1. TRAINING MODULE II: PART II SUBCONTRACTS AND SUBAWARDS Office of Contract and Grants The University of Colorado at Boulder February 16, 2012 1

2. SPONSORED RESEARCH SUBCONTRACTING 2

3. MARKETPLACE GOODS & SERVICES  Department works with PSC https://www.cu.edu/psc to identify vendors/suppliershttps://www.cu.edu/psc  Vendor/Supplier provides goods and/or services in the course of its normal business operations  Paid for on Purchase Orders issued by PSC Is a purchase order a contract? 3

4. 4  Department works with PSC https://www.cu.edu/psc/ to hire a special expert  Usually an individual or firm that advises and consults on a specific project requirement(s)  Hired pursuant to a consultant services agreement issued by PSC Is a consultant services agreement a contract? CONSULTANT SERVICES

5. SUBCONTRACTS & SUBAWARDS Entity is responsible for a substantial piece of the research project and is contributing to the body of knowledge & funded public purpose Statement of Work and Budget Performance Requirements Period of Performance Deliverables Budget Line Items Budget Justification Total Budget (sum to be encumbered) 5

6. SUBCONTRACTS & SUBAWARDS Subcontract  Federal Acquisition Regulations or industry terms apply  Select terms of the Prime contract flowdown  Negotiated and issued by OCG Subrecipient Agreement (“Subaward”)  Issued pursuant to a federal financial assistance award (i.e. grant, cooperative agreement)  Select terms of the grant or cooperative agreement flowdown  Negotiated and issued by OCG 6

7. SUBCONTRACTOR/SUBRECIPIENT PROPOSAL  Letter of Commitment  Scope of Work (technical proposal & detailed schedules)  Budget with justification  Sole Source form  Resumes/Vitae of Key Personnel  Current and Pending Support of Key Personnel  Representations and Certifications  Negotiated Facilities and Administration Cost Agreement  Other requirements as determined by prime solicitation 7

8. AT PROPOSAL: TWO FORMS FILLED OUT BY PRINCIPAL INVESTIGATOR  Sole Source Justification Form  Sub Review Form 8

9. ALL FORMS NEEDED BY OCG TO PROCESS A SUB  Commitment Form  Sole Source Justification  Sub’s Proposal including:  Scope of work  Budget  Budget Justification  Sub Review Form  Negotiated Facilities and Administration Cost Rate Agreement  Animal/Human Subject certification/approval  Tax forms W9 or W8BEN if new sub  SPO Requisition / Marked Up SPO 9

10. SOLE SOURCE JUSTIFICATION FORM 10

11. 11 SOLE SOURCE JUSTIFICATION Only known acceptable source for research or services: No other type of service will suffice No other research approach will work with University’s project No other source can or will provide research or services within the scheduled deadlines Other sources were contacted and disqualified for specific reasons Unique technology, prior experience, expertise, professional stature or key personnel; Unique capabilities; Sponsor requests a specific subcontractor. Audit Focus: How was the selection made?

12. COMMITMENT FORM 12

13. COMMITMENT FORM  Sub completes this form - PI’s RESPONSIBILITY to have form completed by the Sub;  Provides Subcontractor’s contact information;  Identifies the documentation required to initiate the subcontracting process;  Identifies potential compliance issues;  Provides certifications 13

14. SUBCONTRACT / SUBAWARD REVIEW FORM 14

15. SUBCONTRACT / SUBAWARD REVIEW FORM  PI completes the Sub Review Form  PI reviews and approves the sub:  Statement of Work  Technical, staffing and management plan  Budget and Budget Justification  PI’s certification 15

16. SUBCONTRACT PROCESS  OCG sends subcontract notification email to PI and Department Administrator (DA) with a copy of the Subcontractor’s original proposal attached, requesting the Sub Review Form, SPO Requisition or marked up SPO and missing documents, if any  PI and DA will review proposal to determine if changes are needed  PI/DA provides final subcontract documentation to ocgsubs@colorado.edu ocgsubs@colorado.edu  If foreign entity, Visual Compliance is checked for export review and International Tax Review is completed 16

17. 17 Cost / Price Analysis is completed by OCG OCG Sub Administrator or Manager drafts subaward or subcontract agreement in accordance with the terms of the prime award or contract Sub Administrator sends agreement to subrecipient/subcontractor Negotiates terms as necessary Subrecipient/subcontractor signs and returns agreement to ocgsubs@colorado.eduocgsubs@colorado.edu SUBCONTRACT PROCESS, CONTINUED

18. OCG Director or Associate Director executes agreement OCG works within Marketplace to finalize purchase orders; Final PO and fully executed agreement emailed to PI and subrecipient/subcontractor PO authorizes sub to expend funds and invoice. 18

19. ADDITIONAL INFORMATION ABOUT SUBCONTRACTS  Separate project number established by OCG for sub;  Each Subrecipient or subcontractor is assigned a specific account code by SPA (new subs);  Each Subrecipient or subcontractor is assigned a vendor number by PSC (new subs);  UCB Facilities & Administrative Overhead (F&A) charged only on the first $25,000 of the subcontract;  Foreign subcontracts require a tax and export review;  Possible compliance issues: Animal/Human subjects, Export, Cost Share, Conflict of Interest 19

20. POSSIBLE DELAYS  Subs may require prior approval from sponsor;  Incomplete or erroneous materials received  Negotiation of sub terms (e.g., Troublesome Clauses)  President’s signature if > $5M  Required approvals from sponsor  Not receiving audit or cost/price forms back from sub  Not able to verify rates with cognizant audit agency  Tax forms not received from sub  Compliance issues  Small business subcontracting plan 20

21. FOREIGN SUBCONTRACTS  NASA  NASA funding may not be used to support research efforts by foreign entities at any level.  Direct purchase of supplies and/or services that do not constitute research from foreign sources is permitted.  NSF  NSF funding may be used to support research efforts by foreign entities if in the approved award.  Foreign sub’s indirect costs are not allowed unless the foreign entity has a previously negotiated rate agreement with a U.S. Federal agency that has a practice of negotiating rates with foreign organizations. 21

22. FOREIGN SUBCONTRACTS (CONT’D)  NIH  NIH funding may be used to support research efforts by foreign entities if in the approved award.  Full F&A costs will not be allowed. NIH provides limited F&A costs (8 percent of total direct costs less equipment) to foreign institutions and international organizations. 22

23. FISCAL RESPONSIBILITIES PI is responsible for managing the project; Sub submits invoices to PSC Accounts Payable (A/P) with a copy to Department; A/P enters expense into PSC financial system for payment; Department/PI compares budget to expenses with progress of the sub; Department/PI reviews cost sharing; Department/PI checks for appropriate certification of invoice; PI approves payment. REMEMBER, THE PI MANAGES SUB! 23

24. MONITORING SUB INVOICES The PI is responsible for the oversight of Subcontract/Subaward expenses PI To Ensure: Expenses follow contractual terms Sub’s work and spending support the University’s requirements of the prime award That means following subcontractor agreement terms  Also states -- When to invoice, what to include in invoice, cost share requirement, etc. Includes spending according to their proposed budget  Equipment?  Consultants? How do you know terms of subcontract agreement?  PI receives copy when fully executed  Part of subcontractor file 24

25. MONITORING SUB INVOICES (CONT’D) PI doesn’t need to do electronic approval but should initial an OK or send email with an OK  Administrators can help by reviewing before PI needs to OK SPA has tools to help Departments Monitor Sub Invoices and Spending that include: invoice template plus narrative support explaining how to use the Excel template as your tool guidelines for departmental/PI review of invoices to highlight the type of expenses to be particularly concerned about what type of expenses and/or budget changes to note when PI should be notified of particular circumstances

26. MONITORING SUB INVOICES (CONT’D)

27. Subrecipient Monitoring Guidelines for Departmental/PI Review of Invoices from Subrecipients The following checklist is a guide for reviewing subrecipient invoices. If you have questions regarding the accuracy and/or allowability of the expenses invoiced, ask the subrecipient for additional information and DO NOT APPROVE the invoice for payment until all items are resolved appropriately. Please contact your Sponsored Projects Accounting grant accountant for any assistance.

28. MONITORING SUB INVOICES (CONT’D) Tools found on ABS web site http://abs.colorado.edu/ Specifically: Click on “Forms” on left hand side of home page Then scroll down to Sponsored Projects Forms Subrecipient Invoice TemplateSubrecipient Invoice Template (Subrecipient Monitoring Guide)Subrecipient Monitoring Guide  invoice template is an Excel spreadsheet  narrative support to explain how to use the template as your tool  Parentheses have 2-page Word document  Need to click on each separately

29. SUB CLOSEOUTS Documents needed from PI/Department Administrator: (1) Closeout Certification Form PI certifies that the work was performed satisfactorily, the expenses were reasonable and that s/he has reviewed all invoices for - Allowability of Costs - Correct rates - Agreement compliance (2) Copy of Final Invoice - Marked “Final” by the Sub itself 29

30. SUB CLOSEOUTS Documents from Subcontractor/Subawardee Subcontractor Closeout Form and attachments: ◦ Final invention report ◦ Final property report ◦ A-133 certifications or other audit requirements ◦ Small business plan report (< $650,000) ◦ Subcontracting report ◦ Release of liability for University ◦ Assignments of refunds, rebates, credits and other amounts ◦ Confirmation that Final Technical Report was sent to PI 30

31. THANK YOU!!! 31