If you are a federal grant recipient, you probably know that a lot changed with the implementation of the new Uniform Guidance for grants.
But you may not realize that one of the goals of this change was to reduce the number of audit findings.
Better Grant Management Means Less Audit Findings
In fact the new guidance has an emphasis on something called “Cooperative Audit Resolution”
In other words, the funding agencies what to work with you to get problems cleaned up so they don’t occur again in the future.
Just in case you think you are the only one who has experienced audit findings or other deficiencies…it is more common than you may realize.
Our research in 2010 noted audit findings of varying levels of severity in nearly 1/3 of Organizations in our sample.
Now no one wants to think about audit findings corrective action plans, but the reality is that many grant professionals will have experience with either producing or implementing a corrective action plan during their career. So how do you write a corrective action plan?
Writing a Corrective Action Plan
The first thing we need to understand is what a corrective action plan is. Basically, when a certain system, project, or program has some problems, a corrective action plan comes into play. It can also be defined as the “fix”, used when there are defects in a process, oversight, or training affecting the administration or management of the tasks at hand.
A corrective action plan can be designed by following a few simple yet systematic steps.
Getting at the Root of the Issues: Root Cause Analysis
In order for us to be able to give a solution to any problem, we must recognize the nature of the issues involved. Proper analysis is very necessary. A good corrective action plan starts with an analysis of the “root cause” of the identified issues. We need to find out the following things:
- What is the exact issue that is causing the problem at hand?
- Are there flaws in the work processes that led to the issues?
- Has this type of issue occurred before?
- If it has, what caused to recur?
Steps to Implement: Corrective Measures
After understanding the root of the problem, the next step is to devise a way to rectify the mistakes made previously. This generally involves defining a set of steps through which correction can start. It is always easier to tackle issues once you know where to begin. The steps may vary, but the action words that are used in the corrective measures section of a corrective action plan are eerily familiar. Well written corrective action plans will often start this section with the following terms:
Remember that your approach should start from the root cause of the problem and then move forward, through the corrective measures to lay out a plan to eliminate the issue completely.
Making the Plan Reality: Expected Outcomes
The next step in making the corrective action plan a reality is to envision the expected outcomes and key success measures. How will you know if corrective measures are working or not? The expected outcomes section is where you spell out the criteria to know if the plan is working as expected. The outcomes should follow the “SMART” principles:
Other Key Elements:
Finally, the corrective action plan comes together with the real work: Who is going to do what and when will that be done?
A strong corrective action plan contains the following elements as part of the total plan:
- Accomplishments – What have we done so far?
- Actions – What is left to do?
- Responsible Parties – Who is doing what?
- Completion Dates – When will it be done?
Of course, completing the corrective action plan is really just the beginning of the process. The areas that gave rise to the findings should be carefully monitored and supervised, so that the flaws which existed in the original action plan are not repeated.
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Lucy Morgan CPA, MBA