The Graduate School

Outgoing Subawards

What is a Subaward?

Uniform Guidance defines a subaward accordingly, “an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a Federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a Federal program. A subaward may be provided through any form of legal agreement, including an agreement that the pass-through entity considers a contract.”  In this context, the “pass-through entity” is Montclair State University and the “subrecipient” is another institution or organization, for example, another university.  Subawards can be part of a federal, state or private award.  The “legal agreement” is typically called a subaward agreement which includes the subrecipient’s scope of work, budget and flows-down the required terms/conditions of the award to MSU, e.g. reporting requirements, prior approvals, etc.

What is the subaward process?

When MSU is providing a subaward to an institution, Uniform Guidance requires a risk assessment take place.  The Office of Sponsored Programs will first conduct a risk assessment to determine the level of risk involved with entering into a subaward agreement with a subrecipient.  For example, OSP will determine if the subrecipient has any prior Single Audit findings.  As the prime awardee, MSU is responsible for the subrecipient’s subaward actions.  Once the risk assessment is completed, OSP will draft the subaward agreement and provide it to the subrecipient for review, and/or partial execution.  If there are terms that the subrecipient would like to negotiate, OSP will do so.  Once a subaward agreement is fully executed, OSP will inform the Office of Grant Accounting.  The Office of Grant Accounting will fully encumber the subaward amount in Workday.  During the life of the subawared agreement, the PI will receive invoices from the subrecipient, typically quarterly, for their review.  If the PI approves the invoice, he/she will send it to his/her assigned Grant Accountant for further review and payment.  If the PI does not approve the invoice, he/she should discuss with his/her Co-PI at the subrecipient institution.

For more information, please contact Catherine Bruno at or Ext. 6923.