About Contracts and Grants
Management Basics
Receiving grant funding means managing grant funding. Effective grants management is essential, it encompasses the management of policies, procedures and processes pertinent to the administration of a sponsored program. The grant process follows a lifecycle that includes the entire process of a grant—from planning, to opportunity, to implementation, to closeout.
The specific actions along the lifecycle are grouped into three main phases:
| AWARD LIFE CYCLE | ||
|---|---|---|
| PRE-AWARD | AWARD | POST-AWARD |
| Project Development | Award Acceptance | Award Set Up |
| Identify Funding | Award Management | |
| Proposal Preparation | Award Closeout | |
| Proposal Submission | ||
Sponsored Project Office - Pre-Award and Award Phase - The role of the Sponsored Projects Office (SPO) / Pre-Award is reviewing, approving, negotiating, and advising Principal Investigators, Faculty & Staff members who seek external funding from federal, state, local, and business entities. SPO processes No-cost extension requests, early termination requests, amendments, supplements, non-monetary prior approval requests, and all communications with the sponsor on behalf of the UNM. Please reach out to your Sponsored Project Officers for any of your Pre-Award needs.
Contract and Grant Accounting Office - Post Award –Post-award administration is the term used for all grants management activities after an award is received. The post award phase comprises a significant amount of work over the duration of the award dates. Administrative responsibilities include but are not limited to, award and account set up, managing modification changes, financial compliance, monitoring expenses, billing and invoicing, accounts receivable review, financial reporting, and completing the closeout requirements. Please reach out to your Fiscal Monitor for any of your Post Award needs.
Regulatory Environment
To ensure effectiveness and efficiency of operations, as well as proper stewardship of federal funding, various regulatory environments are reviewed in order to provide reasonable assurance that awards are being managed in compliance with Federal statutes, State statues, regulations, and the terms and conditions of the award have been met.
- Institutional Policies
- Award Terms and Conditions
- Sponsor Terms and Conditions
- Uniform Guidance & FAR's
Distinguishing where the funding is coming from and what type of award you are managing
Contracts, grants, and cooperative agreements are the three most commonly used instruments through which the University accepts sponsored funding. Sponsored projects can be funded through a wide variety of sources. Understanding the type if award is crucial to your compliance and management efforts. It’s important to understand the differences between various award types.
| Grants | Contracts | Cooperative Agreement | |
|---|---|---|---|
| Basic Purpose | A flexible instrument designed to provide funding assistance to support a public purpose. Project Aims Fulfillment | A legally binding agreement between a buyer and a seller to provide goods or services in return for consideration (usually monetary). Procures goods or services. | A flexible instrument designed to provide money to support a public purpose. Designed to establish a relationship between parties. |
| Terms & Conditions | Governed by the terms of the grant agreement. | Governed by Federal Acquisition Regulations (FAR) | Governed by the terms of the cooperative agreement. |
| Scope | Flexible in defining scope of work, budget and changes, and outcomes. Conceived by PI. | Very specific in defining scope of work and outcomes. Conceived by sponsor. Relatively inflexible as to the budget, and other changes | Flexible in defining scope of work, budget and changes, and outcomes Conceived by PI. |
| Effort | Diligent efforts are used in completing research and the delivery of results | Significant emphasis placed on delivery of results, product, or performance | Diligent efforts are used in completing research and the delivery of results |
| Sponsor Involvement | Incorporates the sponsor's guidelines but allows the awardee significant flexibility in carrying out the project with little to no oversight from the sponsor. | Monitors activity and progress, expects results | Substantial agency involvement |
| Payment | Payment awarded usually in annual lump sum or a “drawdown” system | Payment based on deliverables and milestones | Payment awarded in annual lump sum unless otherwise specified in the cooperative agreement |
| Rebudgeting | Flexible within sponsor defined restrictions | More restrictive, generally requires pre-approval from the sponsor | Flexible within sponsor defined restrictions |
| Reporting | More flexibility in use of funds and reporting requirements are generally annual reporting requirements | More fiscal requirements – frequent reporting as outlined in the terms of the contract. Failure to perform can results in possible legal action and fiscal consequences. | Reporting requirements determined by the cooperative agreement |
| Flexibility | Principal Investigator has more freedom to adapt the project and the grant is flexible to change in scope of work, budget and other project features. | High level of responsibility to the sponsor for the conduct of the project and production of results. Not flexible and must adhere to stated scope of work, budget, etc. | Substantial involvement is expected between the executive agency and the State, local government, or other recipient when carrying out the activity contemplated in the agreement. |
| Final Deliverables | Technical, Programmatic & Financial Reporting | Technical, Programmatic & Financial Reporting | Deliverable as per agreement |
Why is Grant Compliance So Important?
The process of ensuring your grant money is properly used and reported to the government is called grant compliance. Each type of program has its own standards, including rules and regulations that cover the handling of documentation, data reporting, impact, and progress. Whether or not you can meet the grant compliance requirements impact your ability to obtain funding in the future.
Successful grant compliance involves the practice of:
- Understanding the award requirements based on the type of award
- Understanding the activities allowed or unallowed
- Understanding the allowable costs based on cost principles
- Understanding the billing terms
- Understanding the reporting requirements
Cost Principles
- Reasonable - Goods or services acquired and amount involved reflect an action a prudent person would have taken.
- Allocable - Benefits the project or award that was charged.
- Allowable - Items not restricted by federal regulations or specific grant/contract terms.
- Treated Consistently - like costs are treated in the same manner under like circumstances
Unallowable Expenses can be considered either activities or transactions due to regulations by the federal government or the sponsor. Unallowable costs may also be identified in the specific terms and conditions of the award.
Reach out to your contract and grants fiscal monitor with any post award question regarding interpretation of policies, allowability of costs, or any questions related to compliance on grants management.
