Preston Alderman

MSDE, Director of Audit

As recipients of federal and state funds we are charged with ensuring that the funds are adequately accounted for and spend in accordance with the grant assurances.

Receipt of those funds also subjects the recipient to being monitored and audited regarding the use of the funds.

Monitoring tools must be consistent with the following; Grant assurances Federal (OMB) regulations/policies

(including testing of expenditures) State regulation/policies Agency policies

EDGAR (Education Department General Administrative Regulations)has been updated.

Cost , administrative & auditing rules are located in 2 CFR Part 200

The effective date of the changes are; December 26, 2014 –Direct Grants from ED July 1, 2015 – State Administered Programs July 1, 2016 – Procurement Rules

Focus on outcomes Performance metrics Risk assessments Financial management Audit thresholds Major emphasis on strengthening

accountability by improving policies that protect against waste, fraud and abuse

Review the criteria for determining allowable costs: Part 76 State Administered

ProgramsGovernmental units assume

responsibility for administering Federal funds in a manner consistent with underlying agreements, program objectives, and the terms and conditions of the Federal award.

Reasonable costs

Review 2 CFR Part 200 Subpart D – Post Award Requirements Purpose of financial and program

management Standards for financial

management systems Purpose of reports and records Monitoring and reporting program

performance

Review 2 CFR Part 200 Subpart D – Post Award Requirements Termination

If a recipient materially fails to comply with the terms and conditions of the award

Review 2 CFR Part 200 Subpart D – Post Award Requirements Enforcement

Temporarily withhold payment pending correction of deficiency

Disallow all or part of the cost of the non compliant activity

Wholly or partly suspend or terminate the award

Review 2 CFR Part 200 Subpart E

55 specific costs detailed

Listed in alphabetical order

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Necessary, reasonable & allocable Conform with federal law & grant terms Consistent with state && local policies Consistently treated In accordance with GAAP Not included as match Adequately documented

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COMMON PROBLEMS Controlling allowable costs Clear record trail Cash management

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Identification of Awards (new) Financial Reporting Accounting Records Internal Control Budget Control Written Cash Management Procedures

(new) Written Allowability Procedures (new)

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Accurate, current and complete disclosure of financial information All financial reports required by ED, must

be submitted no less than annually, no more than quarterly.

Non federal entities must submit performance reports at intervals by federal agency or pass through.

Performance metrics must be included.

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Must identify source and application of funds (expenditure level detail): Award amount Authorizations Obligations Unobligated balances Assets Liabilities Expenditures Income

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Internal controls are tools to help program and financial managers achieve results and safeguard the integrity of their programs Includes processes for planning,

organizing, directing, controlling, and reporting on agency operations

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