Federal Fiscal Monitoring�VASBO�February 13, 2015��

Review Federal Fiscal Monitoring Process

Schoolwide Programs – Accounting

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Cassandra Ryan 802-479-8545 Erin Finneran 802-479-1032 cassandra.ryan@state.vt.us erin.finneran@state.vt.us

Why Does VTAOE monitor?

• The Vermont Agency of Education is required to monitor our federal grant sub-recipients.

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• VTAOE’s approved procedures include monitoring our federal grant subrecipients at least once every 4 year.

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• There are two ways your organization may qualify for fiscal monitoring

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Risk Analysis

• Annually, VT AOE performs a risk analysis to determine a monitoring list for that fiscal year that contains roughly ¼ of our subrecipients.
• Risk analysis uses weighted categories to determine risk of each subrecipient
• Years since last monitoring
• Total Federal grant dollars expended in the previous fiscal year
• Change over in key office personnel
• Number of A-133 Audit findings

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Special Monitoring

• On occasion we may receive information, an inquiry or request that we determine sufficient cause to monitor an entity that does not otherwise trigger on our risk analysis.
• This does not happen often.

First Steps

• If your organization is chosen for a fiscal monitoring visit the Superintendent and Finance Director/Business Manager will receive an email notification a date and list of which grants will be covered.
• Visits are scheduled for one day, but that day may be long. If we are not finished we will return the next business day.
• We consider the business office our point of contact, but please confirm the date with all interested and required parties within your office to make sure everyone that needs to be available has the date on their calendar.

Who is Required at the Visit?

• Finance Dir./Business Manager - REQUIRED
• Grant Managers for ALL grants being monitored - REQUIRED
• Accounting staff - As appropriate
• Superintendent is always welcome, but not required.

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2^nd Notification – More visit info…

• 2-3 weeks prior to your monitoring visit you will receive an email providing further details about the visit
• This email identifies items we will need
• In advance of the visit (due date will be provided)
• On the day of our visit

�Items needed in advance of our visit�Required Procedures / Policies�

1. Conflict of Interest
2. Travel
3. Procurement
4. Equipment/Capitalization

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Items needed in advance of our visit�Expenditure Detail

• Expenditure detail printouts for each of the grants being monitored.
• For CFP grants please make sure to also include the separate expenditure detail for Schoolwide (SWP) and Consolidated Administration (Con. Admin.)

Items needed in advance of our visit�Schoolwide Plans

• We will also need you to provide us with current Schoolwide Plans for each of your Schoolwide Schools.
• Please make sure the plan includes Schoolwide in the title and includes the current fiscal year.
• If you incorporate your SWP into Green Mtn. Star system please also provide the “crosswalk document” – CFP coordinator

Items needed the day of our visit�Inventory / Subgrants/ Stipends

• Copy of your equipment inventory showing fields of information you are maintaining, plus evidence of latest physical inventory
• Copies of subgrants if required.
• Copies of all grant related stipend agreements

Items needed the day of our visit�

• Copies of the most recent AOE 2.0 and the back up accounting documentation for each of the grants being monitored

Please make sure these are photocopies as we will need to keep these.

• Listing of all employees paid in full or in part with federal grant dollars for grants being monitored during this visit.
• Time and effort documentation for current fiscal year for all employees listed.

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�Monitoring Visit Day – A.M.�We will meet with all attendees to discuss:�

• Accounting System/Internal Controls: budgets entered, encumbrances – journal entry process/approval
• Purchase Order System: Process, authorization levels
• Reimbursements: Process, forms, rates, approvals.
• Procurement Process: documentation
• Contracts: Authorized signers, process for payment
• Program Income: Spent before federal draw?
• Consolidated Accounts: Accounting system, Subgrants?
• Supplanting:
• Required Policies: Available to staff and meet fed/state regs.
• Inventory: Review inventory,
• Time and Effort Documentation: review PARS vs Periodic Certification – make sure T&E on file for all stipends!!

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Monitoring Visit Day – P.M.

• We will spend the afternoon sampling expenditures.
• We will need the complete expenditure packet including (as applicable):
• Check stub
• PO / approval forms as required by your policies
• Contracts: include necessary elements and must be signed and dated by both parties in advance of the work.
• Procurement documentation
• Packing slips
• Proof of attendance and agenda for PD related expenses

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Expenditure Review �We will look to make sure each expenditure is:

• Allowable under the Federal cost principles
• Obligated within grant period. No entertainment, alcohol, lobbying, donations, sales tax, gift cards, etc.
• Approved in the grant award
• Reasonable, Necessary, and Allocable
• Proper back-up documentation is on file

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Exit Interview

• During the course of the day we will keep you informed of our work. Issues can be either:
• Guidance: Best practices, but not necessarily to the level of a finding
• Finding: Issue must be resolved in a Corrective Action Plan (CAP)
• Questioned Cost: We need to speak to Grant Program Leaders at VTAOE or we need more information from you to finish the visit.
• Disallowed Costs: Costs not allowed to be charged to the federal grant: May be unallowable by cost principles, not approved in grant award, obligated outside grant period, improperly backed up, etc.

After the visit �Monitoring Report / Corrective Action Plan (CAP)

• We will mail a report detailing the visit to the Superintendent and Business Manager
• Report will list guidance, findings or disallowed costs.
• Corrective Action Plan Template for you to respond to the findings and disallowed costs. CAP will require evidence the findings have been corrected and that disallowed costs have been recoded to a non-federal source of funds.

Corrective Action Plan

• You have 30 days to submit your corrective action plan and required exhibits
• You will list the action taken, position responsible, and effective date.
• CAPs must be signed by Superintendent and Business Manager

Follow – Up

• During the Fall of the next fiscal year the VT AOE may choose to make an appointment with your office to verify corrective actions are fully implemented as per the approved plan.

Consolidated Funds� Accounting

• Consolidated funds include:

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• Consolidated Administration (Con. Admin.)
• Schoolwide Program (SWP)
• Rural Education Achievement Program (REAP)

Consolidated Funds

• Allow for flexibility on the program side
• Single Cost Objective for time and effort
• Require business office to set up consolidated accounts that feel like an “extra layer” of accounting.

Accounting Structure

• Must allow the contributing funds to lose their identity/restrictions

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• Must provide detail to support grant funds were spent on allowable expenditures

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• Must be able to report back to the VT AOE under the contributing title(s) i.e. Title I and Title IIA

Why isn’t there a template to follow?

• We have SUs with districts and SDs representing a single district.
• Each SU/SD can chose to participate or not participate in the various consolidated funds.
• Employment contract differences:
• Some staff paid at SU level
• Some staff paid at District level
• Some at both SU and District level
• Each SU/SD spends their CFP grant funds very differently

Consolidated Administration

Report back to the VT AOE on AOE 2.0 as �Title I and Title IIA

Quarterly transfer funds on a prorated % basis from both Title I and Title IIA to cover eligible expenditures .

Report back to the VT AOE on AOE 2.0 as �Title I and Title IIA

Now Let’s Add SWP

Set up an SWP account at the SU/SD level

Add individual codes for each SWP school

SD’s and SU’s with building based expenditures hitting at the SU level �ex: SWP staff employed by the SU

Subgrants - SUs

• For SWP expenditures that take place at the district level, the SU and the district must enter into a subgrant agreement.
• Subgrant agreement must detail the amount, allowable costs, reporting requirements, and federal assurances.
• Subgrant agreements must be signed and dated by both parties in advance of obligations.
• SU is required to monitor their subgrantees
• Subgrant agreements will not include the SWP dollars paid out at the SU level

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Subgrant district level expenditures �to the districts

Create SWP accounts at the District level(s).�Direct charge district level SWP expenditures to these SWP accounts.

Quarterly transfer funds on a prorated % basis from Title I and/or Title IIA to cover eligible expenditures.