Do you wish you had a subrecipient monitoring FAQ guide to identify the major areas of grant monitoring risk?
But are you wondering what exactly that looks like for grant management?
Here are seven areas of monitoring to help you start the conversation and assess your risk as the primary grant recipient:
Area #1: Is This Your First Grant Management Rodeo?
As the primary recipient of the grant, you need to know how much experience your subrecipient has with federal grants.
For example:
- How many subawards have you managed in the last five years?
- How experienced is your staff with this type of program work?
- Has there been high staff turnover or reorganization associated with this program?
- What procedures and policies do you have in place for managing federal funds?
- How many awards or subawards have you done with federal funds?
- What challenges did you face managing federal funds?
- What training has your staff received on the Uniform Guidance?
Area #2: Ever Been In Trouble with the Law?
Award recipients must ensure federal funds are not flowing to people or organizations that are suspended or debarred or have other legal issues.
It starts with questions like these:
- Have the organization staff been jailed, placed under criminal investigation, or convicted of a felony?
- Has the organization been the subject of a lawsuit?
- Are you under investigation by a local, tribal, state, or federal government?
- Has a funder terminated an award with your organization before?
- Have you, your staff, or your organization ever been suspended or debarred from federal funds?
- Have you ever had a federal award involuntarily terminated?
Area #3: Are You Staying in Touch With the Prime Recipient?
Some of the ways that grantees fulfill their monitoring requirements are to perform site visits and review subrecipients’ audit reports-particularly Single Audit findings.
Here are some things to ask:
- How often are you in communication with your pass-through entity?
- How would you notify your funder of potential issues with the project?
- How long has it been since an on-site monitoring visit?
- How long since your last audit was completed?
- Were there audit findings?
- How are federal terms and conditions communicated to your staff?
- What is your process if an employee is concerned about a conflict of interest?
- How does your senior leadership communicate the importance of ethics?
Area Four: How Do You Keep Federal Funds Straight?
Grant recipients and subrecipients must have systems in place for grant monitoring to identify the inflows and outflows of federal funds by the individual programs.
To determine if your subawardee complies, start here:
- What financial management system are you using to track and record program costs?
- How does your accounting system track expenditures and receipts of the various programs?
- How do you track the time spent working on a program?
- Does your organization have an approved indirect cost rate agreement?
- How are staff trained on what costs are allowable vs. unallowable?
- How do you identify direct vs. indirect costs?
Area Five: Is Financial Oversight Pretty Loosey-Goosey?
Would you know if someone was running off to Fiji with federal funds (or hosting extravagant GSA Las Vegas conferences-complete with mind-readers)?
A good place to start is to learn what internal control systems are in place.
For instance:
- Who reviews variations between the project budget and the actual spending?
- Is the grant spending a large percentage of the organization’s total budget?
- Is there a lot of discretion for spending on the part of program managers, direct employees, or senior staff?
- What internal controls are in place for your federal awards?
- What is your authorization process for spending federal funds?
- How do you train staff on their responsibilities for internal controls?
Area Six: Is the Subrecipient Financially Stable?
Subrecipient monitoring includes making sure the subrecipient is financially stable enough to complete their scope of work.
Here are some areas to check on:
- Do you have the financial resources to complete your scope of work for the project?
- Has an agency ever placed restrictions or special financial conditions on your subawards?
- Have you had an insufficient fund balance after meeting your obligations on a program?
- Do financial reports indicate cash flow issues?
- Has an agency ever placed restrictions or special financial conditions on your subawards?
- Has an agency or authority placed your organization under a special financial condition such as a “watch-list” or “high-risk” status?
Area Seven: Have You Focused Subrecipient Monitoring for the Program Objectives?
Finally, the grantee is responsible for monitoring that the subrecipient meets the program objectives for their scope of work.
Ask them:
- How does the organization communicate the performance objectives for the program to staff?
- Has the organization achieved its performance objectives for past programs?
- What is the subrecipient’s process for notification if things are not going as expected?
- Has the organization filed its required reports promptly to the prime recipient and the Federal government, as required?
- Has the subrecipient reviewed the performance measurements for the award?
Adequate subrecipient monitoring generally requires a joint effort across various personnel within the primary grant recipient’s organization.
For grantees, it is important to note that monitoring includes both the actual risk assessment and documentation of the results of that process.
It’s not done until the results are documented.
Don’t forget the paperwork.