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Monitoring may include periodic contractor reporting to the Department, Department review of
<br /> audit reports, invoice reviews, onsite reviews and observations, and surveys. Adequate
<br /> documentation is essential for effective contract monitoring and will include copies of letters,
<br /> meeting notes, and records of phone conversations as evidence that conscientious monitoring
<br /> has occurred during the period of the contract.
<br /> c. The Department and the Contractor acknowledge and agree to the following:
<br /> 1) The Department as the pass-through entity (recipient) shall monitor its subrecipients.
<br /> If the Department subawards federal funds to a subrecipient, then the Department
<br /> staff must monitor the subrecipient.
<br /> 2) Review of the A-133 Single Audit report is a primary monitoring activity used by pass-
<br /> through entities to ensure compliance.
<br /> 3) Subrecipient monitoring will occur throughout the year rather than relying solely on a
<br /> once-a-year audit.
<br /> 4) The Department as the pass-through entity (recipient) will conduct on-site visits as
<br /> appropriate and required by contract for "for-profit" subrecipients, since the A-133
<br /> Single Audit does not apply to "for-profit" organizations.
<br /> 3. RECORDS, MONITORING AND AUDIT ACCESS
<br /> a. The Contractor shall cooperate with and freely participate in any monitoring or evaluation
<br /> activities conducted by the Department that are pertinent to the intent of this contract.
<br /> b. The Contractor shall maintain books, records, documents, and other evidence and accounting
<br /> procedures and practices that sufficiently and properly reflect all direct and indirect costs of any
<br /> nature expended in the performance of this contract. These records shall be subject at all
<br /> reasonable times to inspection, review, or audit by personnel duly authorized by the
<br /> Department, the Office of the State Auditor, and federal officials so authorized by law, rule,
<br /> regulation, or contract. The Contractor will retain all books, records, documents, and other
<br /> materials relevant to this contract for six (6) years from the end date of the grant through which
<br /> this contract is funded and make them available for inspection by persons authorized under this
<br /> provision.
<br /> c. The Department or the State Auditor or any of their representatives and federal officials so
<br /> authorized by law, rule, regulation, or contract shall have full access to and the right to examine
<br /> during normal business hours and as often as the Department or the State Auditor may deem
<br /> necessary, all of the Contractor's records with respect to all matters covered in this contract.
<br /> Such representatives shall be permitted to audit, examine, and make excerpts or transcripts
<br /> from such records and to make audits of all contracts, invoices, materials, payrolls, and records
<br /> of matters covered by this contract. Such rights last for six (6) years from the end date of the
<br /> grant through which this contract is funded.
<br /> d. If any litigation, claim, or audit is started before the expiration of the six (6) year period, the
<br /> records shall be retained until all litigation, claims, or audit findings involving the records have
<br /> been resolved.
<br /> 4. SINGLE AUDIT ACT REQUIREMENTS (INCLUDING ALL AMENDMENTS)
<br /> Non-federal entities as subrecipients that expend $500,000 or more in one fiscal year of federal funds
<br /> from all sources, direct and indirect, are required to have a single or a program-specific audit conducted
<br /> in accordance with the Office of Management and Budget (OMB) Circular A-133-Audits of States, Local
<br /> Governments, and Non-Profit Organizations (revised June 27, 2003, effective for fiscal years ending
<br /> after December 31, 2003). Non-federal entities that spend less than $500,000 a year in federal awards
<br /> are exempt from federal audit requirements for that year, except as noted in Circular No. A-133.
<br /> Circular A-133 is available on the OMB Home Page at http://www.omb.gov and then select "Grants
<br /> Management"followed by "Circulars".
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