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Securing and Documenting Match and In-kind Support
Gregory Winn, Sr. Grants Advisor, OGMSusan Meche, Meche Consulting
Corporation Grantee Financial Accountability Seminar July 2007
Session Objectives
Gain knowledge of match requirements at basic and more advanced levels
Gather and retain proper match documentation for accountability and audit review
Learn about types and examples of match andhow to address complex requirements
Corporation Grantee Financial Accountability Seminar July 2007
Allowability of Project CostsTo be allowable under a grant, costs must:
■ Be reasonable and allocable for the performance of the award
■ Conform to grant award limitations or cost principles■ Be consistent with policies and procedures that apply to both
federally-financed and other activities of the organization ■ Be given consistent treatment■ Be in accordance with Generally Accepted Accounting
Principles (GAAP)■ Not be included as a cost or used to meet cost sharing or
matching requirements of any other federally-financed program
■ Be adequately documented
OMB Circulars – see handout
Corporation Grantee Financial Accountability Seminar July 2007
Grantee Share or MatchCash and in-kind contributions are accepted as part of the grantee’s cost sharing or matching when contributions meet all of the following criteria:
■ Are verifiable from the grantee's records■ Are necessary and reasonable for proper and efficient
accomplishment of project or program objectives■ Are allowable under the applicable OMB cost principles■ Are not paid by the Federal Government under another
award, except where authorized by Federal statute to be used for cost sharing or matching
■ Are provided for in the approved budget■ Conform to other grant provisions or OMB Circulars
Question: How would you estimateand record the value of PSAs? (See FAQ Sheet)
Corporation Grantee Financial Accountability Seminar July 2007
Talking Technical: Definitions to Know
Total allowable expenditures incurred to operate the program and accomplish its objectives
Portion of total expenditures paid for with Federal funds (CNCS)
Portion of total expenditures not paid for with Federal funds (CNCS) – Key Point – grantee share is recorded and documented the same as CNCS funding
Project Costs
Federal Share
Grantee Share
Corporation Grantee Financial Accountability Seminar July 2007
More Technical Talk
■ Gross income earned by the grantee that is directly generated by a supported activity or earned as a result of the award Key Point: There are three ways to address the use of program income – [see FAQ sheet]
■ Value of non-cash contributions provided by non-Federal third parties
■ May be in the form of real property, equipment, supplies, services, and other expendable property
ProgramIncome
In-KindContributions
Corporation Grantee Financial Accountability Seminar July 2007
Where Can You Find Match?
Cash: ■ Donations■ Non-federal income■ Local governments■ State appropriations■ Foundation grants or corporate
contributions
In-Kind Contributions:■ Value of donated services and/or donated goods
Unfunded Indirect Costs:■ The portion of indirect costs not allowed by CNCS in Federal Share
Government-wide, with few rare exceptions, Grantees cannot use other Federal funds as match
Corporation Grantee Financial Accountability Seminar July 2007
Exception: Volunteer Match
Do not count as match -
■ The value of direct community services performed by volunteers
Do count as match -
■ Services that contribute to organizational functions
■ Count services such as accounting, training of staff or members that are elements of the grantee’s cost allocation plan
Corporation Grantee Financial Accountability Seminar July 2007
How to Record In-Kind Contributions■ Maintain adequate documentation to support
amounts claimed as match
■ Maintain same documentation for both CNCS Federal share and for grantee’s share
■ Documentation must meet same standards as other expenditures
■ Record donation and valuation of item in detail
■ Enter into the general ledger as income and expenditure
■ Failure to enter match contributions into general ledger requires a formal explanatory policy and separate spread sheet accountability of receipt and use
Corporation Grantee Financial Accountability Seminar July 2007
Statement of Financial Accounting Standards
(SFAS #116) sets the standard: Contributed services are recognized in
financial statements if services received:
Create or enhance non-financial assets
Requires specialized skills provided by individuals possessing those skills
Would need to be purchased if not provided by donation
Why Record In-Kind in General Ledger?
Corporation Grantee Financial Accountability Seminar July 2007
Recording In-Kind Contributions
Enter into the general ledger as income and expenditure:
Example:Local paint store donates a professional paint sprayer with a fair market value of $550.00
$550.00 – 7250 In-Kind Expenses Account (debit) $550.00 – 5250 In-Kind Income Account (credit)
Corporation Grantee Financial Accountability Seminar July 2007
Defining Source Documentation:
Benefits: Supports a value, cost, or performance criteria relative to the grant
Physical information: ■ Hard copy■ Soft copy: CD, flash drive, server, microfilm
Source: ■ Internal source■ External source
NB: Federal Funds and match are maintained and documented the same way with the exception of in-kind match contributions
Corporation Grantee Financial Accountability Seminar July 2007
Why Retain Documentation?
To track incoming information To review information To provide historical evidence To provide evidence of
accomplishments To prepare for an audit How do you maintain
documentation? Internal controls and security for your financial system (see handout)
Corporation Grantee Financial Accountability Seminar July 2007
Retaining Source DocumentationRetain all financial records: 3 years from date of submission of final Financial
Status Report Final report submitted by Commission or Parent of
National Direct 3 years from final audit resolution when there is an on-
going auditExample 1:
Grant Ends 7/31/2009 90 days to submit Final
FSR = 10/31/2009 3 years = 10/31/2012
Example 2:
Grant Ends 7/31/2009 90 days = 10/31/2009 3 years = 10/31/2012 Audit started = 4/1/2012 Final audit resolution = 9/30/2013 3 years = 8/31/2016
Corporation Grantee Financial Accountability Seminar July 2007
Documentation Examples
Benefits
Training
Admin
Supplies
Evaluation
Contract &Consultant
Salary Travel
Volunteer orMember Costs
Corporation Grantee Financial Accountability Seminar July 2007
Identifying Documentation
Signed timesheets with supervisory approval
Quarterly payroll returns (941) Payroll register Personnel file with salary/wage information Employment contract Cancelled checks/Direct deposit schedule
Salary
Corporation Grantee Financial Accountability Seminar July 2007
Time & Activity Reporting SummaryAll salaries and wages charged to grants must be supported by signed time & attendance records, i.e., timesheetsExceptions:
State, Local and Indian Tribal governments must comply with requirements of OMB A-87
Educational Institutions must comply with requirements of OMB A-21
{See Handout for specifics depending on Grantee Type i.e. State, Local and Indian Tribal Governments, Educational Institutions and Non-Profit Organizations}
Corporation Grantee Financial Accountability Seminar July 2007
Identifying Documentation
Insurance policy
Paid invoices and receipts
Cost allocation plan
Benefits
Fringe benefits are allowable, provided such costs are absorbed by all organization activities in proportion to the relative amount of time or
effort actually devoted
Corporation Grantee Financial Accountability Seminar July 2007
Identifying Documentation
Authorization/reimbursement request NB: You must have written policies and procedures on hand on how to authorize and reimburse travel
Paid invoices and receipts Per diem rates (applicable for area) Mileage calculation Reconciliation of advances to payments
Travel
Travel costs must not exceed charges normally allowed by the organization in its regular operations based on the
organization’s written travel policy
Corporation Grantee Financial Accountability Seminar July 2007
Identifying Documentation
Purchase orders
Packing slips
Paid receipts and invoices
Donated Supplies, i.e., in-kind
Supplies
Corporation Grantee Financial Accountability Seminar July 2007
Identifying Documentation
Purchase orders
Signed agreements
Paid invoices and receipts
Contract &Consultant
Maximum Allowed by CNCS for Consultant fee is $540 per day. In charging contract services it is important to differentiate
among days of prep time, number of days of activity, travel and per diem where applicable.
Corporation Grantee Financial Accountability Seminar July 2007
Identifying Documentation
Agenda Course description, cost Sign-in sheet Consultant/Trainer agreement Paid invoices and receipts While the cost of the training, itself, is
usually allowable, one cannot include the value of the time given by the attendees to participate.
Training
Corporation Grantee Financial Accountability Seminar July 2007
Identifying Documentation
Purchase orders Signed agreement/contract Paid invoices and receipts Final copy of the evaluation report
Evaluation
Corporation Grantee Financial Accountability Seminar July 2007
Identifying Documentation
Meal receipts Uniforms invoices and receipts Insurance invoices and receipts Recognition invoices and receipts Travel invoices and receipts Physical Examinations invoices
and receipts* Senior Corps only
Volunteer Costs*
Corporation Grantee Financial Accountability Seminar July 2007
Identifying Documentation
Member eligibility Signed member contract Member timesheets signed by both member and
supervisor Documented pay system Signed mid-year and final member evaluations Were donations received with restrictions on their use,
or on the time of their allowable use? Can grantee use cash contribution for a prior period retroactively of member cost or not? Were contributions received timely and used during the course of the award, or only at the end of it?
Member Match
Corporation Grantee Financial Accountability Seminar July 2007
Program Match Requirements
(SEE HANDOUT SUMMARIES)
Corporation Grantee Financial Accountability Seminar July 2007
More Technical Talk: Match Requirements
Minimum matching amount the law requires a grantee to provide
Minimum matching amount established by CNCS regulations that may be higher than the statutory requirement
Amount of match grantee provides based on budget, budget narrative, and program narrative contained in grant application; may be greater than statutory or regulatory required match
Statutory
Regulatory
Budgeted
Corporation Grantee Financial Accountability Seminar July 2007
Sustainability for AmeriCorps and Service Learning: The Ultimate Goal
NewProgram/Project
MatureProgram/Project
Grantee Share
CNCSShare
CNCSShare
GranteeShare
Corporation Grantee Financial Accountability Seminar July 2007
Valuing In-Kind Donations
Use Fair Market Price
Consider what it would cost to obtain similar good or service
Value of donation should be placed by the donor
Review donation letter or form to ensure the value is reasonable and compare with other estimates or bases for value
Corporation Grantee Financial Accountability Seminar July 2007
Documenting In-Kind Contributions
Document in-kind contributions to show: What service or goods were obtained
Why transaction is allowable for
grant purposes
The value of the contribution
How it is traced back to source documentation
If audited, a grantee may be required to obtain full supporting documentation from all donors if not
available during the audit.
Corporation Grantee Financial Accountability Seminar July 2007
Documenting In-Kind Contributions
1. Document the basis for determining value of personal services, material equipment, building, and land
2. Obtain written acknowledgement of the contribution including:
Name and signature of donor
Date and Location of donation
Detailed description of item/service
Estimated value of contribution, how value was determined, who made the determination
Was the contribution obtained with Federal funds*** Keep a copy of the receipt in your files ***
Corporation Grantee Financial Accountability Seminar July 2007
Sample 1: In-Kind Contribution Form
The ABCD Tutoring Program 1299 N Main Street, Suite 110, Great City, Good State 00000-1234, (800) 555-1212, Fax 321-1234
Date of Contribution
Description of Contributed Item(s) or Service
Purpose for Which Contribution Was
Made
Real or Approximate Value of Contribution
How Was Value Determined? (i.e. Actual,
appraisal, fair market value)
Who Made This Value
Determination?
Was Contribution Obtained With or
Supported By Federal Funds? (If so, indicate
source)
Name of Contributing Organization/Agency/Business/Individual:
Address of Above Contributor: Phone #:
Printed/Typed Name of Contributor’s Authorized Signee: Title:
Signature of Authorized Signee: Date:
In-Kind Contribution Form
See Handout
Corporation Grantee Financial Accountability Seminar July 2007
Sample 2: In-Kind Contribution Form See Handout
Corporation Grantee Financial Accountability Seminar July 2007
Exercise
In-Kind or Not?
Corporation Grantee Financial Accountability Seminar July 2007
Common Audit Findings Related to
Cash & In-Kind Match
See Handout
Corporation Grantee Financial Accountability Seminar July 2007
Summing it up: In a Nutshell Source Documentation: Familiarize all staff with cash and in-kind
match documentation requirements Ensure supporting documentation relates
directly to approved program funded by the CNCS grant
Establish documentation for expenditure requirements to ensure costs are: reasonable, necessary, allocable, allowable, and adhere to grant guidelines
Maintain proper records and establish a written record retention policy
Questions
Electronic copies of this material can be found at The Resource Center
http://nationalserviceresources.org/
Search for Financial Accountability Seminar
Corporation Grantee Financial Accountability Seminar July 2007
!! PARTICIPANT NOTICES !!
CERTIFICATES FOR TRAINING: All participants who attend and complete three or more sessions of the Financial Accountability Seminars can pick up a certificate of participation Sunday afternoon, Monday or Tuesday morning.
CFO – OIG – OGM SUNDAY CLOSING PLENARY: Please attend the Plenary Session [Sunday 3:15 –Salon G] with Jerry Bridges, Carol Bates and Peg Rosenberry to hear about OIG audit plans, address issues that arose during the day and learn about upcoming changes in grants policy.
RESOURCE TABLE: Please take advantage of this opportunity to meet with and discuss your questions and concerns with our experts who include presenters and a special guest from the Division of Payment Management at HHS.