Financial Management Stacey Jones, Resolution Specialist OGCM- Division of Policy, Review and Resolution Young Offender Grants New Grantee Orientation November 4-5, 2009

How Feds View Themselves

How Grantees View Feds

The NEW DOL Grantee Our Expectations of You: A program that is designed to focus on customer needs and to address those needs A program that meets the requirements of Federal law and regulation A program in compliance with OMB requirements and Generally Accepted Accounting Principles.

The NEW DOL Grantee What you can expect from us: Assistance with regulations On site technical assistance and monitoring Assistance with fiscal and programmatic issues

The Fiscal Program Divide There is a need for program operators to be aware of financial requirements There is a need for fiscal people to be aware of program requirements No one gets to opt out

It’s All Very Simple Written Policies and Sound Business Practices Followed Consistently Over Time With Each Funding Stream Treated Equally, With All Costs Being Necessary and Reasonable Would be done similarly by a Prudent Person Ensuring Proportional Share and Benefits Received

Rules affecting programs WIA regulations Administrative cost 20 CFR Uniform administrative requirements 29 CFR Parts 95 and 97 Grant management rules Cost principles Determine allowable costs

Uniform Administrative Requirements OMB Circulars A-102 & A-110 Codified for DOL grant programs 29 CFR Part 97 State, local and Indian tribal governments 29 CFR Part 95 Everybody else Slight differences Follow DOL rules

All Financial Systems Must adhere to 7 separate standards 1. Financial reporting System must permit preparation of Federal financial reports Must report accruals 2. Accounting records Adequately identify grant funds Awards, obligations, assets, liabilities, income and expenditures Supported by source documentation Must be maintained in accordance with GAAP

Financial Standards 3. Internal controls System to protect integrity of funds Accountability for cash, property & other assets 4. Budget controls Comparison of actual expenditures (outlays) to approved budget plan Compliance with line item requirements Prevents overspending

More Financial Standards 5. Allowable costs Only allowable costs charged Only allocable costs charged 6. Source documentation Costs must trace to authorizing document Proof that costs are allowable & allocable 7. Cash management System to control cash assets

Cost principles Set of government wide rules Cost principles Define conditions for charging costs Types of Costs Allowable Unallowable Allowable with conditions (Prior Approval) If Cost not Treated- Principles of necessary and reasonable apply

OMB Circulars (Cost Principles) A-87 Governments (State, Local, Indian Tribal) A-122 Non-profit organizations A-21 Institutions of Higher Education 48 CFR Part 31 Commercial organizations Handout

Factors Affecting Allowability of Costs Authorized or not prohibited Consistent with the Federal rules & Circulars Consistent treatment Conform to limitations/exclusions contained in the cost principles Documented Consistent with GAAP

Allowable Grant Costs Based on grant program and Statement of Work: Curriculum Development Participant Support Services Case Manager Mentoring Program Provider GED classes Employment Specialist

Allowable Costs with Approval Conditions Equipment Computer Networks Vehicles If prior approval requirement exists BEFORE incurring cost Must be requested in writing Must be approved Approval requests to Grant Officer

Unallowable Costs Pre-award costs Participant stipends Monthly pizza parties for participants Interest, fines & penalties Contingency reserves Real property purchase/construction Exception: ADA Compliance

Unallowable Alcoholic beverages Lobbying Legal expenses for prosecution of claims, ALJ audit appeals or civil actions Entertainment Be careful with employee morale costs.

Prohibited Activities Employment generating Specific exceptions Public service employment Allowable with conditions under some programs Business relocation Sectarian activities Equal Treatment in DOL programs for Faith-based and Community Organizations

PL Applies to All ETA appropriated funds All grants, contract and interagency agreements All funds available on June 15, 2006 Limits salary and bonus payments to individuals Implementation guidance in TEGL limit is $172,200

Who is covered? Individuals paid by ETA appropriated funds Direct recipients and all subrecipients Direct costs or through an Indirect Cost Rate Vendors are not subject to limitation

Administrative Costs 20 CFR (a) Not related to direct services Either to clients or employers List of specific functions Unlike traditional definitions 10% limitation Based on grant award amount Handout

Indirect Costs Costs through an approved Indirect Cost Rate or Cost Allocation Plan Included on the SF-424A Reported on the ETA-9130 May be both Administrative & Program costs WIA definition applies

Leveraged Resources Recipient share of costs Non-Federal funds used for grant purposes Reported on line 10k on the ETA 9130 Other Federal Funds Federal Funds available for the project Reported on line 11a on the ETA 9130 Handout

Financial Reports ETA 9130 Electronic reporting system Use of passwords and pins Quarterly reports Cumulative from beginning of project Accrual basis Due 45 days after quarter end Final and Closeout Reports Handout

Financial Reports Keep in mind— Accrual basis of reporting Administrative costs Breakout on line 10.f Leveraged resources Non-Federal resources expended Lines 10.k-m Federal resources expended Line 11.a

Reporting Contacts Initial Contact – Federal Project Officer On-Line Reporting System - Password and PIN -Shantay Logan – -Avery Malone –

Additional Resources Financial Management Training Tutorial Workforce 3 One Website ( Tutorial Titles: Introduction to Grant Application Forms (SF 424 and SF424A) Introduction to Procurement Requirements Financial Management Principles Introduction to Financial Reporting (ETA -9130)

Questions?