Subrecipient Agreements CLASP Presentation January 2018 Jeff Sullivan, Asst Controller ORACS

Agenda Required Oversight for Federal Awards DUNS/CFDA UR Business Process Flow Roles Potential Pitfalls Foreign v Domestic Public/Private/Single Audit/No Audit/etc. URFinancials Setup and Processing

Required Oversight – Uniform Guidance A pass-through (Prime) entity must: Identify the Award and Applicable Requirements (to the Sub) Evaluate Risk (of the Sub) Monitor Subrecipient Ensure Accountability of For-Profit Subrecipients

Identify the Award and Applicable Requirements Notify Sub they are in fact a Sub, including CFDA and FAIN of Prime AWD What, if any, requirements are imposed upon them via flowthrough What, if any, additional requirements are imposed from the Prime recipient Obtain DUNS number from Sub, if applicable

Evaluate Risk (of the Sub) Prior experience w Sub Results of Sub’s prior audits Personnel Turnover or System Changes Extent and Results of Federal awarding agency monitoring, if applicable

Monitor Subrecipient Review Financial and Programmatic Reports, as required Ensure that any compliance deficiencies identified through audit, on site review, or other means are resolved timely and appropriately Issue a management decision for audit findings pertaining to the Prime award passed through

Ensure Accountability of For-Profit Subrecipients For-Profit Subs are accountable to the Prime for the use of Federal funds provided 2 CFR 200 Part F is not applicable to For-Profit Subs, therefore the Prime is responsible for establishing requirements, as necessary The agreement must describe applicable compliance requirements and responsibility

DUNS/CFDA The Data Universal Numbering System, abbreviated as DUNS, is a proprietary system developed and regulated by Dun & Bradstreet (D&B) that assigns a unique numeric identifier, to a single business entity. It was introduced in 1963 to support D&B's credit reporting practice. The Catalog of Federal Domestic Assistance, abbreviated as CFDA, is a government-wide compendium of Federal programs, projects, services, and activities that provide assistance or benefits to the American public.

DUNS/CFDA (con’t) DUNS allows for tracking of the Sub, disclosure of possible prior sins either via credit report or Single Audit Reporting CFDA allows a Sub to report on what Federal funds are flowed through their organization, and if necessary, report on Each reverse disclosure is mandatory under Uniform Guidance

UR Business Process Flow Pre Agreement PI/Dept ORPA ORACS (upon req) Post Agreement PI/Dept ORACS ORPA (upon req)

Pre Agreement Roles PI/Dept ORPA Identify Sub and Qualify Expertise Determine/conclude reasonable budget Prepare Request for Subcontract Form Send Form to ORPA ORPA Prepare and Send Sub Profile Form Complete Risk Assessment Checklist Conclude on Risk Level of Sub Execute/Discard Agreement

Post Agreement Roles PI/Dept ORACS Review expenses reported v science performed Compare actual expense to budget Ensure expenses are within budget period Forward to ORACS Confirm terms or deliverables made prior to FINAL payment ORACS Review for PI Approval Review Accounting Coding (LA,SC) Review Budget Date Forward to AP Obtain Single Audit Certifications Annually Prepare Single Audit Findings Summary

Potential Pitfalls Misdiagnose Risk Keying Errors in Agreement Keying Errors in Payments (Amt -Budget Date) Approve excess expenses Misplaced Invoices Delinquent Invoices from Sub Overbilled and Subsequent Return of Funds Failure to aquire required data

Foreign v Domestic Domestic Foreign Many are subject to Single Audit Ease of Risk Assessment of Audited Fin Stats Listed in SAM.gov Foreign Rarely subject to Award Specific Audit Currency and Translation Issues Not listed in SAM.gov

Public/Private/Single Audit/No Audit/etc. Public Co and Private Owned, unlikely to have a Single Audit Private Owned, unlikely to have a Board of Directors (segregation of duties) Private Owned and Start Up, unlikely to have Financial and Compliance Experience Small Non-Profit, usually segregation of duties isssues and lack of financial expertise

URFinancials Setup Modified Total Direct Costs – MTDC $25,000 threshold Unique Award Line (GR) Current Federal incremental is 54% or $13,500 Total Direct Costs – TDC NO threshold Unique Award Line NOT NEEDED Usually run at less than Full Rates

URFinancials Processing Subcontract will identify GR510xxx If agreement is extended we do NOT NEED new GR, unless prime line is void of carryforward. If a new scope of work, then NEW PO#, and NEW GR and Award Line If Sub demands NEW PO#, NOT NEW scope of work, then edit existing GR name