At Broadband Application Training workshops across the nation, government representatives have stated that compliance monitoring and reporting would play a crucial role in setting a standard of transparency and accountability to funding applicants.

It was made very clear that the government is taking this issue very seriously.

In short, a compliant program will meet the deadlines stated in its application and use money as indicated. During the second review of proposals at the end of September, a separate compliance team will begin checking proposals for compliance issues. Program Officers have already been hired and placed in the field to monitor and provide oversight for specific programs.

What will I need to report?

According to the Office of Management and Budget’s guidance document, recipient reporting required by Section 1512 of the American Recovery and Reinvestment Act (ARRA) will answer these questions:

• Who is receiving funding and in what amounts?
• What projects or activities are being funded?
• What is the completion status of these projects and activities?
• What impact have projects and activities had on job creation and retention?

Prime recipients are required to provide quarterly reports, which will be published publicly. Reports should contain the total amount of funding received, how much has been spent on projects and activities to date, a list of projects including answers to the final two questions stated above and details on sub-awards and other payments.

Broadband Initiatives Program (BIP) and Broadband Technologies Opportunity Program (BTOP) recipients must also report information on a quarterly basis, though required information varies depending on the project type. Consult the stimulus workshop workshop’s compliance presentation for more information on the specific requirements for Infrastructure, Public Computer Center and Sustainable Broadband Adoption reporting.

To make compliance less cumbersome, the federal government is developing an online recipient reporting tool, which is expected to be available for reports due at the beginning of October, at www.FederalReporting.gov. Also, check out the U.S. Department of Commerce’s ARRA Award Terms guide, which provides more general detail about compliance issues.

What will happen if my program is not compliant?

According to BroadbandUSA, the penalties for non-compliance are many. Some of the major penalties include:

• Suspension of payments or the entire award itself
• Termination for cause or convenience
• Debarment and suspension
• Deobligation

Compliance issues are going to play a major role in determining whether projects receive requested funding or not. The federal government is obviously emphasizing the need for transparency and accountability and has made it clear there is a clear commitment to reporting requirements.

When looking at your program, ask yourself these questions: Have I built a sustainable model that will last well after the funding ceased in two or three years? Is it already in place?

What will be covered during an audit?

According to officials, there will be eight major administrative and compliance areas covered in a program audit. They include:

• Financial management systems
• Matching funds/In-kind contributions
• Scope/Budget revisions
• Procurement practices
• Property management
• Subrecipient monitoring
• Financial/Performance reporting practices
• Program income

In addition, a cost audit will be performed and will look at items such as salary distribution, fringe benefits, travel and entertainment costs, contributions and gifts, indirect costs and cost allocation plans, equipment and contracts and sub-awards.

During a presentation on auditing practices, officials presented this example of a cost audit finding: A program manager is working an average of 40 hours a week on a federal grant and 20 hours a week on other projects. The manager’s entire salary is being charged to the grant. The auditor questions one-third of the salary cost. The issues include documentation and valuation.

Keep in mind that non-federal entities (excluding for-profit organizations) are required by the Single Audit Act of 1996 to undergo an annual audit of federal awards. So how do you ensure your organization avoids audit findings?

More than half the battle is won by establishing a solid system of review and documentation. Ensure your proposal is thorough and fact-based, and that you read and understand the award and what will be required before signing. Make sure all staff members understand these requirements as well and that a through review of financial, administrative and project management systems has taken place.

In addition, be sure to document everything. The more thorough your record-keeping, the easier it will be for you to cooperate during the audit and resolution process with full and timely reports.

When in doubt, always ask questions – especially before acting. Make sure you know your agency or department contacts.

The documentation is out there to guide you through the proper steps. Be sure to follow it. If you have questions, play close attention to updates on BroadbandUSA or e-mail us at info@knightcenter.org.