In our last post, we looked at 6 questions you should ask to tell how safe your federal grant is from conflicts of interest.
In today’s post, we’ll look at what you can do to reduce the risk of a conflict of interest affecting your organization and your federal funding.
Here are 5 Ways to Reduce the Risk of a Conflict of Interest
While it is nearly impossible to stop all risk of grant fraud, here are five things that professional grant managers can do to reduce the risk of a dangerous conflict of interest:
#1 Identify and Disclose Risks
Potential conflicts of interest should be identified and disclosed to the appropriate level of the official at the organization to get guidance and advice concerning the specifics of the situation. If you have a federal grant, you are also required to disclose potential conflicts of interest to your funding agency to stay in compliance with your grant management.
#2 Communicate and Educate Grant Staff
Organization officials should take steps to communicate the conflict of interest prohibitions to everyone involved in managing grants. Additionally, others who may work indirectly with grant personnel such as purchasing staff should be educated on what to look for with regard to conflicts of interest in fact, and appearance.
#3 Document the Process for Clarity
Require a transparent, fair and fully-documented procurement process and a regular review and maintenance of the conflict of interest statements signed by individuals responsible for purchasing goods and services. Documentation of the process will not only provide a roadmap for grant managers and others but can also expose holes in your process before a costly conflict of interest occurs.
#4 Watch Consulting Charges
When consultants are used, extra care should be taken to substantiate that their rate of pay reflects the market rate for the unique skill set being utilized and that the final result of the engagement is well-defined and a record of the results is kept. Professional services costs receive an added layer of scrutiny because of many past problems with this area of charges.
#5 Talk to Staff About Requirements
Managers and other key personnel who understand the requirements can often identify where noncompliance is likely to occur and where the risks from conflicts of interest such as kickbacks, related party transactions, and bribery could occur. Keeping grants in compliance takes everyone understanding what the requirements say about conflicts of interest.
Key Components to Reduce Risk
In the end, the existence and proper implementation of policies such as a codes of conduct and written procurement process that spell out acceptable practices, conflicts-of-interests, or expected standards of ethical behavior at your organization are all key components of keeping your grant safe from the risk of conflicts of interest that will put your federal grant in jeopardy.
Want to learn the basics of grant management? Find out more about our Grant Management Boot Camp training.
Lucy Morgan CPA, MBA
CEO, Compliance Warrior