically excluded from coverage, the provisions of this part shall be applied to subrecipients performing work under awards if such subrecipients are institutions of higher education, hospitals or other non-profit organizations • OMB Circular 110:§ 215.51 (a) • Recipients are responsible for managing and monitoring each project, program, subaward, function or activity supported by the award. • Recipients shall monitor subawards to ensure subrecipients have met the audit requirements as delineated in § 215.26 Sub-recipient Monitoring Federal References

8. Continuous on-going communication • Require periodic reports • Schedule site visits • Require additional prior approvals • Review single audit results • Arrange for “desk reviews” of documentation and reports – request supporting documentation for selected line item transactions • Limited-scope audits Possible Monitoring Methods

9. Considerations: • What is the Subrecipient’s experience with administering federal awards and subawards? • Determine the Subrecipient’s past performance of award management. • How complex is the Subcontract? • How is the quality and accuracy of the invoices and supporting documentation? Which Method(s) to use?

10. Requested documentation is accurate and complete as compared to sub-contract terms • Expenses are Required for the Scope of Work Allowable, Allocable and Reasonable Fully supported (including allocation methods) • No duplication of expenses (both direct and indirect) • Expenses align with the Budget Narrative, Scope of Work and match progression of the project • Identification of any high unit costs or unusual costs Subrecipient Monitoring Goals

11. Tools from the Subcontract Modified Subcontract language as of July 1, 2013 Subrecipients are required to provide transaction-level financial reports with invoices (new) Right to audit the Subrecipient Additional restrictions can be added to assist with subrecipient monitoring!

12. Thank you! OGC.Subcontracts@ucdenver.edu If you have additional questions, please feel free to contact us

13. UC Denver Office of Grants and Contracts Discussion Notes from 3/20/14 and 3/27/14 Brown Bags Sub-recipient Monitoring • New term contained in out-going sub-contracts requires a transaction-level report from the sub-recipient’s General Ledger (G/L) to accompany the invoice. • This provides the itemized source document (equivalent of a receipt) for departmental fiscal staff to determine if expenses are allowable, allocable and reasonable prior to approval of invoice. • If you have questions about the composition of a specific expense it is the departmental fiscal staff’s responsibility to obtain needed clarification of (1) what the expense is for and how it is required in order to meet the scope of work, and (2) if the allocation method is reasonable based on what the type of expense. • OGC can certainly assist with the allowability determination once the above information is obtained or if there are questions related to the sub-awardee’s systematic accounting flows/models related to direct and indirect costs.

14. UC Denver • Office of Grants and Contracts • Discussion Notes from 3/20/14 and 3/27/14 Brown Bags • Sub-recipient Monitoring • Issues related to late payments of invoices. • Subcontract includes a contractual term that requires the final sub-award invoices to be issued/received within 60-days after the budget end date. Any invoice received after this deadline can be refused and not paid by UCD. This is ultimately the PI’s decision. • Ramifications of invoices being paid after FSR has been submitted: • If service dates of invoice are for prior budget year: The award amount on the NGA/NOA (and therefore the budget amount in PeopleSoft) is now outdated due to the carry-forward amount being affected by the amount of the late invoice. The more budget years back the invoice is for , the more years’ budgets are outdated and the longer it will take for all modified FSR’s to be submitted, accepted by NIH and revised NGA/NOA to be issued. Since the revised NGA/NOA is what is required to update the current budget in the G/L, the timeline to bring the current year’s budget up-to-date can be very lengthy. • Until all such modifications come through the NIH and UCD systems, all budgets must be tracked or adjusted manually by the PI’s fiscal staff. • Not tracking the adjusted budget manually can result in funds being spent twice, and unintended budget and cash deficits.

15. UC Denver • Office of Grants and Contracts • Discussion Notes from 3/20/14 and 3/27/14 Brown Bags • Sub-recipient Monitoring • Would it be helpful to define a cut-off for FSR revisions? To assist with avoiding the above issues, a possible change in process was shared. Specifically, the change in process under consideration is to define a timeline with a cut-off for FSR revisions. NIH policy states that revised FSR’s can be submitted up to 15 months after the budget end date. In order to avoid circumstances related to late payment of invoices, and to align with this NIH policy, OGC is asking your help to provide feedback about implementing a 15-month deadline for revisions to FSR’s. If there are significant issues – for example, corrections for audit findings – these will be handled on a case-by-case basis. We would appreciate your thoughts and feedback on this idea and its related ramifications.

16. UC Denver • Office of Grants and Contracts • Discussion Notes from 3/20/14 and 3/27/14 Brown Bags • Sub-recipient Monitoring • Document standard F&A application examples in process documentation: It was discussed that it would be helpful to include in OGC standard business terms and processes the four frequent examples of F&A application methods that our sponsors use. OGC will add this to their documentation. • Some Marketplace process questions were posed: OGC will follow up with the PSC and distribute additional information via the OGC Listserv.