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Module C: Budget Basics. july12, 2011 Session 7 of AAPLS – Budgeting for proposals with subcontracts: establishing relationships Applicants & Administrators Preaward Luncheon Series. Overview of this Session. How to decide whether to budget for a vendor, a consultant or a subcontract? - PowerPoint PPT Presentation
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JULY12, 2011
SESSION 7 OF AAPLS – BUDGETING FOR PROPOSALS WITH
SUBCONTRACTS: ESTABLISHING RELATIONSHIPS
APPLICANTS & ADMINISTRATORS PREAWARD LUNCHEON SERIES
Module C: Budget Basics
Overview of this Session
How to decide whether to budget for a vendor, a consultant or a subcontract?
- Self assessment quiz
Subcontract documents for proposalsBudget calculations with subcontracts
Subcontract agreements
Vendor, Consultant of Subcontract?
The nature of the collaborative relationship determines the type of the agreement
For Vendor and Consultant agreements Tufts uses the template “Contract for Goods and Services”. These are processed by Purchasing
Subcontract agreements are prepared by ORA using several templates that are customized for each agreement
Vendor (Purchasing Relationship)
Provides similar goods and services to many different purchasers
Provides services within its normal business operations
Operates in a competitive environmentProvides goods and services that are ancillary
to the grant programHas its performance measured against the
deliverablesResults produced by the vendor belong to
Tufts
Consultant (Collaboration with an Individual)
Provides professional advice or servicesNormally not an employee of the engaging partyIn unusual situations, an individual may be both a
consultant and an employee of the same party, receiving compensation for some services as a consultant and for other work as a salaried employee
Consultant agreement is typically with an individual not with the institution that employs him or her
Results produced by the consultant belong to Tufts
Sub-recipient (Subcontract Relationship)
Carries out a program rather than provides goods and services; has responsibility for making programmatic decisions
Has its performance measured against whether objectives of the program are met
Has responsibility for adherence to compliance requirements
May collaborate with Tufts to publish results of the research
Results developed by the sub-recipient are owned by the subcontract institution
Subcontracts are with institutions not with individuals
Subcontract Documents for Proposals
For proposals with subcontracts, Tufts should request from each collaborating institution a budget with budget justification and all the documents required by the sponsor agency
If Tufts is a subcontractor, we must provide all necessary documents to the prime institution at the time of application submission
Internal coordination form and financial disclosure(s) are routed at the time of the application
Refer to the Subcontract Checklist for documents needed for submissions to NIH & Other PHS agencies
Budget Calculations with Subcontracts
Both direct and indirect cost of the subcontract become part of total direct cost budget for Tufts
NIH excludes indirect costs of the subcontracts from total direct cost budget cap
NIH limits indirect cost budget of foreign institutions to 8% of their total budget less equipment
Budget Calculations with Subcontracts (cont)
Base for F&A (overhead,) is the amount multiplied by F&A rate
Base can be MTDC (modified total direct costs) or TDC (total direct costs)
For federal awards use MTDC as base for F&AFor federal budgets with subcontracts this means
that the amount of each subcontract in excess of $25,000 is excluded from overhead cost calculations
For non-federal awards use TDC as base for calculating F&A unless sponsor agency specifically requires excluding certain budget categories (for example, Gates Foundation)
Subcontract Agreements
Must be executed when award is issued to the prime awardee
Subcontract agreements are drafted, negotiated, signed and processed by ORA
Subcontracts are normally issued as cost reimbursable agreements. Justification for deviation from the standard business practice is required. Allow additional time for drafting of subcontracts if customized payment terms are required.
More on Subcontract Agreements
ORA flags awards with subcontracts for processing of the subcontract agreements and amendments
An email from the PI to ORA about the need to issue a subcontract or an amendment for another budget year will expedite the process
The PI should verify that budgets for any subcontracts included with the application are still accurate at the time of the award
Internal rebudgeting is necessary if the subcontract amount must be different from the amount awarded for the subcontract by the agency
Agency approval may be required to modify subcontract amounts. This approval is requested by ORA
Information Needed by ORA to Issue a Subcontract
Award numberInternal account number (received from
Sponsored Accounting via INOA)Start and end dates of the subcontractName and full contact information of the
other party’s Institutional OfficialSubcontract PI name and full contact
informationSubcontract budgetSubcontract scope of work
Conclusions
Subcontract arrangements formalize collaborative relationships between Tufts University and partner institutions to implement research and technical assistance projects
Intent to enter into a subcontract should be documented at the time of the proposal
After the award is made to Tufts, ORA will issue subcontracts for the project
Tufts has responsibility to monitor performance under the subcontracts
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