The Fiscal Monitoring Unit is responsible for monitoring all grants that are processed through GME. The main objective of the Fiscal Monitoring Unit is to ensure entities are compliant with federal and state guidelines. The team’s mission is to curb any fiscal roadblocks, shed light on federal and state compliance guidelines, and overall enhance the grant experience. We do this by conducting Fiscal Monitoring Audits and examining Single Audits.
Fiscal Monitoring Audit:
A Fiscal Monitoring Audit is a process whereby the financial and business management aspects of a grant are reviewed and evaluated by collecting and analyzing information from several different sources. The monitoring process tests five different compliance categories:
The Arizona Department of Education (ADE) serves as the pass-through entity and fiscal/cognizant agency for several different grants.
Within the Grants Management, the Fiscal Monitoring Unit is charged with performing periodic fiscal reviews for all education agencies within the State of Arizona that receive grant awards passed through ADE. The unit's goals are to ensure the education agencies use sound management practices as public stewards of federal funds, assist the agencies to meet compliance with federal program requirements and federal grant guidelines and to provide assistance to the agencies as necessary.
Pursuant to 2 CFR §200.331, as a Federal grant pass-through agency, ADE is responsible for monitoring the activities of subrecipients to ensure the subaward is used for authorized purposes, in compliance with federal and state statutes, regulations, and the terms and conditions of the subaward.
The Federal Uniform Administrative Requirements mandate ADE monitor subrecipients. Monitoring includes:
Review of detailed expenditure reports provided by the subrecipient
Follow-up to ensure timely and appropriate actions by subrecipients with deficiencies pertaining to the federal award, as detected through audits, on-site reviews, and other means
Issue audit findings pertaining to grant awards
Depending on ADE’s assessment of compliance and/or risk, providing subrecipients with training and technical assistance
ADE’s fiscal monitoring review focuses on four main areas of compliance:
Grant Expenditures – Payroll & Non-Payroll
Review of Expenditures and Cash Management: Monitoring/audit ensures cash management/flow correlates with expenditure documentation and that all expenditures are accounted for.
Time and Effort
Time & Effort Reporting: Monitoring ensures there is an adequate level of Time and Effort documentation for all salaries paid whole or in-part by grant funds.
Fixed Assets: Monitoring includes a review of assets purchased using grant funds.
Grants Management & Internal Control
Administrative and Financial Record keeping: Monitoring ensures there is a solid internal control system in place.
Adherence to Reporting Guidelines: Monitoring reviews timeliness of financial reporting.
Pursuant to 2 CFR §200.331(a)(3), ADE selects an entity for fiscal review based on the Risk Assessment issued by Grants Management.
A Grants Management Fiscal Monitoring Auditor will be in contact by phone to notify the organization of its monitoring selection. The Fiscal Monitoring Auditor will assign a LEA Fiscal Monitoring Update role to the person or persons who the entity has selected to oversee the monitoring. The monitoring will be conducted in GME and the Fiscal Monitoring Auditor will walk the assigned user through our Fiscal Monitoring Process.
Fiscal Monitoring will review the entity's most recent completed fiscal year. The period to be covered by the Grant Accounting Expenditure Report will be the project period plus the 90 day adjustment period.
A Fiscal Monitoring Review takes approximately one month to complete. Both the entity and ADE share the responsibility of meeting all deadlines.
To ensure the Fiscal Monitoring Review is completed within the minimum time required, the LEA should provide all documentation requested by the deadline date specified by Fiscal Monitoring Auditor.
Lack of documentation or inadequate documentation may result in an audit finding of non-compliance, which could result in disallowed expenditures that must be paid back to ADE. It may also lead to an LEA being place on hold for non-compliance under 2 CFR §200.207.
Following an on-site review, ADE will complete a Final Determination Letter that details any findings (which are also discussed during the Exit Conference). A Corrective Action Plan (CAP) may need to be developed to address the audit findings. Failure to fulfill any component of the CAP as approved may result in additional consequences including discontinuance of funding.
There is a guide in the GME Resource Library for entities to follow regarding Time & Effort. To access said document, click here.
A Fiscal Monitoring Non-Compliance Hold will mimic a global hold which will suspend an LEA’s or entity’s ability to receive funding.
This type of Hold is placed:
On all grants for specific years
If any deadlines are not met
If responses are not timely
For other miscellaneous reasons
Please Note: A Global Hold is removed once the issue or concern has been resolved.