In an attempt to remove influence or bias on competitive grants, federal agencies are now required to post notices of all grant opportunities online. Applying for a new grant is simplified, as the federal government has moved toward a more uniform application (guidance for the application process can be found in Subpart C). Federal awarding agencies are also prohibited from imposing additional or inconsistent requirements with some exceptions and can only apply more restrictive requirements to a class of federal awards or non-federal entities when approved by the OMB and required by federal statutes or regulations. On a case-by-case basis, certain compliance requirements may be waived.
Subpart A is intended to simplify interpretations of any language found throughout. Financial management requirements, included in Subpart D, provide for more detailed records be kept to identify the source of the federal award and application of the funds. Non-federal entities are required to establish and maintain effective internal control over the federal award and these internal controls should be in compliance with guidance in the Green Book issued by the Comptroller General of the United States and the “Internal Control Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
Subpart E requires specific support of personnel costs, such as existence of employees, reasonableness of compensation, and assignment and allocation of federal awards, with changes primarily in the area of assignment and allocation of salaries to federal awards. Direct recipients of federal awards, as well as sub-recipients, should familiarize themselves with new standards for documentation of compensation. Budgets alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes provided certain criteria is met. This subpart also requires pass-through entities to provide an indirect cost rate to sub-recipients. Federal agencies and pass through entities will have to accept a non-federal entity’s negotiated indirect cost rate, unless a statute or regulation allows for an exception.
New single audit requirements detailed in Subpart F will be effective for years ended December 31, 2015, and beyond. This section raises the threshold for single audits of entities that expends federal award money from $500,000 to $750,000 per fiscal year. The Government Accountability Office (GAO) estimates that, as a result of the higher threshold, approximately 5,000 non-federal entities will be relieved of the single audit requirement.
All direct recipients and sub-recipients of federal awards should become adept in the new requirements of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards and keep this document handy for quick reference.
The 103-page document detailing the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards can be found here
Notices of all grant opportunities are required to be posted at www.grants.gov
. The Green Book can be found at www.grants.gov
and COSO guidance on internal controls can be found at www.coso.org/guidance
For more information on how these changes may affect you or your organization, please contact Adam Reiss at 212.697.1000 or firstname.lastname@example.org or Kevin Ryan at 215-545-4800 or email@example.com.