Background
When the University of Miami (UM) issues a subaward to another entity, the federal sponsor expects UM to take on the role and responsibilities of the government by engaging in evaluation and monitoring activities. These requirements are codified under 2 CFR 200.332. Even though UM enters into an agreement with the subawardee detailing the terms and conditions of the funding, UM can be held responsible for the acts of the subawardee that violate federal requirements if UM does not appropriately monitor and manage the subawardee.
Even beyond the federal requirements, monitoring is an essential activity, critical for identifying issues and problems so they can proactively be resolved. The consequences of not taking these actions can result in legal proceedings, loss of funding and delays and other negative impacts to the project.
Evaluation and Monitoring
Prior to issuing a federal subaward, UM gathers information from the subawardee and completes a thorough review to “evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions”[1]. UM will review prior audits, experience with federal funding and our own experience in working with the subawardee among others. If a subawardee has one or more risk factors, UM may require additional monitoring activities such as requiring invoices with documentation to back up the expenses so UM can ensure the subawardee is following all federal regulations.
Being identified as higher risk requiring additional monitoring is not a bad thing! While it does add some additional work for the subawardee and UM, our goal is to help them to be successful. If they continue to get federal funding, this will reduce their likelihood negative consequences as the result of audit. We want to work with the subawardee collaboratively to solve issues.
Monitoring is always required, even when a subawardee is identified as low risk. The Principal Investigator (PI) at UM must monitor the subawardee to ensure they are completing their responsibilities in accordance with the scope of work. Additionally, the PI must review invoices to confirm the work aligns with the payment requested and that the costs appear reasonable.
Identifying and Resolving Issues
The UM PI must immediately inform Research Administration about concerns, issues and any change that impacts the funding or scope of work. For example, if the scope of work for the subawardee (and corresponding total award amount) is reduced, Research Administration will issue an amendment to the agreement with the subawardee. This critical action protects the project and significantly reduces the likelihood of a dispute. Additionally, the PI should never approve an invoice if there are issues or concerns. Reach out to Research Administration, we are here to help.
In response to issues raised by the PI or identified through monitoring, Research Administration may also impose additional monitoring activities or amend the agreement to add terms and conditions.
Conclusion
As the recipient of the federal funds, UM is require to ensure those funds are handled in accordance with all terms and conditions and relevant regulations and policies. Effective monitoring practices of subawardees is not only required but can help our subawardees be better stewards of federal funds.
Resources
UM Subrecipient Monitoring Policy
Uniform Guidance Regulations (2 CFR 200.332 Requirements for pass-through entities)
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12CFR 200.318(b)
Please join me on May 18th at 12:00 p.m. to discuss this topic further, I would love to hear from you!
Register in advance for the Zoom session here. You may also submit your question(s) and/or comment(s) in advance of the session.
