Hi Ann,

Even if your auditors never come around to your way of thinking, your
Purchasing Department would have some sort of "sole sourcing" policy
that would apply here, especially since the primary award pretty much
*requires* you to "subcontract" the "work" to the institution(s) named
as partners in the proposal.  I'm surprised the auditors don't
understand this.

Lesley

Lesley K. Cephas, Contract Officer
Business Research Partnerships
Sponsored Research
University of California, Los Angeles
xxxxxx@ucla.edu

 -----Original Message-----
 From:   Ann Lessem [SMTP:xxxxxx@TEEXNET.TAMU.EDU]
 Sent:   Thursday, October 08, 1998 8:10 AM
 To:     xxxxxx@HRINET.ORG
 Subject:        Auditing of Collaborative Projects

 We are having a problem with auditors on our
collaborative projects.
 The auditors do not see a difference between projects
that are
 developed collaboratively by several institutions
(working as partners)
 and projects developed by one institution with the
intent to subcontract
 once funds are awarded.

 We have explained to them that collaborative projects
involve partners
 who have worked together to develop the statement of
work but the
 sponsor requires one partner to serve as fiscal agent.
Therefore, funds
 for the partners must be disbursed through a
subcontract.  However,
 the auditors insist that a subcontract is a subcontract
is a subcontract,
 and that we must receive bids before we make an award.

 We, obviously, have no desire to go back to a partner
and tell them we
 got the funding, but they now have to re-compete in
order to receive
 their share.  We have included names of the partners in
the contract
 with the sponsor and have even gotten letters from the
sponsor
 acknowledging that a partner is part of the project, all
to no avail.

 How do some of you handle this situation?

 Ann Lessem, Ph.D.
 Program Manager
 The Proposal Office
 Texas Engineering Extension Service
 Texas A&M University System