What Is the Difference between a Subaward and a Subcontractor

When the SBU is funded by a sponsor (also known as the main sponsor) and passes on some of the work to another institution, it is called an outbound sub-prize. If your award involves sub-recipients (sub-recipients or subcontractors), you must submit an RF purchase request to the PSO contracts. PSO requires a copy of the sub-recipient commitment form, service description and sub-recipient`s budget (if not already submitted with your myResearch application) to develop a sub-beneficiary agreement (a subcontract or subcontract). Note 2: This document explains the distinction between the sub-recipient agreement and the supplier agreement. There is a separate consultation policy on the PSO website. In addition, model consulting contracts are available on the OGC website. A common mistake we usually see is when non-profit organizations complete their FESA and ask the grantor whether the funds are federal or non-federal. The grantor may respond that its funds are federal, and then provide the CFDA number and the amount funded by the federal government. However, this does not automatically mean that the nonprofit`s funds should be considered federal. The key question you should ask the transmitting entity is whether your agreement will be considered a sub-label with federal compliance requirements or a supplier agreement. A sub-prize is an agreement with a third-party organization that conducts part of a funded research project or program. The terms of the relationship (sub-grant/subcontract) are affected by the main agreement, and all subcontracts must be monitored to ensure that the sub-recipient complies with these conditions. A sub-recipient will work with the Grand Prize winner to complete the proposed scope of work.

Following the awarding of a prize, sub-recipients must comply with the downstream conditions associated with the main prize, including all federal regulations and compliance requirements for federal funding sources. Actual application: In this context, a subprice refers to the actual contractual agreement between the beneficiary and the sub-beneficiary and not to the name that refers to the party receiving the contract. If a not-for-profit organization receives a grant or contract from a donor (not-for-profit or government), these funds may be considered federal funding. The not-for-profit organization must understand whether the federal funds are the result of a „subcontracting“ or whether the payments received from the grantor are the result of a subcontractor/supplier relationship. The wording of the grant or contract can be confusing and lead to errors in the federal premium expenditure system (EEZ). Once you have determined whether the funds should be classified as subcontracting or purchasing from suppliers, the activity must be properly classified in the budget of your proposal. The sub-award process is used when the UAF transfers a portion of the sponsored award to another entity for programmatic efforts around the project. All terms and conditions that are part of the main assignment must be included in the subcontracting document. Acceptance of these Terms by an authorized signatory of the receiving company is required. The company receiving the funds is a sub-recipient.

Sub-prize – A legal instrument issued to a subordinate employee as part of a federal financial aid award. The recipient of a sub-award is called a sub-recipient. Before entering into a relationship with another entity under a sponsored award in which the other entity provides goods or services or material programmatic work to Harvard as the primary recipient of the funding, a provision must be made as to the nature of the legal relationship between Harvard and another entity, which in turn determines the nature of the legal agreement, which is necessary to document the relationship. This is an important decision as it determines the division of responsibilities and affects the appropriate application of indirect cost rates. In the case of a sub-agreement, it is the responsibility of the Principal Recipient (Harvard) to ensure that the Sub-Recipients carry out their portions of the research projects in accordance with all applicable procurement and subcontracting conditions and that the project costs incurred by the Sub-Recipients are reasonable and eligible. However, agreements with contractors (suppliers) for the purchase of services generally do not bind suppliers to the full terms of the proponent and are subject to competitive procurement practices to ensure that funds paid to sellers do not exceed fair market value. In the case of a sub-prize, it is USC`s responsibility to ensure that a sub-recipient performs its portion of the programmatic work in accordance with all applicable terms of the sponsored prize and that the project costs incurred by a sub-recipient are reasonable and eligible. Subcontracting is likely to be appropriate in the following circumstances: an FESA with errors (including confusion between the terms sub-beneficiary and subcontractor) could result in an insufficient compliance audit, the possibility of a new audit presentation and additional audit costs. The regulations applicable to federal grants (grants, cooperation agreements and „others“) should not be confused with contracts that the university receives from the federal government.

A contract is defined, issued, managed and executed in accordance with Title 48 of the CFR, Federal Acquisition Regulations (FAR). The FAR apply only to procurement activities and do not distinguish between subcontracting and procurement. A procurement that takes place under a federal contract is a subcontract. There is NO subcontracting under federal contracts. I recently spoke to a client who received two federal grants from two different federal organizations. They began working on contractor contracts for their suppliers and found that each agency interpreted the sub-price terminology of the sub-price of the 2 CFR 200 (Uniform Grant Guidance or UGG) sub-price very differently compared to the subcontractor. Determining the appropriate relationship at the tender stage is essential to ensure that costs and compliance requirements are properly considered. Misclassification can lead to delays in processing subcontracting, inaccurate cost calculation (e.B. Non-inclusion or exclusion of Q&A costs) and lead to a delay in seeking approval of project changes. Sub-receiver – Sub-receiver means a non-federal entity that receives a sub-designation from a flow-through entity to deliver part of a federal program; does not, however, include a person who is a beneficiary of such a program. A sub-recipient may also be a recipient of other federal awards directly from a federal awarding body (Uniform Guidance § 200.93) Incoming sub-prizes occur when another institution (intermediary entity) is funded by a sponsor (also known as the lead sponsor) and that institution transfers some of the work to the SBU. OMB Circular A-133, the federal government`s guidelines on this subject, groups sub-recipients with recipients with recipients.

Like recipients, sub-recipients measure performance against program objectives, meet procurement requirements, use funds to carry out program activities, and make programmatic decisions. Cooperation partners often receive sub-awards to conduct fundraising activities for the applicant. Subcontracting or subcontracting? What`s the difference and why should you – the granter, the grant winner, the grant manager – care? Most of the work on the prizes sponsored at Harvard is done by faculty and staff on the university premises. However, it is sometimes stipulated that part of the research or project must be conducted by a single consultant (see note 1) or a single entity (see note 2) or outside the university. In these cases, a legal agreement is required that describes the relationship between the parties and the university and can take the form of a subcontract (usually in the form of a subcontract/subcontractor) or an agreement with a contractor (seller) on the purchase of services. It is important that the correct determination of the agreement is made early in the process of preparing a grant application, as the overhead processing and follow-up requirements for this type of agreement vary and affect the grant budget and, in some cases, the narrative of the grant. .