Subpart-A, General

(Original document: OMB Circular A-133 - Audits of State, Local Governments and Non-Profit Organizations)

Differentiation between Sub-recipient and Vendor:

§ 105 Definitions

• Sub-recipients means a non-Federal entity that expends Federal awards received from a pass-through entity to carry out a Federal program, but does not include an individual that is a beneficiary of such a program.

Vendor means a dealer, distributor, merchant, or other seller providing goods or services that are required for the conduct of a Federal program.  These goods or services may be for an organizations own use or for the use of beneficiaries of the Federal program.

§210 –Sub-recipient and vendor determinations

• General: An auditee may be a recipient, a sub-recipient, and a vendor. Federal awards expended as a recipient or a sub-recipient would be subject to audit under this part. The payments received for goods or services provided as a vendor would not be considered Federal awards. The guidance in paragraphs (b) and (c) of this section should be considered in determining whether payments constitute a Federal award or a payment for goods and services.

Federal award

Characteristics indicative of a Federal award received by a sub-recipient are when the organization: 

• Determines who is eligible to receive what Federal assistance;
• Has its performance measured against whether the objectives of the Federal program are met;
• Has responsibility for programmatic decision making;
• Has responsibility for adherence to applicable Federal program compliance requirements;
• Uses Federal funds to carry out a program of the organization as compared to providing goods or services for a program of the pass-through entity;
• Payment for goods and services. Characteristics indicative of a payment for goods and services received by a vendor are when the organization;

•  Provides the goods and services within normal business operations;
•  Provides similar goods or services to many different purchasers;
• Operates in a competitive environment;
• Provides goods or services that are ancillary to the operations of the Federal program; and
• Is not subject to compliance requirements of the Federal program.

---

*   Extracted from OMB Circular A-133 issued on June 24, 1997