Subawards and Subrecipients

Say you win a federal grant, and part of the work belongs to another organization — a smaller partner that runs a piece of the program on the ground. When you pass grant money to them to do that work, that money is a subaward, and the partner is a subrecipient.

Under federal Uniform Guidance (2 CFR 200.331–332), you — the pass-through entity — are on the hook for more than writing the check. You have to size up the partner before the award, keep an eye on them during it, and be able to show an auditor you did both. NP Ledger gives you one place to hold all of that: the agreement, the risk assessment, the monitoring log, and the spending, per subrecipient.

This is a record-keeping tool, not a compliance ruling. Think of it as the folder your auditor wishes every grantee kept — filled in as you go, instead of scrambled together the week before fieldwork.

If your organization spends federal money, a Single Audit can look straight at your subawards. The auditor wants to see that you made a real subrecipient determination, assessed risk before the money moved, and monitored the partner while the work happened. Missing any of that can turn into questioned costs — money you may have to give back.

The other reason is simpler: a subrecipient is not a vendor. A vendor sells you a good or service on the open market. A subrecipient carries out part of your program under your federal award. Treating one like the other is the mistake 2 CFR 200.331 exists to prevent, and it changes what rules apply.

Before you set anything up, make the call: is this partner a subrecipient or a contractor? The distinction drives everything downstream. 2 CFR 200.331 lays out the test — here's the plain-language version.

No single line settles it — weigh the whole picture and use judgment. If the partner is really a contractor, they belong in your normal vendor and 1099 flow, not here. If you're unsure, that's a good question for your CPA or grant compliance officer.

A subaward lives under the grant that funds it. You'll find it from the grant's detail page, on the Subawards card.

Each subaward record holds:

• The agreement — subrecipient, agreement number, period of performance, award amount, and type (cost-reimbursement or fixed-amount).
• A risk assessment — the pre-award 2 CFR 200.332(b) checklist. See Subrecipient Risk Assessment.
• A monitoring log — your check-ins during the period. See Subaward Monitoring.
• Agreement documents — the signed agreement and any amendments.
• Budget and spending — a per-subaward budget (optional) and everything you've tagged as spent against it.

A subaward starts as a draft. Before you can move it to active, NP Ledger asks for two things: a risk assessment on file and a signed agreement uploaded. That's not busywork — it's the order Uniform Guidance expects, so the tool nudges you to do it in that order.

Recording what a subrecipient spent is the part that makes everything else work. When you record an expense against a grant that has active subawards, a Subaward dropdown appears on the line. Pick the subrecipient, and that expense flows to their spending view.

You can tag expenses this way from every entry path — Quick Entry, Manual Entry, Bills, Voice Entry, and Spreadsheet Import. Leave the dropdown blank for direct program costs that you didn't pass through. Only the expense line carries the tag, and only expenses count toward pass-through totals, so a refund or void nets back out automatically.

One thing to watch: the dropdown lists the grant's active subawards. If you pick a subrecipient whose subaward belongs to a different grant than the expense line, the tag is dropped rather than mis-filed — no harm, but the expense stays untagged, so double-check the pick if it doesn't show up later.

Once you're tracking a few subawards, the Subaward Compliance report (under Compliance & Analysis) rolls them all up: award, spent, remaining, risk level, last monitoring date, and a traffic-light status for each. Green means on track; yellow means something needs attention soon; red means act now. Filter by grant, risk, or monitoring status, and export to CSV or PDF for your board packet or your auditor.

The traffic light is computed from your data — it's a prompt to look, not a verdict. What counts as "current" monitoring depends on the risk level you set, which is exactly why the risk assessment comes first.

• Subrecipient Risk Assessment — the pre-award checklist, step by step
• Subaward Monitoring — what to check during the period, and how often
• Foundation vs. Government Grants — which grant rules apply to your funder