1. Financial Grants Management 101
September 5, 2018
Financial Grants Management 101

3. Chad Aleshire Program Analyst / Team Lead Office of Apprenticeship Employment and Training Administration

4. Deborah Strama Fiscal Policy Team Lead Division of Policy Review and Resolution Office of Grants Management

5. Polling Question #1 What is your role in the ETA 9130 reporting process?
I collect the data from the accounting system
I coordinate the collection with program staffer who files the report
I certify the information that was submitted into the system
What is an ETA 9130? 

6. Polling Question #2 What criteria do you consider before awarding funds to a local partner or agency to help run the grant?
Past success or performance rates with other Federal grants
Location to the office
Experience with apprenticeship programs
Clean audit opinion
School colors  

7. At the end of the training you will have a better understanding of the following:
How to apply the different financial and grant management requirements applicable to your grant
Standards for Financial and Program Management
Financial Reporting using the ETA-9130
Subrecipient Management and Oversight
Web resources

8. Applicability
2 CFR 200 and 2 CFR Part 2900 may be found at

9. Authorization vs. Appropriation
Authorizing legislation such as WIOA Public Law establishes policies and funding limits for programs and agencies.
Appropriations legislation gives Departments authority to obligate and expend federal funds related to the program authorizations. Appropriations can further restrict the purpose, time, and amount of the program authorizations.
Through the Anti-Deficiency Act, Departments are prohibited from over obligating or overspending an appropriation.

10. Order of Precedence Program authorizations*/statutes.
In the event of any inconsistency between the terms and conditions of this Notice of Award and other requirements, the following order of precedence shall apply:
Program authorizations*/statutes.
Other applicable Federal statutes.
Applicable appropriations** .
Implementing Regulations.
Executive Orders.
OMB Circulars, including the Uniform Guidance at 2 CFR 200 and 2900.
DOL-ETA Directives.
Terms and conditions of this award.
*Authorizing legislation such as WIOA Public Law establishes policies and funding limits for programs and agencies.
** Appropriations legislation gives Departments authority to obligate and expend federal funds related to the program authorizations. Appropriations can further restrict the purpose, time, and amount of the program authorizations. Through the Anti-Deficiency Act, Departments are prohibited from over obligating or overspending an appropriation.
The best way to assure a system that is in compliance with applicable laws and regulations is to ensure that the requirements have been identified and taken into consideration in the development of policies and procedure
To begin, we need to understand the hierarchy of the rules we have to follow.
The Law - Requirements written in the program statute or any other Federal law cannot be superseded by anything below; followed by state law as long as it is not in conflict with Federal requirements.
OMB guidance as codified in the Code of Federal Regulations (CFR)
Other Government-wide rules such as the Drug-Free Workplace and Clean Air Act, and the others shown on the pyramid.
Program regulations, e.g., 20 CFR – WIA – or any other program rules issued by the Federal agency - must comply with the laws above.
Grant Agreement terms and conditions
Beyond these are the Federal Agency’s policies (for example - Training Employment Guidance Letters)

11. DOL Exceptions
The Department of Labor’s (DOL) adoption of the Office of Management and Budget (OMB) Guidance in the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards is found at 2 CFR 2900.
except to the extent that an agency can demonstrate that any conflicting agency requirements are required by statute or regulations, or consistent with longstanding practice and approved by OMB.
22 exceptions were approved for DOL

12. Non-Federal Entity Only applicable to DOL grants
Non-Federal Entity (NFE): Defined in 2 CFR as a State, local government, Indian tribe, institution of higher education (IHE), for-profit entity, foreign public entity, foreign organization or nonprofit organization that carries out a Federal award as a recipient or subrecipient.
Definitions in WIOA align with the Uniform Guidance CFR

13. Pass through entity & subrecipient
Pass-Through Entity (PTE):
a non-Federal entity that provides a subaward to a subrecipient to carry out part of a Federal award. 2 CFR
Subrecipient:
a non-Federal entity that receives a subaward from a pass-through entity to carry out part of a Federal program, but does not include an individual that is a beneficiary of a such program. 2 CFR

14. Standards for Financial and Program Management

15. Standards for Financial and Program Management
Statutory and national policy requirements
Performance measurement
Financial management
Internal controls
Bonds
Payment
Cost sharing or matching
Program income
Revision of budget and program plans
Period of performance.
The sections identified in BOLD have significant changes either as a result of the Uniform Guidance requirements or DOL exceptions.
It is our intention to provide a high level breakdown so that you understand what is new, what has changed, and what has stayed the same. Not all requirements are different and or new.
Read the bold citations from the slide.
We will be covering these requirements in greater detail as we progress, but we wanted to identify those parts of the Guidance that have changes or are additions, as these may impact your implementation as well as your management systems.

16. Financial Management Systems
Must adhere to 7 separate standards
Financial Reporting
Accounting Records
Internal Controls
Budget Controls
Allowable Costs
Source Documentation
Cash Management

17. Standards for Financial and Program Management (2)
Statutory and national policy requirements
All Federal awards must be expended and in compliance with U.S. statutory and public policies
FFATA, salary limits, SAM, whistleblower protection and more
Performance measurement
Require performance metrics/goals to improve program outcomes and use cost effective practices
Additional standards that apply are:
Statutory and national policy requirements. This section requires that all Federal awards must be expended and in compliance with U.S. statutory and public policies, including FFATA (Federal Funding Accountability and Transparency Act), salary limits, SAM, whistleblower protection and more.
Performance measurement. This is a new condition and requires performance metrics/goals to improve program outcomes and the use of cost effective practices to be included in all awards.

18. Standards for Financial and Program Management (3)
Financial systems must provide:
Identification of all Federal cash receipts and expenditures
By CFDA title and number, grant number, year and name of entity awarding the funds
By obligations, unobligated balances, assets, income and interest
Accurate, current, and complete disclosure including accruals
Comparison of expenditures to budgets and performance
Written procedures for payments and allowability of costs
States continue to follow their laws in expending federal awards
For Financial Management standards, States will continue to use and expend the Federal award in accordance with State policies and procedures. However, all systems must be adequate for report preparation and trace funds to a level that establishes such funds are used in compliance with Federal Requirements.
All non-Federal agencies must have financial systems that provide the following:
Identification of all Federal receipts and expenditures-including the Federal program, CFDA number, award identifier and Federal agency and the name of the pass-through agency if any. Parts of these requirements are new.
Accurate, current, and complete disclosure—financial results of each award that are in accordance with financial reporting requirements and monitoring and program performance requirements.
Records that identify source and application of funds—must include information on awards, obligations, assets, expenditures and income. Recipients must have source documentation to support records.
[Continued on next page]

19. Standards for Financial and Program Management (3)
Financial systems must provide:
Identification of all Federal cash receipts and expenditures
By CFDA title and number, grant number, year and name of entity awarding the funds
By obligations, unobligated balances, assets, income and interest
Accurate, current, and complete disclosure including accruals
Comparison of expenditures to budgets and performance
Written procedures for payments and allowability of costs
States continue to follow their laws in expending federal awards
[Continued from previous page]
Effective control over and accountability for funds—safeguard all assets. Recipients must ensure use only for authorized purpose.
Comparison of expenditures to budgets by cost category—for each Federal award. This should be done often enough to ensure compliance. And finally,
Written procedures for payments and allowable costs—sufficient to implement payment requirements and determine allowability of all costs charged to the Federal award. The guidance now specifies that procedures are written and that these standards are components of the required internal control systems.

20. Internal Controls & Payments
Must establish adequate internal controls using sound management practices that may include:
Standards for Internal Control in the Federal Government (Green Book) or “Internal Control – Integrated Framework (COSO)”
Bonds - No change
Payments
Incorporates IPERA improper payments requirements
Remittance of interest income of $500 annually
DOL Exceptions and
Impose restrictions on advances depending on specific conditions
Requires liquidation of existing advances before new request
The requirements for internal control systems are found at 2 CFR The Uniform Guidance moved internal controls from the audit Compliance Supplement to the Administrative Requirements. The lack of proper internal controls is a frequent audit finding and the COFAR determined that moving this requirement to the internal control systems would help to mitigate the risk of waste, fraud and abuse of federal funds.
This section has been substantially updated, and now suggests that internal control systems be in compliance with the Standards for Internal Control in the Federal Government issued by the Comptroller General (also known as the Green Book) and the Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In addition, non-Federal entities must comply with rules and take reasonable precautions to safeguard information. Internal Control requirements are covered in more detail in a separate module.
The requirements for IPERA or the improper payments act have now been incorporated into rules on payments, along with the cash management requirements of previous Circulars. DOL exceptions are found at 2 CFR , which restricts payment of advances to recipients unless specific conditions exist. 2 CFR requires that existing advances be liquidated prior to requesting additional cash.

21. Standards for Financial and Program Management (4)
Cost sharing or matching
Higher standards for documentation
Must be verifiable through adequate records
DOL exceptions requires that contributions/funds received for match purposes must be expended on program purposes.
Program income
Addition method required for ETA grants (Deduction is default in Uniform Guidance)
The next sections of Financial and Program Management requirements cover Match and Program Income. These sections are largely drawn from A Included are clarifications to the valuing of third-party and volunteer services and a new, higher standard for documentation.
ETA has also included a requirement that the addition method be utilized for the reporting of program income. Note that the default in the Uniform Guidance is the deduction method ( ).
There will be a separate modules for Match and Program Income that cover these requirements in more detail.

22. Budget and Program Plans and Period of Performance
Revision of budget and program plans
If Federal award is over the Simplified Acquisition Threshold, prior approval is needed for any cumulative change of 10% of the total budget
2 CFR DOL Exceptions
No blanket approval
Submission 30 days before effective date
Must be writing
Only approving official is the Grant Officer
Period of performance
If Federal award is over the Simplified Acquisition Threshold, prior approval is needed for any cumulative change of 10% of the total budget. The Threshold is currently set at $150,000. This is a change from ETA’s previous line item flexibility.
The budget and program plan revisions have also been adapted primarily from the requirements of A-110 and specify that recipients must report deviations from approved budgets and program plans if the conditions warrant. In addition, there are a number of instances where the prior approval of the awarding Federal agency must be received prior to the actions being taken. Examples include changes in key personnel, the transfer of funds budgeted for participant support costs, among others. There are also clarifications to the approval requirements for budget revisions and a requirement that Federal agencies must take action within 30 days.
In addition, there are a number of exceptions to the guidance approved for the Department of Labor. These are codified at 2 CFR and primarily address prior approval requirements as specified on the screen.
discusses the period of performance for awards with specified beginning and ending dates.
Budget and Program Plan Revisions will be addressed in separate sessions on Grant Modifications and Budget controls.

23. Financial Reporting

24. Financial Reporting Quarterly ETA-9130
2 CFR DOL exception
ETA requires accrual reporting using the ETA-9130
Reports are due 45 calendar days after quarter end
A FINAL 9130 is due 45 calendar days after the end of the grant’s POP (expiration)
A CLOSEOUT 9130 is due 90 calendar days after grant’s expiration
Reporting requirements are address at 2 CFR and cover 3 types of reporting for Federal awards.
The first is financial reporting. OMB has specified that only approved formats may be used by Federal agencies. ETA currently uses an approved format, the ETA-9130, to obtain financial data from recipients. There is a Departmental exception at which specifies that the requirement to report on a cash or accrual basis is at the discretion of the Department of Labor office making the award. Currently, ETA requires all grants to report on an accrued expenditure basis using estimates where necessary. Financial reporting is the subject of a separate training module.
2 CFR addresses requirements and restrictions related to performance reporting. This requires the tracking of performance to achieve program outcome. We will not cover performance reporting in this training event.
And finally, the requirements for the reporting of real property assets is addressed at 2 CFR These requirements detail the rules related to property reports including disposition requirements and reporting. These requirements are more fully addressed in the Facilities and Leases module.

25. Financial reporting website
For line-by-line directions on how to complete quarterly financial reports, please refer to the applicable program/fund stream’s instructions at: cfm
For additional information, you may also refer to TEGL 02-16, Updated ETA-9130 Financial Report, Instructions, and Additional Guidance.

26. Financial Reporting Deadlines

27. ETA-9130 Report

28. Expenditures and Obligations
Accruals
Accruals (according to GAAP): matching principles.
Amount owed for good and/or service received or rendered
Line 10e = Cash outlays + accruals
Obligations
Obligations (2 CFR ): orders placed for property and services, contracts and subawards made, and similar transactions during a given period that require payment by the non-Federal entity during the same or a future period.
Reported on line 10g

29. Accounting Records & Source Documentation
Must demonstrate the ability to maintain records that adequately identify the source and application of funds for approved financial activities aligned with the FOA and grant agreement.
The General Ledger is the official books where all transactions are posted and this information is transferred to ETA’s Quarterly ETA Report.
Source Documentation
Accounting records and payments must be supported by documentation such as actual invoices, canceled checks, time and attendance records, reimbursement to employers for OJT, eligibility for stipends, justification for needs-related payments.

30. Subrecipient Management

31. Subrecipient Monitoring and Management
Subrecipient and Contractor Determination
Subrecipient
Determines eligibility
Responsible for programmatic decision making
Carries out a program for public purpose
Held accountable to same standards as grant recipient
Contractor
Obtains goods and services for use of awardee
Normal business operations and ancillary to Federal program
It is the function and purpose that determines the relationship not the name
[Continued from previous page]
A contractor, on the other hand, simply provides goods and services for the use of the prime awardee, and provides these goods and services as part of their normal business operations. The goods and services are considered ancillary to the Federal program, and while necessary to program operations, are not considered essential to achieving the program outcomes.
The Guidance is also quite clear that it is the relationship that defines the determination. It does not matter if the recipient calls its subawards contracts or grants or awards, but rather whether the activity in the agreement meets the specific criteria. Changes to the procurement requirements impact how these awards are procured.

32. Subrecipient Monitoring and Management
Ensure subawards appropriately identified
Identify financial and performance reporting requirements
Establish a system/platform to ensure timely receipt of financial and performance data.
Specifies required information for each award
Includes Federal Award Identification Number (FAIN) and DUNS numbers
CFDA Number and dollar amount of each
Evaluate risk of non-compliance
Monitor subaward activities
Specified actions
Verify audit coverage as required
All pass-through entities (or PTEs) have additional responsibilities specified in the guidance. They must ensure that subawards are appropriately identified, including the inclusion of specific information in the award document. This includes specifying the unique entity identifier, which in the short term is the DUNS number for each organization, and listing the dollar amount of each award by CFDA number. If there are multiple sources of funds, all CFDA numbers and amounts must be clearly identified.
Pass-through entities must also evaluate the risk for non-compliance by each subrecipient and impose specific conditions to ensure compliance if warranted. If required, they must also verify that audit coverage has been obtained.
Pass-through entities must also honor the organization’s current indirect cost rates, negotiate a rate in accordance with guidelines, or provide the minimum flat rate known as the “de minimis rate”.
Finally, the section adds specific subrecipient monitoring tools that were in the audit Compliance Supplement. They incorporate and combine subrecipient monitoring guidance.

33. Selection of Subrecipients
Evaluate risk of non-compliance when awarding to a subrecipient (2 CFR (b)):I
Prior experience with same or similar activities
Past Performance
New personnel or new systems
Results of Federal agency
Monitoring and results of previous audits
Other factors to consider: qualifications of staff, timeliness and accuracy of past reports.
Selecting a responsible subrecipient(s) will mitigate potential risk of non-compliance.

34. Criteria and Tools
To help in selecting the right subrecipient, suggest looking at: Tool S: Risk Assessment Worksheet Core Monitoring Guide /pdf/2018_Core_Monitoring_G uide.pdf

35. Oversight and Monitoring
Grantee’s responsibilities of subrecipients
2 CFR (d) – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved.

36. Subrecipient Management
IF THEY FAIL, YOU FAIL
No entity receives a “pass” on accountability.
Funds to subrecipients are provided to meet the pass-through entity’s program and performance objectives.
Pass-through entity is as accountable as if it were providing the service itself.

37. SUMMARY How can staff help in effectively managing the SAE grant?
Share & Coordinate
Share statement of work with project manager and subrecipients. Coordinate collection and submission of program and fiscal reports between program and fiscal staff
Periodic status checks
Provide regular updates to program staff on meeting performance goals, budgets, modifications, deadlines, and cost allocation processes
Establish an open line of communication
Maintain an open dialogue with FPO

38. Need More Training? WORKFORCE GPS.org
Communities
Grants Application and Management
Uniform Guidance training modules such as:
Financial Reporting
Subrecipient management and oversight
Indirect cost rates
Policies and Procedures
Procurement and Performance Based Contracts
Capital assets and more

40. Deborah Strama Strama.deborah@dol.gov