2016 Q3 ISSUE COSTTREE CAPTURE. 31
compliant
non-compliant
complying agency
regulating body
These are just some of the benefits and costs of compliance. This is a step in the right direction; however, there is more that can be done to increase efficiency and make compliance more attainable—and that is uniform reporting. Once we can move agencies toward uniform reporting, the cost of compliance is drastically reduced.
Hiring new employees: Increased reporting will take additional staff time and may require more employees
Employee training: Employees must familiarize themselves with the guidelines and be trained on reporting criteria; new processes must be implemented and documented for data collection and retention
New software for reporting: New software systems designed to comply with the 2 CFR Part 200 will reduce preparation time and help expedite audits
Opportunity of reimbursement not available before—by going through, you might see additional opportunities available to you
Additional auditors must be hired: With stricter guidelines, more agencies will be audited and the audits will be more in-depth
Work toward streamlined information for efficient audit process
Employee training: Auditors must be trained on the new criteria of the Guidance
Expensive, third-party consulting support needed to navigate an ever-changing audit process
Reduced reimbursement for projects and services
Difficulty in accurately budgeting and planning for future projects, due to unknown funding amounts
If the agency does not prepare a cost allocation plan and ICRP, some projects and funding streams will be out of reach
Longer audit process and staff time resulting in diminishing returns
Fraudulent or improper payments:
Without compliance, a funding agency may over-pay for unallowed costs that are accidently submitted or for reimbursement fraudulently requested
Lengthy and inconsistent audit process:
With inconsistently applied criteria, agencies will be unclear as to what to submit, each audit will be different, and there will almost always be findings and challenges—without compliance, the funded agencies do not know what to expect in the audit, and they will not be able to develop the consistency of submissions needed for a quick audit review
Project delays and delayed payments to awardees may result from lengthy audits: Awardees may choose to look elsewhere for funds or not provide services, as reimbursement will be unknown and the agency may not be appropriately paid