Federal Grants for Horses by mdq72040

VIEWS: 6 PAGES: 177

Federal Grants for Horses document sample

More Info
									 Monitoring Grants and
Cooperative Agreements
        (PY222)


 Office of the Procurement Executive (A/OPE)
              Mr. Corey M. Rindner




           November 14, 2010
           A/OPE/FA Staff
   Georgia K. Hubert, Director, Federal
    Assistance, hubertgk@state.gov, 703-812-
    2526

   Kimberly S. Butler, Grants Policy Analyst,
    butlerKS2@state.gov, 703-516-1754

   Phyllis A. Swann, Grants Policy Analyst,
    swannpa@state.gov, 703-516-1691
           A/OPE/FA Staff
   Joanna Snearly, Grants Policy Analyst
    snearlyjp@state.gov, 703-516-1989

   Anita Exum, Grants Policy Analyst
    ExumAE@state.gov, 703-875-5119

   Gregory M. Young, Grants Management
    Specialist, younggm@state.gov, 703-516-
    1988
             A/OPE/FA Staff

   Steve Galiotto, Grants Management Specialist,
    GaliottoSJ@state.gov, 703-875-7499

   Barbara Fox, Grants Management Specialist,
    FoxBT@state.gov, 703-875-7169

   Jennifer King, Grants Management Specialist,
    KingJS@state.gov, 703-516-1886
            Goals and Objectives
   Develop a monitoring plan.
   Evaluate hypothetical grant scenarios to
    determine whether prior approval is required.
   Identify weaknesses in recipient internal controls
    through a mock-site visit.
   Determine appropriate special conditions for
    high-risk recipients.
   Analyze scenarios illustrating recipient waste,
    fraud and abuse in federal programs and
    determine appropriate measures to pursue.
   Proactive negotiating resolution of problems that
    arise during grant performance.
           Module 1


Introduction and Course Overview
  What is effective grants
     management?

Effective grants management is a
process (or result) of adequate
overall oversight and monitoring of
federal assistance awards that
includes project resources,
activities, and results.
          What are the purposes of
       effective grants management?



   Accountability

   Program goals accomplished

   Agency performance goals
    When does it begin?


Effective grants management
begins before the award is signed!
Which type are you?
    Specific Purposes of Monitoring

   Confirm compliance of award terms
    and conditions
   Determine the extent to which the
    proposal matches activities
   Detect early warning signs of
    trouble and non-compliance and act
    accordingly
        Basic Process of Monitoring


   Collect and review data

   Analyze

   Take action
                Formal or Informal



   Monitoring can be formal or informal

   Factors that determine monitoring
    level
       Experience – grantee and grants officer
       Dollar amount
       Program visibility or complexity
                EXERCISE
    Government-wide concerns in monitoring

 Turn to Tab 1 in Reference materials
 Each table find five issues on monitoring
  about each agency
(DOJ/OIG, NSF, EPA, DOJ/GAO, OIG/EPA)
 Report to group
    Government Wide Concerns in
       Grant Management

   Lack of monitoring
   No site visits
   Lack of progress reports
   Reports not reviewed
   Lack of expertise
   Understaffed
    Government Wide Concerns in
     Grant Management (continued)

   Questionable costs
   Lack of proper procurement
   Prospective grantees not being
    treated fairly
   Results not being measured
   Lack of closeout
           Module 2


Objectives and Performance
Measures
         Performance Measures

   Process of regularly measuring the
    outputs and outcomes produced by
    the program

       Inputs – dedicated resources for
        outputs
       Outputs – activities
       Outcomes – changes that occur
       Performance Measures

   An attempt to assess the impact
    and value of programs

   To demonstrate program
    accountability

   To address the question of “What
    are programs trying to accomplish?”
              Techniques

   Evaluations
   Data collection
   Analysis of data
   Questionnaires
   Reports
    Why Conduct Performance
         Measurement?

   Spends limited resources on most
    effective programs
   Clarifies program purpose
   Documents program results
   Improves program performance
       Identifies successes
       Identifies areas for improvements
      Why Measure and Evaluate?

   To justify the existence (or budget) of the
    program and how it contributes to the
    organization’s goals and objectives
   To understand how the program is working
   To make real improvements to the program
   To drive program and policy outcomes
   To fulfill legislative requirements
   To keep federally funded programs
    accountable to the American taxpayer
           Government Context
   The Government Performance and
    Results Act of 1993

   The President’s Management Agenda

   The Office of Management and Budget
    (OMB)’s Program Assessment Rating Tool
    (PART)
        Government Performance and
            Results Act (GPRA)

   What does it do?             What is the
       Requires agency           process?
        strategic plans,             Identify outcomes
        performance plans,           Identify programs to
        program                       achieve outcome
        performance reports          Assess program
                                      performance
    Program Assessment Rating
           Tool (PART)
   Formal system to rate effectiveness of
    federal programs
   Series of questions designed to provide
    consistent approach to rate all programs
    on performance
   Four Sections:
       Program Purpose and Design
       Strategic Planning
       Program Management
       Program Results
      Purpose of PART


PART presents an opportunity to
inform and improve agency GPRA
plans and reports, and establish a
meaningful systematic link between
GPRA and the budget process.
        Definition of Results

   Significant, intended, measurable
    change in the condition or change in
    recipient country or institutions

   Results oriented assistance
    instrument – achieves results that
    contribute to the performance goals
               EXERCISE

        Designing Program Results
   Exercise is in Tab 22 “PART
    Questions”
   Use Sample PART in Tab 2 as guide
   Table Groups – develop a program
    that answers the questions listed in
    the exercise – 20 minutes
   Discuss as class
     Planning Results Oriented
            Assistance
   Develop a vision
       MSP
       BSP
       OP – for foreign assistance funds

   Develop measurement system

   Determine how to achieve specific
    programs
                Consideration

   What lends itself to being measured?

   What are are the resources needed to
    achieve program results?

   Political, economic, geographic factors
       Specific Assistance Programs

   Define the problem
   Results oriented program description –
    express as tangible, measurable
    objective against which actual
    achievement can be compared
   Establish system for monitoring and
    evaluating performance and reporting
                   Tribal Wisdom Vs.
                 Government Approach
1.    Buying a stronger whip.
2.    Asserting “This is the way we always have ridden this horse.”
3.    Arranging to visit other sites to benchmark how they ride dead horses.
4.    Providing additional training to increase riding ability.
5.    Outsourcing to private contractors to see if they can ride the dead horse
      cheaper.
6.    Harnessing several dead horses together to increase the speed.
7.    Declaring that, as the dead horse does not have to be fed, it is less costly,
      carries lower overheads, and therefore contributes substantially more to
      the bottom line of the economy than do some other horses.
8.    Commissioning a study to identify ways to improve dead horses through
      incremental enhancements, such as adding wheels.
9.    Rewriting the expected performance requirements for all horses.
10.   Promoting the dead horse to a supervisory position.
        Imperative to Measure
   All programs can be measured in some way
   Outcomes and results mean “change”
   Build upon the successful measurement you
    are already doing
   Plan evaluation when you are planning
    programs
   Measure in your sphere of influence
   Quantitative data (numbers) about results is
    important to stakeholders
   There are no perfect measures or
    evaluations
   Value from measures comes from how they
    are used, not in the measure itself
                      Definitions
   Input
       Resources required to operate a program
   Output
       A measure of the number of units produced,
        goods and services provided, or people served
        by an agency or program.

       Examples include:
               Number of youth exchange participants or visitors
                to American Corners
               Number of post-written op-eds placed
               Number of unique website users, page views
                Definitions continued
   Outcome
       The participation or absorption of an output
   Result
     An intended, measurable change from the starting
      point
    Examples include:
            Change in knowledge or skills (e.g. better
             understanding of the U.S., more favorable impression of
             the U.S.)
            Change in behavior or condition of the participant
            Change in an institution, community or society (new
             legislation, changed curricula, more favorable editorials,
             etc.)
                   Levels of Outcomes

                  What were the results?
           rs e
          hold




                                           Ea
                      Did they use it?




                                              sy
      take




                                              to c
  to S




                     Did they learn?




                                                  olle
    e




                                                      ct
Valu




                     Did they like it?
              Definitions continued
   Impact
       The cumulative or net effect of the
        outcomes or results.

       Examples include:
          Better relations between the United States
           and other countries
          Increased level of education of youth in
           developing countries
                     Use A Logic Model

    Your planned work                                 Your intended results


Inputs        Activities           Outputs                  Outcomes               Results
                                                                                   or
•Funding     •Websites           •# of web readers         •Target audience        Impact
•Staff       •Outreach           •# of articles            more aware
                                 •# of audience            •Target audience
•Equipment   •Media placements                                                    •Better
                                 members                   with increased
             •Exchanges                                    knowledge              relations
                                 •# of media
             •Partnership                                  •Media runs more       •International
                                 placements
             development                                   balanced or positive   support
                                 •# of exchange            stories about U.S.     •Cooperation
                                 participants
                                                           •Local institution
                                 •# of institutions        develops American
                                 reached                   Studies program
              Performance Metrics
                      Can you measure and track

  Your planned work                      Your intended results


Inputs      Activities        Outputs           Outcomes         Impact




                            Time Frame
         Aligning Outputs to Outcome Goals and
                       Measures


Outputs      Outcomes                   Results                     Impact
35,000      •Participant satisfaction                             International
                                        •More accurate and        exchanges
            •Increased aptitude         balanced understanding
Exchange                                                          increase mutual
Visitors    •Increased                  of U.S. or host country   understanding
            understanding               •Sustainable              and build trust
                                                                  between
            •Increased trust            partnerships between
                                        U.S. and host country     Americans and
            •Increased leadership       institutions and people   people and
                                                                  institutions
            •Concrete actions           •Individuals or           around the world
            •Increased explanation      institutions effect
                                        positive change in
            •Increased                  society
            collaboration
          What to Evaluate/Report
                Recommendations
   Individual Results       Institutional Results
      Change in                Change in

         Knowledge                Procedures

         Understanding            Programs

         Attitudes,               Policies
          Perceptions              Partnerships
         Behavior

         Condition,
          Status,
          Direction
                Linking Goals and Performance
                         Measurement
                                 More secure, democratic, and prosperous
            DoS Mission          world for the benefit of the American
JSP                              people and the international community
          Strategic Objective    Promote international understanding
                                  Increase understanding for American
BSP         Strategic Goal        values, policies and initiatives to
                                  create a receptive int’l environment

         Performance Goal         Exchanges increase mutual
                                  understanding and build trust
PART                               Exchanges in NEA and SA
       Initiative/Program/PART
                                  % participants who improve their
       Performance Indicator      understanding of the U.S.
MSP
             Last Thoughts
   For qualitative measures, choose
    process steps
   Limit to critical 2 or 3 measures
   Can mix activity, output and outcome
    measures
   Resource increases are not
    performance measures
   Attribution is key
             Module 3


Monitoring
         What is monitoring?



Ongoing assessment of the progress
of the activities being funded, with the
objective of determining if the terms
and conditions of the award are being
met and the goals are being met.
        What purpose does monitoring
                  serve?


   Provides oversight as required by
    agency – and covers you!
       What are they doing?
       What are they planning to do?
       What did they say they would do?
                  Techniques
   Pre-award risk        Analysis of reports
    assessment
                          Provide technical
   Site visits            assistance

   Telephone calls       Review reports
                           (program,
   Enforcement of         financial, audit)
    prior approvals
               Risk Assessment
   Types of Risk                Types of Risk
       Recipient stability          New program
                                      (HIV/AIDS)
       Geographic
        problems                     Public or
                                      congressional
       Amount of award               scrutiny


       Susceptible to               Lack of discretion
        fraud                         in making award
Documentation of Monitoring

   Trip reports

   Memos to the file

   Detail action taken

   Recommended actions
            Module 4


Developing a Monitoring Plan
        Designing a Monitoring Plan

   A monitoring plan should be –

       Specific to each award
       Part of an overall comprehensive
        approach to monitor all awards
       Flexible, able to accommodate changing
        circumstances
       Achievable
                  Considerations

   Are recipients grouped by types of programs?
   Are recipients grouped by geographic location?
   Do the recipients have similar characteristics?
   Are the grantees interchangeable or unique in
    capabilities?
   How do you choose grantees? Is there an
    adequate available pool?
   What is the impetus for the programs to be
    funded?

          Apply consistent approach to recipients
                  Customize accordingly
Elements of a Monitoring Plan
   Techniques to be used

   Inherent risks with the recipient or
    the program

   Resources available for monitoring

   Skills/Capacity of Grants Officer and
    Recipient
         Monitoring Techniques

   Site visits
   Telephone calls
   Reports
   Additional prior approvals
   Review of audit reports
       A-133 or OIG
         Evaluate Inherent Risk
   Risk can be program or financial
       What is the dollar amount of the award?
       Is the program susceptible to abuse?
       Is the recipient susceptible to abuse?
          Long-term recipients may be in charge of the
            program – too much authority and control
       What potential pitfalls are out there?
       What about geographic proximity of the
        recipient?
       Prior problems with grantee?
Determine Agency Resources

   What is necessary and desirable as
    opposed to what is practical?
       Corporate culture
            What is the level of importance given to
             monitoring of programs?
       Available staff
       Travel funds
   Can we combine monitoring with
    other activities?
Designing the Monitoring Plan

   Resources

   Methods

   Strategic Planning Goals

   Risks
          Exercise

Monitoring Plan for a Recipient
           Module 5


Budgets and Costs
    Definition of Budget


A detailed plan of income and
expenses expected over a certain
period of time.
           OMB Circular A-122

   Cost Principles for Non-Profit
    Organizations
       Establishes uniform and consistent
        principles for determining costs
       Rules for indirect cost rates
       Direct costs – 56 items listed
         OMB Circulars for …

Assistance to State        Assistance to Non-
    and Local Gov’s          profit Organizations
   Administration Of       Administration Of
    Grants A-102             Grants A-110 (22 CFR
                             145 and 2CFR 215)
   Cost Principles A-87    Cost Principles A-122


Assistance to Colleges
    and Universities
   Administration Of
    Grants A-110
   Cost Principles A-21
     Definition of Costs


The outlay made to achieve or
acquire an objective.
           Total Costs


Composition of all direct and indirect
costs.
                   Direct Costs

   Costs identified with a particular
    award
        Direct salaries
        Travel

        Equipment

        Supplies
            Cost Requirements

   Reasonable – the “prudent person”
    test.
       Are the costs necessary for
        performance of the award?
       Do the costs reflect sound business
        practices – leasing vs. purchase?
       Market prices – what is the going rate
        on the economy?
            Cost Requirements

   Allocable
       Are the costs incurred specifically for
        the award?
       Costs cannot be shifted from another
        award
       Costs must be in the budget
           Cost Requirements

   Allowable
       Are the costs prohibited by statute,
        regulation, or decision – OMB, GAO?
       In accordance with the Fly America
        Act?
       Within the authorizing and/or
        appropriating legislation?
               Indirect Costs

   Administrative costs (running the
    organization that cannot be
    specifically identified for a program)
        Facility costs (rent, utilities, insurance,
         taxes)
        Legal

        General/administrative salaries
         (accounting, administrative, executives,
         etc.)
Indirect Cost Rates - Domestic

   GPD 22 - Must be approved by
    cognizant agency
   For State – A/LM/AQM/IP
Indirect Cost Rates - Overseas

   Allowable cost – A/OPE suggests
    10% of the budget for indirect costs
   Make sure indirect costs are not
    also listed as direct items
   Ask recipient for breakout of the
    indirect charge
             Indirect Cost Pool
   Definition
       Total administrative costs to be
        allocated to projects by the use of an
        indirect cost rate
   Direct cost base
       All costs incurred in the direct
        performance of a project
          Salaries and wages
          Benefits

          Total direct costs
         Exercise A-122

In Table Groups, answer the
  questions in the “Exercise OMB
  Circular A-122”
           Budget Analysis
   Are costs reasonable, allocable and
    allowable?
   Do not accept summary budgets
   Review budget detail – how many
    employees, hours, salary rates
   Are items to purchase really
    necessary for the award?
   Are you helping build a business or
    just conducting a project?
                 Budget

   Negotiate items
   Are costs “wish list” items?
   Ask questions
   Ask for more detail
         Budgeted Costs

Review with a skeptical eye…
                     Exercise

   Budget Review
   As a group, evaluate the submitted
    budgets and costs.
   Are they:
       Allocable
       Allowable
       Reasonable
           Module 6


Cost Sharing
                Cost Sharing

   Definition
       Recipient provides a share of non-
        federal cash or “in-kind” services in
        support of the federal award.
       OMB A-110 – the portion of project or
        program costs not borne by the federal
        government.
     Cost Sharing Methods
   Cash – from individuals or other
    organizations
   In-kind – non-cash such as donated
    time and effort
   Program income – generated by
    program activities
    Why Require Cost Sharing?

   Buy-in from the recipient
   Raise responsibility level of recipient
   Adds to appearance of active
    monitoring and oversight
                Cost Sharing

   Must be documented and verifiable
    from records
       Other federal funds cannot be used for
        cost sharing
       Must be necessary for the program
       Must be included in the approved
        budget
Valuing In-Kind Contributions

   Volunteer or donated services –
    rates consistent with rates paid for
    similar work
   Donated Property – fair market
    value at time of the donation
              Module 7


Site Visits
                      Reasons
   Familiarization          Complex
    visit                     compliance
       Staff, business       requirements
        practices            When requested
   High                      by recipient
    dollars/complexity       Documentation
   Program visibility        review
   Prior negative
    history
              Prior to Visit . . .

   Notify recipient POC, program, and
    financial officials
       Discuss objectives for visit, including
        documents to review
       Determine issues to discuss
   Set an agenda
   Review grant file (DS-4012 form)
   Review the proposal and the Notice
    of Award
            While on Site . . .

   Conduct entrance discussion with
    officials
   Observe project activities
   Meet participants
   Review program and financial
    records
       Compare to submitted reports
   Property records
        A checklist can be very useful!
              After the Visit . . .


   Prepare report
   Document findings
       Negative and positive
   Review and adjust monitoring plan, if
    necessary
      Exercise Mock Site Visit
   Turn to Tab 22 Site Visit Exercise

   In Table Groups, role play the
    exercise, using the Site Visit
    worksheet to document your
    findings
   Write an Executive Summary of the
    site visit and outlining your
    recommendations
            Module 8


Substantial Involvement
           What is Substantial
             Involvement?
   No formal government-wide
    definition
       Agency participation – shared
        responsibility for project success
       Collaboration
       Consultation
       Intervention
       Control
   Difference between grant and
    cooperative agreement
        Examples of Substantial
            Involvement


   Designing aspects of a program
   Administering program elements
   Selection of participants, all staff
   Approval of all materials prior to
    publication
   Participating in the presentation of
    those published results
        What Isn’t Substantial
           Involvement?

   Site visits

   Monitoring

   Report review


    Under what circumstances would we use
           a cooperative agreement?
          Considerations/Issues
   Substantial involvement vs.
    excessive control
       Control of organization’s operations
       Decision-making for organization
       To avoid high-risk designation
       Use of agency seal
   Agency considerations
       Resources
       Tort liability
               Exercise

   Turn to Exercise on Substantial
    Involvement
   In Table Groups, answer assigned
    questions
   Discuss
          Module 9


Sub-Awards and
Pass-Throughs
                 Sub-Award

   Definition
       Award of assistance made under a
        grant to eligible sub-grantees

       A procurement contract under a grant
        is not a sub-award
                     Sub-Award

   History
       Devolution of control of federal funds in
        the 1980s to the states
       “New Federalism”
       Single Audit Act of 1984
            One audit required regardless of funding
       Recipients must monitor each program,
        activity, and sub-awards
            Pass Through

   Recipient essentially assumes the
    role of the agency
   Must have sub-award agreements
   Must ensure that all funds it
    receives, including sub-awards, are
    used properly
        Sub-Award Agreements
   Primary tool the primary recipient
    has for monitoring sub-grantees
   Should be detailed and describe
    responsibility of the sub-grantee,
    including reporting requirements
   Primary recipient should have a
    written monitoring plan for the sub-
    awards
       Plan approved by the agency
                Pros and Cons
   Pros                        Cons
       Ease                        Need larger dollar
       Shifts burden of             amounts to justify
        monitoring to pass          Lack of direct
        through                      control
                                    Large organization
                                     to deal with
      Sub-Awards – Recipient
         Responsibilities

   Compete sub-awards, if possible
   Have a method of evaluating sub-
    grantees
   Ensure sub-grantee is not
    suspended or debarred
   Monitor sub-awards
   Provide technical assistance, if
    necessary
           Module 10


Problem Resolution and Prior
Approvals
              Recipient Problems

   Problems require different levels of
    agency concern and action
       Material problems
            program or financial
       Immaterial problems
            program or financial
    Recipient Problems                (cont.)

   Intentional problems
        disregard for grant terms, laws and
         regulations, fraud


   Unintentional problems
        lack of experience and knowledge
     When Problems Arise . . .

    What do you do?
        Phone call
        Determine recipient solution
        Recommend solution
        Provide assistance
        Make high-risk distinction



At what point do you become aware of problems?
        Grants Officer Response

   To Unintentional Problems
       Review monitoring plan
       Render technical assistance
       Offer interpretation of rules and
        regulations
       Review terms and conditions of the
        award
       Conduct site visit to inspect records
        retention
       Refer recipient to organizations that
        provide training in grants management
        Grants Officer Response

   To Intentional problems
       Require particular guilty employee be
        removed from the project
       Pursue civil or criminal penalties
       More common corrective actions
        include suspension or termination of
        the award, withholding payments, or
        not renewing a grant.
              EXERCISE

   Turn to Exercise – Remedies for
    Non-Performance
   Table Groups – Answer questions as
    assigned
   Discuss
          Agency Problems

   Poor award instruments
   “Hands off” for too long
   Waiting too long to intervene
   Allowing problems to grow
   Staff shortages prevent regular
    monitoring of awards
   GORs poorly trained in
    responsibilities of grant management
Don’t let this be you!
               Changing Recipient
                  Institutions

   Reasons
       Loss of primary project manager
       Recipient ceases operations
       Award terminated


   Replacement grants
              Prior Approvals

   Form of monitoring
   Circular A-110 has guidance
   Grantee risks
       Non-payment
       Suspension
       Termination
        . . . if it disregards the requirement
     Exercise - Prior Approvals

   Find Exercise

   Use Tab 11 – OMB Circular A-110 as
    reference to answer questions

   In Table Groups take5-10 minutes
    to answer questions – prepare to
    discuss as a class
    What Needs Prior Approval?
   Additional funds        Budget revisions
                             over 10%
   Change in scope of
    the project or          Pre-award costs
    objectives
                            Sub-awards
   Change in key
    personnel if            Time extensions
    identified
           Module 11


High Risk Recipients
                 OMB Circulars

   A-110 and A-122
       Both have requirements regarding high
        risk recipients
       Process for correction
       Overseas
          Less restrictive
          Can add requirements to the agreements
                Indicators
   Inexperience           Questioned costs
   Poor prior              from audit
    performance            Violations of grant
   Program behind          terms
    schedule               Management
   Fraud – suspicion       problems
    or actual              Financial instability
             Exercise – A-110

   Exercise on OMB Circular A-110
       2 CFR Part 2.15
   Use Circular (Tab 11) as reference
   Each table group answer one
    section of questions
                   Solutions

   Special terms and conditions
       Cost reimbursement
       More frequent reports
       More report detail
       Additional prior approvals
       Program phase approvals
         Definitions from A-122

   Suspension
       Temporary withdrawal of Federal
        sponsorship, pending corrective action
   Termination
       Cancellation of Federal sponsorship, in
        whole or in part, at any time prior to
        the date of completion
   Debarment
      Terrorism Requirements



   GPD 19 – consult Department of the
    Treasury Excluded Parties List
    System www.epls.gov
   May be other vetting requirements
    set out at post
         Module 12


Audits
     What does “audit” mean?

   Examination of financial operations
    and work
   Review of compliance with
    applicable laws and regulations
   Evaluation of economy and
    efficiency of operations
   Evaluation of effectiveness in
    achieving program results
            “Audit” means . . .


   In the assistance context, it means
       A look at the past performance of an
        entity, program or function to
        determine whether funds and property
        were properly administered and
        whether the projects have met or
        fallen short of program intent and
        expectations.
            Internal Controls
     The plan of organization, methods
    and procedures adopted by management
    to ensure that resource use is consistent
    with laws, regulations, and policies;
   that resources are safeguarded against
    waste, loss and misuse;
    and that reliable data is obtained,
    maintained, and fairly disclosed in
    reports. (General Accounting Office)
              Types of Audits

   Affect both overseas and domestic
    awards
       A-133 Single Audit

       OIG Audits

       GAO Audits and Reports
                  Audit Process

   Objectives
       What are we doing and why?
   Scope
       Program, time period
   Methodology
       How
   Findings
       Results
                Audit Terms

   Materiality
       Matter of professional judgment
       Influenced by auditor’s perception of
        the needs of a reasonable person will
        rely on the assertion audited
   Reasonable Assurance
   Negative Assurance
                Audit Terms
   Control deficiency - exists when the design or
  operation of a control does not allow management
  or employees, in the normal course of performing
  their assigned functions, to prevent or detect on a
  timely basis noncompliance with a type of
  compliance program of a Federal program.
 Significant deficiency - a control deficiency, or
  combination of control deficiencies, that adversely
  affects the entity’s ability to administer a Federal
  program such that there is more than a remote
  likelihood that noncompliance with a type of
  compliance requirement of a Federal program
  that is more than inconsequential will not be
  prevented or detected.
                 Audit Opinions
   Unqualified
       In our opinion, the F/S present fairly, in all
        material respects
   Qualified
       Except for . . . the F/S present fairly
   Adverse
       Do not present fairly, in all material respects
   Disclaimer
       No opinion; evidence not available (not
        auditable) to make a determination
          Other Audit Concerns

   Going concern
       Company will not be able to continue to
        operate indefinitely (one year)


   Separation of duties
       Authorizing, processing, recording,
        approving
              EXERCISE


   Review the audit report in Tab 12

   Spend 5-10 minutes in Table
    Groups discussing issues
    Office of Inspector
          General




Overview of the OIG
Audits, Inspections and
Investigations
                      AUDITS
   Performance
       Assessment of performance to improve public
        accountability and facilitate decision-making.


   Financial
       Reports on whether an entity’s financial
        information is presented fairly, implementation
        of proper internal controls and compliance with
        laws and regulations.
    AUDIT PLANNING PROCESS

   Develops annual plan
   Plan based on:
       Legal requirements
       OIG knowledge and experience
       Requests (Bureaus and Congress)
       Governmentwide interest
   Unanticipated audits
       AUDIT TEAM AT POST

   Narrow focus – in-depth review of
    program or issue
   Specific post involvement
   Short duration
   Systemic or post-specific issues
               INSPECTIONS
   Systematic evaluation of
    Department operations – posts and
    bureaus
   Evaluate all post operations
       Includes assessment of post
        management, security issues,
        intelligence/law enforcement
   Broad focus
   Issue post-specific reports
        INSPECTION FOCUS
   Policy Implementation
       Achieving policy goals and objectives
       Representing US interests
       Coordinating all elements of a post
   Resource Management (Diplomatic
    Readiness)
       Effectively and efficiently uses and
        manages resources
       Accurate reporting of financial transactions
        and accounts
   Management Controls
       Complies with applicable laws/regs.
       Develops and implements internal controls
       Identifies instances of fraud, waste and
        abuse
        INSPECTION SCHEDULE

   Inspection cycle
       Every post every 5 years
       Requests or specific issues
   Composition of Team
       Broad range of skills and background –
        primarily FSOs
       Team size depends on post and
        assignment
      INSPECTION PROCESS

   Advance questionnaires (OIG
    website)
   Survey
   Fieldwork
   Reporting
   Compliance
     INVESTIGATORS AT POST

   Minimal notification
   Focused on specific allegation
   Support RSO at post, including local
    law enforcement
   Officials kept informed of status of
    investigation, but written reports
    are rarely provided
     INSPECTION EVOLUTION

   Increased focus on management
    and leadership
   Focus on treatment of FSNs
   More resources on security and IT
   Highlight best practices
           FMO INSPECTION
   Inspection of financial management
    covers all section operations

       Budgeting
       Fund management
       Payments
       Payroll
       Allowances
       Cashiering
            INVESTIGATIONS

   Criminal, civil, and administrative
    misconduct related to organizational
    programs and operations
   Examine allegations, reports or
    other information indicating possible
    violations of laws or regulations
       Violations of federal laws – DOJ
       Administrative violations – HR, DS
EMPLOYEE RESPONSIBILITIES

   Report all information with the
    appearance of waste, fraud, abuse,
    or mismanagement to the OIG
       Executive Order 12674 (April 12, 1989)
        Federal Principles of Ethical Conduct for
        Government Officers and Employees
          Module 13


Fraud, Waste, Abuse and
Mismanagement
                          Fraud

   Definition
       Intentional misstatements or omissions
       Failure to disclose
       Misappropriation
            Theft, defalcation (lying)
       Irregularity
            Intentional non-compliance
       Collusion
            Two or more working to conceal
                   Red Flags
   Too much white-out           Loans to staff/board
   Excessive photocopies         members
    instead of originals         Too much cash lying
                                  around
   Checks written to
                                 Excessive transactions
    cash/employees                (adjusting entries) in
   Splitting payments to         financial system
    avoid dollar thresholds      Excessive bank
   Sales of assets to            accounts
    employees or relatives       Strange alliances –
                                  subletting office
                                  space, off-the-book
                                  deals
             Considerations


   Need evidence to pursue
   Difficult to recover stolen assets
   Overseas – rarely prosecute or
    investigate
              Waste, Abuse and
              Mismanagement

   Lower level than fraud
   Can be difficult to pursue – must
    confront management
   Whistleblower
       Difficult course of action
       Department Notice
   Investigations – do not guarantee
    anonymity
           Module 14


Financial Systems and Records
         OMB Circular A-110
   Uniform Administrative Requirements
      Establishes uniform administrative
       requirements
         Pre-award

         Post-award

         Financial and program management

         Reports and records

         Termination and enforcement

         Closeout
          Financial System

    A good financial system should
    provide:
   Effective Budgetary Controls
   Effective Cash Management
   Effective Reports of Timely and
    Accurate Financial Information
      Financial System

Adequate system lies somewhere
between the “shoebox” system and
electronic system.
         FINANCIAL SYSTEM



   OMB Circular A-110 requires
    “Recipients to relate financial data
    to performance data and develop
    unit cost information whenever
    practical. “
     INTERNAL CONTROLS
Good Financial System= Good Internal Controls

Internal controls are a means by which an
  organization's resources are
 Directed
 Monitored
 Measured
 It plays an important role in preventing
  and detecting fraud and protecting the
  organization's resources, both physical
  and intangible
        ELEMENTS OF INTERNAL
              CONTROL

   Accounting            Policies and
       Cash Ledgers       procedures
       Support               Position
        Documents              Descriptions
       Audit trail           Roles and
   Business records           Responsibilities
                              Personnel manual
       Banking
                              Travel Procedures
       Employment
                              Training Policy
       Time Sheets
                              Procurement Policy
       Contracts
      DISCUSSION – FINANCIAL
           MANAGEMENT

   Tab 14 - Financial Management
    Guide for Non-Profit Organizations

   What are some examples of
    “shortcomings?”
           Module 15


Reports - Program and Financial
Purpose and Types of Reports
   May serve as only visible indicators of
    program activity and expenditure of funds
   Read and analyze!
   Two types of reports that should
    encompass the same period of time for
    comparison and analysis purposes
       Program
       Financial
              Program Reports
   Format
       No standard government-wide format
   Frequency
       Not more than quarterly or less than annually
   Content
       Comparison of actual results with stated goals
        and objectives
       Reasons goals and objectives were not met
       Other information as appropriate
          Significant events that occurred
              Report Review

   Do the reports –
       Provide sufficient information?
       Show that adequate progress is being
        made?
       Raise red flags?
       Contain information that is useful for
        GPRA and performance measures?
            Financial Reports

 Purpose
  To certify expenditure of funds

  Evaluate project progress

  Account for funds

  Show cash needs



        Compare to progress report.
Does progress correlate to amounts expended?
            Are they consistent?
        Financial Reports Review
   Financial reports are reviewed by the
    Grants Officer and GOR for compliance
    with the terms and conditions of the
    award.
   The review generally consists of ensuring
    that:
       Costs are incurred and reported within the
        authorized period;
       Costs are in accordance with the authorized
        items of expenditures; and
       Calculations are accurate.
    Exercise - Financial Reports

      In Student Handbook, review
    and discuss the sample grant
    financial reports.

   Look for the mistakes in the
    reports.
           Module 16


Grant Closeout
        Definition of Closeout

   The award closeout is the process
    by which a determination is made
    that all applicable administrative
    actions and all required work have
    been completed.
             CLOSEOUT


Recipient’s responsibility:
 Submit all financial and
  performance reports within 90
  calendar days after the date of
  completion
 Liquidate all obligations within 90
  calendar days of completion date
 Promptly refund any excess
  balances of unobligated cash
      Do Not Close Grants If…

   Refunds not submitted
   Actions not completed
   All costs not paid to recipient
   Excess funds not deobligated
   All reports are not submitted
   Final NICRA has not been received
    DISPOSITION OF PROPERTY


   Equipment with a value of less than
    $5000 may be retained, sold or
    otherwise disposed of with no
    further obligation to the awarding
    agency
   For equipment over $5000
    recipients must request disposition
    instructions from the Department
            CLOSE OUT FILES

   At a minimum, before an award can be closed,
    the following documents must be available:
       Basic Notice of Award and All Award Amendments
       SF-270 Request for Advance (if not registered on
        PMS)
       SF 269 Financial Status Reports
       SF 272 Report of Federal Cash Transactions Reports
       Program Reports
       Final Negotiated Indirect Cost Rate Agreement
       Resolution of Audit and Disallowed Cost
       Property/Equipment Status Report
       GFMS/CFMS/RFMS Reports
       PMS Reports
SETTLEMENT OF ACCOUNTS


   Reconcile final financial report with
    approved award budget.
   Identify any disallowed costs.
   Collect unused or disallowed funds.
   Deobligate unliquidated balances
    COLLECTION OF AMOUNTS
             DUE


   Must collect amounts owed to USG
   Federal Claims Collection Standards
   Make administrative offset against
    other requests for reimbursement
   Withhold advance payments due the
    recipient
   Other action as permitted by statute
    RETENTION OF RECORDS


   Financial records, supporting
    documents, statistical records, and
    all other records pertinent to an
    award must be retained by the
    Grants Office for a period of three
    years.
           Module 17


Miscellaneous
        Forms – A Last Look
   DS-1909 – Federal Assistance
    Award
   DS-1909A – Amendment to Federal
    Assistance Award
   DS-4012 – Assistance Award File
    Folder
   SF-424 – Application (OMB)
   SF-269 – Financial Report (OMB)

								
To top