>> WELCOME AGAIN TO THE U.S. GOVERNMENT GRANTS.GOV QUARTERLY STAKEHOLDER WEBCAST. I'M THE ACTING GRANTS.GOV PROGRAM MANAGER. THANK YOU FOR JOINING US. WE HOPE YOU FIND THE DISCUSSION DURING THIS WEBCAST INFORMATIVE AND WE INVITE YOU TO SUBMIT QUESTIONS DURING THIS WEBCAST. FIRST ON THE AGENDA IS THE INTRODUCTION OF TODAY'S WEBCAST PARTICIPANTS FOLLOWED BY GRANTS.GOV STATUS UPDATE AND DISCUSSION OF RECENT AND UPCOMING SYSTEM ENHANCEMENTS. WE WILL FOLLOW THE STATUS UPDATE FOR THE SPECIAL PRESENTATION ON GRANTS FRAUD PREVENTION HIGHLIGHTING THREE AREAS OF INTEREST TO OUR STAKEHOLDERS. FIRST CONFLICTS OF INTEREST. SECOND, MISUSE OF FUNDS, AND THIRD, EMBEZZLEMENT. LASTLY, BUT MOST IMPORTANTLY, WE WILL ASK QUESTIONS THAT YOU HAVE SUBMITTED DURING THIS WEBCAST. OUR E-MAIL ADDRESS IS GRANTS.GOV-WEBCAST @HHS.GOV. I WOULD LIKE TO INVITE YOU TO E-MAIL QUESTIONS TO US DURING THIS WEBCAST. AGAIN, THE ADDRESS IS GRANTS.GOV-WEBCAST @HHS.GOV. AFTER THIS WEBCAST IS COMPLETED, WE WILL COMPILE ALL QUESTIONS THAT HAVE COME IN AND PLACED THEM ALONG WITH THE ANSWERS ON THE GRANTS.GOV WEB SITE. NOW LET'S GET STARTED. JOINING ME TODAY IN THE STUDIO ARE SPECIAL GUESTS KEN DIFENBACH, WITH THE DEPARTMENT OF JUSTICE OFFICE OF FRAUD PROTECTION OFFICE. THANK YOU. >> THANK YOU. >> AND BRANDON WISE FROM THE DEPARTMENT OF HEALTH AND HUMAN SERVICES, OFFICE OF THE INSPECTOR GENERAL. WELCOME, BRANDON. >> KEN AND BRANDON WILL SPEAK TO US TODAY ABOUT GRANT FRAUD PREVENTION. THEIR DISCUSSION WILL FOCUS ON HOW GRANTEES CAN PREVENT FRAUD RELATED TO THE PROGRAMS BY DISCUSSING ISSUES: FIRST CONFLICTS OF INTEREST, RELATED PARTY TRANSACTIONS, SECOND, THE MISS USE OF FUNDS OR FAIL TOWER PROPERLY TRACK THE USE OF FUNDS AND LASTLY, DIRECT THEFT. AT THIS TIME, I WOULD LIKE TO TAKE A FEW MINUTES TO HIGHLIGHT RECENT AND URCH--UPCOMING GRANTS.GOV SYSTEM ENHANCEMENTS. IMPROVEMENTS WERE MADE TO THE GRANTER ORGANIZATION REPORTING FUNCTION. GRANTERS ARE NOW ABLE TO VIEW E-BIS POINT OF CONTACT INFORMATION WHILE USING THE ORGANIZATION REPORT. AS A REMINDER, IT IS A REQUIREMENT THAT ALL APPLICANTS RENEW THE CCR REGISTRATIONS ANNUALLY AND THIS IS WITH REGUARD TO IMPORTANT NEW CHANGE THAT WILL OCCUR ON AUGUST 9th WHEN THE PMO WILL RELEASE FUNCTIONALITY TO PROVIDE A WEB SERVICE CONNECTION FROM THE CENTRAL CONTRACT TO REGISTRATION SITES TO GRANTS.GOV ALLOWING THE SYSTEM TO VALIDATE WHETHER AN APPLICANT CCR REGISTRATION IS CURRENT. IF AN APPLICANT CCR ACCOUNT HAS EXPIRED. THE APPLICANT WILL RECEIVE AN E-MAIL MESSAGE UPON SUBMISSION EXPLAINING TO THEM THEIR APPLICATION CANNOT BE ACCEPTED UNTIL YOUR ORGANIZATIONS CTR REGISTRATION HAS BEEN RENEWED. THIS E-MAIL WILL CONTAIN A MESSAGE TO THE APPLICATIONSLICANTS, TO CONTACT THE ORGANIZATIONS, E-BUSINESS POINT OF CONTACT. UPON UPON RELEASE OF THE THE AUGUST BILL, AGENCIES WILL BE ABLE TO ADD AGENCIES SPECIFIC NOTES TO SUBMITTED APPLICATIONS. APPLICANTS WILL RECEIVE AGENCY NOTES VIA E-MAIL FOLLOWING THE SUBMISSION OF THEIR APPLICATION. LASTLY, WE'RE ADDING ADDITIONAL FIELDS TO THE GRANTOR APPLICATION REJECTION REPORT. GOING FORWARD, THE REPORT WILL ALSO A STATUS FIELD AND AN E. O. R. STATUS FIELD AS WELL AS A DUNS FIELD. THIS WILL BE ADDED TO THE REPORT. I WOULD LIKE TO TAKE A FEW MINUTES TO UP DATE YOU ON KEY PMO ACTIVITIES IN RELATION TO THE VAST RECOVERY, PERFORMANCE MONITORING AND GRANTS.GOV SYSTEM ENHANCEMENT PRIORITIES. GRANTS.GOV DISASTER RECOVERY CAPABILITIES HAVE BEEN MENTIONED PREVIOUSLY ON THIS WEBCAST. GRANTS.GOV HAS PARTICIPATE INDEED TABLE TOP EXERCISES TO FURTHER EXPLORE THE OPTION OF UTILIZING OUR TEST OR TRAINING ENVIRONMENT AS A BACK UP FOR THE PRODUCTION ENVIRONMENT. THIS WILL BE PLACED IN AN ALTERNATE LOCATION WHICH COULD BE THEN UTILIZED IN CASE OF PRIMARY LOCATION FAILURE. AND WE WILL HAVE AN RECOMMENDATION ON HOW TO PROCEED AND WE HAVE AN ESTIMATED CAST OR SCHEDULE FOR IMPLEMENTING THE DISASTER RECOVERY RECOMMENDATION. WE ANTICIPATE THAT THE PMO WILL HAVE A DISASTER RECOVERY OPTION UP AND FUNCTIONAL BY SEPTEMBER THE SEVENTH OF NEXT YEAR. ANOTHER ISSUE THAT I WOULD LIKE TO BRING TO YOUR ATTENTION IS THE NEW PERFORMANCE MONITORING CAPABILITY THAT WE'RE IMPLEMENTING CURRENTLY. FOG LIGHTS IS A CAST WARE TOOL WE HAVE--SOFTWARE TOOL WE HAVE AND IT MANAGES THE TECHNOLOGY BY INSPECTING THEM AND REPORTING IN REALTIME ON THEIR PERFORMANCE AT VARIOUS LEVELS OF THE THE TECHNOLOGY. WHAT THIS ENABLES US TO DO IS TO PREVENT A DASHBOARD FROM MULTIPLE PERSPECTIVES. THIS ALLOWS US TO PROVIDE A VISUAL PRESENTATION OF PERFORMANCE MEASURES. IT'S IMPORTANT TO NOTE THAT THESE PERFORMANCE MEASURES WERE DECIDED BY OUR TECHNICAL STAFF. THEIR CONTROLLED BY TECHNICAL STAFF AND TELL BE VERY EASY TO EITHER ADD PARAMETERS OR CHANGE PARAMETERS WITHOUT THE INTERVENTIONS OF ANY CONTRACTOR OR DEVELOPER. WE'LL HAVE THE CAPABILITY TO DRILL DOWN SO USER K'S SEE PERFORMANCE MEASURES AT A GLANCE AT WHATEVER LEVEL IS APPROPRIATE. WHEN WE FIRST DEPLOY THIS FEATURE WHICH WE'RE CURRENTLY TESTING IN-HOUSE, WE WOULD PRESENT THIS TO OUR EXECUTIVE BOARD TO GET FEEDBACK FROM THEM AND THEN TO THE USERS, ONE OF THE THINGS WE WOULD BE VERY INTERESTED IN PRIOR TO FINALIZING THE REQUIREMENTS AND PERFORMANCE IS FEEDBACK FROM THE USERS WITH REGUARD TO HOW USEFUL THESE THINGS ARE. WHAT WOULD YOU LIKE TO SEE? HOW WOULD YOU LIKE TO HAVE INFORMATION ON PERFORMANCE PRESENTED TO YOU? OUR GOAL HERE IS TO GIVE YOU THE BESTS INFORMATION IN REALTIME. INFORMATION THAT'S USEFUL TO US AND THAT CAN ANSWER YOUR QUESTIONS WITHOUT YOU HAVING TO PICK UP A TELEPHONE AND CALL THE CONTACTS THERE. WELL, NOW I'D LIKE TO TURN OUR ATTENTION TO OUR GUEST SPEAKERS. KEN DIEFENBACH, AND BRANDON TRIESS. AND I'D LIKE TO ASK A QUESTION, SOME PEOPLE WHO SEEK GOVERNMENT FUNDS MAY BE APPROACHED BY INDIVIDUALS WHO OFFER TO HELP THEM FUNDING BY WRITING GRANT PROPOSALS. ASSISTING THE APPLICATION WAS SELLING LISTS OF AVAILABLE GRANTS, IS THIS A LEGITIMATE PRACTICE? AND THE KEY FOR GRANTEE SYSTEM TO BE COGNIZANT AND WHAT'S ALLOWABLE RELATED TO THE SPECIFIC FUNDING PROGRAM AND THE THE PROCUREMENT PROCESS AND IT'S BY THE CONCULT ANT AND THE KEY TERMS OF THE AGREEMENT INCLUDING PRICE OR FEE STRUCTURE. GRANT WRITING FEES ARE USUALLY NOT AN ALLOWABLE COST AND ONE REASON IS THAT THEY INCUR BEFORE THE AWARD OF THE ACTUAL GRANT AND GRANTEES SHOULD USE DUE EXERCISE OR CARE WHEN DEALING WITH ANYONE WHO PROMISES TO HELP THEM OBTAIN GRANT FUNDING OR ANYONE THAT IMPLIES THAT THE ONLY WAY TO OBLIGATIONS DANE A GRANT IS TO WORK WITH THEM EXCLUSIVELY. NO ONE FROM GRANTS.GOV OR PAYMENT OF AN AGENCY REQUIRES PAYMENT OF A FEE TO APPLY FOR A GRANT AND VIEWERS SHOULD BE CAUTIOUS OF ANY SUCH CLAIMS. >> THANK YOU FOR THAT. LET'S MOVE ON TO TODAY'S TOPIC. LET'S TALK ABOUT GRANTS, FRAUD. >> WELL, THANKS AGAIN BORIS BY HAVING US HERE BY WAY OF BACKGROUND. BRANDON AND I ARE HERE ON BEHALF OF THE FINANCIAL FRAUD ENFORCEMENT TASK FORCE WHICH IS AN ORGANIZATION OF ABOUT OVER 20 FEDERALLENTITIES THAT'S DEDICATED TO INVESTIGATING FINANCIAL PROD ISSUES. WE'RE ALSO HERE ON BEHALF OF THE FEDERAL INFECTORS GENERAL COMMUNITY WHICH PLAYING AN IMPORTANT ROLE IN THE TASK FORCE AND THE MISSION OF THE INSPECTOR GENERAL COMMUNITY IS TO INSURE EFFICIENCY, EFFECTIVENESS AND ECONOMY IN FEDERAL PROGRAMS. WE LOOK FOR FRAUD, WASTE AND ABUSE AND WE TRY TO INSURE THE GOVERNMENT WORKS AS IT SHOULD WORK. BRANDON AND I ARE BOTH EXCITED TO BE HERE TODAY TO TALK TO ABOUT THIS IMPORTANT TOPIC AND DESCRIBE THE SCREAM--SCHEMES BUT MOST IMPORTANTLY WE WANT TO TALK ABOUT THE GRANTEES OUT THERE, THE AUDIENCE CAN PREVENT THIS, BECAUSE IT'S THE MOST IMPORTANT WAY TO DEAL WITH THIS NAND BORIS IN PHIFISCAL YEAR 2010, FEDERAL GOVERNMENT AWARDED 600 BILLION DOLLARS APPROXIMATELY AND OVER 1600 DISTINCT PROGRAMS FOR A VARIETY OF SERVICES. THOSE PROGRAMS ARRANGED FROM HEALTHCARE TO INFRASTRUCTURE TO CRIMINAL JUSTICE, TO RESEARCH, POVERTY, TO EDUCATION, EVEN THE ENVIRONMENT. IT'S IMPORTANT TO NOTE THAT GRANTS TOUCHED THE LIVES OF JUST ABOUT EVERY AMERICAN LIVE NOTHING THE U.S. TODAY OR EVERY RESIDENT IN THE U.S. TODAY AND INCREASINGLY WE ARE STARTING TO SEE OUR GRANTS, THE GRANTS AWADDED BY THE FEDERAL GOVERNMENT, TOUCH THE LIVES FROM PEOPLE AROUND THE WORLD. SO WHEN WE TALK ABOUT GRANT FRAUD, WE HAVE TO ASK, WHAT EXACTLY IS GRANT FRAUD AND IT'S WHEN A GRANTEE MATERIALLY DEVIATES FROM WHAT THEY SAY THEY'LL DO WHEN A--WHEN THEY'RE AWARDED A GRANT AND NOT TO BE TO BLUNT, A GRANT IS A LIE, IT'S AN INTENTIONAL LIE AND IT CAN OCCUR THROUGH CO MISSION, BY SUBMITTING A FALSE DOCUMENT OR BY OMISSION AND ALLOWING THING TO HAPPEN THAT SHOULDN'T HAPPEN TO THE GRANT. SO WHEN WE TALK TO GRANTEES AND APPLICANTS, WE LIKE TO TALK ABOUT WHAT THEY SHOULD DO TO PREVENT, CORRECTLY PREVENT FRAUD AND TO YOU KNOW DETECT FRAUD AS SOON AS POSSIBLE. AND WE THINK THAT THE THE FIRST THING IS EDUCATION. IT'S BEEN VERY IMPORTANT FOR GRANTEES BECAUSE THEY'RE AWARDED THE GRANT, BUT ALSO FOR THE EMPLOYEES, TO KNOW A-THE TERMS AND CONDITIONS OF THE GRANT, WHAT'S EXPECTED OF THE GRANTEE AND WE ALSO THINK IT'S IMPORTANT FOR MEMBERS OF THE PUBLIC AND EVEN THE CLIENTS TO KNOW ABOUT THE GRANT PROCESS AND TO KNOW WHAT EXACTLY FRAUD IS. BECAUSE THE MORE PEOPLE WHO ARE AWARE OF THE DEFINITIONS OF FRAUD, WHAT FRAUD LOOKS LIKE, THE MORE PEOPLE WE BELIEVE WILL BE ABLE TO ASSIST IN PREVENTING FRAUD FROM OCCURRING. >> LTHANK YOU BRANDON THAT WAS VERY INTERESTING ON ONE ACCOUNT ACCOUNTED YOU SPEAK TO ISSUES HERE. >> ABSOLUTELY THE FIRST BIG ISSUE FOR US THAT WE WANT TO GET ON THE TABLE IS CONFLICTS OF INTEREST AND IT'S IMPORTANT FOR GRANTEES TO REMEMBER THAT THE OMB CIRCULARS WHICH ARE NOW IN THE CODE OF FEDERAL REGULATIONS HAVE A DISKRIPGZ AND SOME LANGUAGE THAT RELATES TO CONFLICTS OF INTEREST, BUT IN ADDITION TO THAT, EVERY GRANTING AGENCY CAN ISSUE ADDITIONAL GUIDANCE, ADDITIONAL POLICIES. FOR INSTANCE THE DEPARTMENT OF JUSTICE AND THE NATIONAL SCIENCE FOUNDATION I KNOW ARE TWO AGENCIES THAT GIVE THEIR GRANTEES ADDITIONAL GUIDANCE AND DEVELOPMENTAL ENDOCRINOLOGY FISSIONS AND RULES ABOUT CONFLICTS OF INTEREST SO IT'S IMPORTANT THAT GRANTEES UNDERSTAND WHAT THE PARAMETERS ARE OF THEIR PARTICULAR AGREEMENT. AND ALL WE'RE TALKING ABOUT RELATED TO CONFLICTS OF INTEREST IS RELATED PARTY TRANSACTIONS OR DECISIONS ABOUT HOW TO SPEND MONEY THAT ARE CONFLICT OR COULD BE SEEN AS THE APPEARANCE OF A CONFLICT. SO ANYTIME SOMEONE AT A GRANTEE ORGANIZATION IS MAKING A DECISION ABOUT HOW TO SPEND GRANT FUNDS IN THAT DECISION COULD IMPACT THEIR PERSONAL FINANCIAL LIFE, THE FINANCIAL SITUATION OF A FAMILY MEMBER, OF A BOARD MEMBER IN THE EXAMPLE OF A NONPROFIT OR ANYONE ELSE THAT IS NOT 100% IMPARTIAL AND SEPARATE FROM THE DECISION MAKERS. WE HAVE A QUESTION AS TO WHETHER A CONFLICT OF INTEREST EXISTS OR NOT AND ONE BIG POINT I WANT TO MAKE RELATED TO THIS TOPIC IS THE USE OF CONSULTANTS. YOU ASK ME A QUESTION AT THE BEGINNING OF THIS WEBCAST ABOUT CONSULTANTS AND THAT'S AN AREA THE GRAPTEE HAS TO BE VERY CAREFUL ABOUT BECAUSE OFTEN TIMES CONSULTANTS ARE NOT AS INDEPENDENT AS THEY SHOULD BE IN THE DECISION PROCESS SO ANYTIME A CONSULTANT IS GOING TO USE THAT STAGE, THEY HAVE TO BE CAREFUL ABOUT HOW THAT'S DONE. HOW THEY DOCUMENT THOSE DECISIONS TO INSURE THAT THAT ACTION IS IMPARTIAL IN APPEARANCE AND IN FACT. AND IN THE LAST THING I'LL SAY ABOUT THIS TOPIC, IS THAT NO ONE--VERY FEW OF THESE SITUATIONS ARE BLACK AND WHITE, CLEAR CUT, RIGHT OR WRONG. SO A CONFLICT OF INTEREST QUESTION OFTEN REQUIRES CAREFUL ANALYSIS REVIEW AND MOST IMPORTANTLY COMMUNICATION WITH OTHERS TO SAY, CAN WE DO THIS, HOW DO WE DO THIS. IS THIS APPROPRIATE. AND SO FORTH. AND AS WE DISCUSS THE BEGINNING OF THIS PROGRAM, BRANDON AND I WANT TO EMPHASIZE SOME THINGS THE GRANTEE K'S ALWAYS DO TO HELP PREVENT THESE ISSUES AND CONFLICTS OF INTEREST, THE FIRST ONE THAT COMES TO MIND IS THE GRANTEES CAN AND SHOULD EDUCATE EVERYONE IN THE ORGANIZATION, STAKEHOLDERS VOLUNTEERS, BOARD MEMBERS, COLLEAGUES, EVERY DEPARTMENT IN WHAT THE CONFLICT OR INTEREST PROHIBITIONS ARE RELATED TO A PARTICULAR AGREEMENT. BECAUSE AS BRANDON SAID, THE MORE PEOPLE IN THE ORGANIZATION THAT ARE AWARE OF THE THE RULES, AFTER THE ACCIDENT WARE OF THE THE BOUNDARY LINES AND THE PARAMETERS, THE BETTER CHANCE THE ORGANIZATION HAS OF AVOIDING PROBLEMS OR IDENTIFYING PROBLEMS SOONER RATHER THAN LATER. >> AND ALSO WITH CONFLICTS OF INTEREST, YOU KNOW THERE ARE SITUATIONS WHERE, THINGS, IT'S ABOUT APPEARANCES AND IF HAVE YOU A SITUATION AS A GRANTEE WHERE A GRANTEE BELIEVES THAT THE SITUATION DOESN'T LOOK TO BE AN ARM'S LENGTH TRANSACTION, THAT THE PARTIES AREN'T RELATED, THEY SHOULD DISCUSS THOSE ISSUES WITH THEIR OUTSIDE LEGAL COUNCIL, EVEN THE GRANT PROGRAM OFFICE TO GET A DETERMINATION OR AN OPINION TO SEE WHETHER OR NOT THE CONTRACT THEY'RE ABOUT TO ENTER INTO WITH THE CONSUMMIT APTS THAT KEN MENTIONED IS APPROPRIATE AND IS ABOVE BOARD. >> SO WITH SO MANY PEOPLE INVOLVED IN THE GRANT PROCESS AND THE GRANTEE COMMUNITY, WHAT WOULD BE THE BEST APPROACH TO ACTUALLY MAKING SURE THAT PEOPLE UNDERSTAND HOW TO GO ABOUT THINGS. >> ONE OF THE MOST IMPORTANT COMPONENTS OF ANY ORGANIZATION, GRANT FUNDED OR NOT IS GOOD POLICIES AND PROCEDURES AND ONE AREA PARTICULAR, HEAR IS HAVING A GOOD SOLID PROCUREMENT PROCESS. AND EVERY GRANT FUNDED ORGANIZATION IS REQUIRED TO HAVE A PROCUREMENT PROCESS AND FOLLOW A PROCUREMENT PROCESS. THERE'S NOT A HARD AND FAST PROCESS THAT EVERYONE MUST FOLLOW BUT THEY MUST HAVE ONE WHETHER IT'S A STATE PROCESS, PROCUREMENT PROCESS OR THE FEDERAL PROCUREMENT PROEASES AND THAT'S ONE KEY WAY IF GRANTEE VS A PROCESS AND FOLLOW IT, THEY CAN AVOID A LOT OF THESE ISSUES OF IMPROPRIMATES ETICSY. IMPROPRIETY. >> AND WITH CONTRACTS, JUST ANY OTHER TYPE OF CONTRACT, GRANTEE SH'S ASK THEMSELVES THOSE QUESTIONS THAT WE ALL LEARNED, THE WHO, WHAT, WHERE, WHEN, WHY, HOW AND EVEN HOW MUCH. AND THOSE QUESTIONS RELATE TO, YOU KNOW WHO IS THE CONSULTANT. WHO IS THE SUBCONTRACTOR OR SUBGRANTEE. WHO IS THAT PERSON RELATED TO? WHO WILL THAT PERSON BE DOING? HOW IS THAT PERSON SELECTED TO BE--TO INVOLVE THEMSELVES IN THE CONTRACT ARRANGEMENT WITH THE GRANTEE? THE IMPORTANT PART TO REMEMBER IS WITH CONFLICTS OF INTEREST IT'S ABOUT APPEARANCES AND IF THINGS APPEAR NOT TO BE ABOVE THE BOARD OR ARM'S LENGTH TRANSACTION AT ARM'S LENGTH, THEN YOU SHOULD ABSOLUTELY BE SURE THAT THE PROCUREMENT PROCESS THAT KEN TALKED ABOUT, IS ESTABLISHED AND THAT THE PROCESS FOR SELECTING THE CONTRACTOR OR THE SUBGRANTEE, INVOLVES FAIR AND MARKET VALUE AND THE PROCESSES IS DELINEATED AND ABLE FOR PEOPLE TO SEE WHAT HAPPENS. >> SO GOING BACK TO THE CONSULTANT QUESTION: ARE THERE ANY RULEHOW MUCH YOU CAN PAY CONSULTANTS WITH GRANTS FUNDS? >> YOU KNOW BORIS THERE ARE RULES ON THAT. THE MOST IMPORTANT RULE FIRST AND FOREMOST IS THAT WE PAY CONSULTANTS, VENDORS AND CONTRACTORS WE SHOULD PAY THEM WHAT THEY'RE WORTH IN THE MARKETPLACE. WE SHOULD HAVE FULL COMPETITION AND PAY FOLKS WHAT THEY'RE WORTH. THERE IS NO HARD AND FAST CAP ON THE MAXIMUM YOU CAN PAY A CONSULTANT. MAXIMUM CAN YOU PAY A VENDOR WITH THE EXCEPTION OF SUCH AGENCIES DO PRESCRIBE CAPS BUT THEIR FIRST RULE IS WHAT ARE THEY WORTH, WHAT ARE THEY GOING TO PERFORM, HOW DID YOU DETERMINE THAT'S A REASONABLE RATE. IF IT EXCEEDS A CERTAIN CAP, THERE ARE CERTAIN PROCESSES THAT CAN BE CONSIDERED BUT AGAIN, WE PAY CONSULTANTS AND VENDORS WHAT THEY'RE WORTH THROUGH A GOOD PROCUREMENT PROCESS, NOT WHAT THEY WANT, NOT HOW MUCH MONEY WE HAVE TO SPEND, NOT WHAT A CAP IS. WE PAY THEM WHAT THEY'RE WORTH. >> SO THIS IS DOCUMENTATION THAT'S REASONABLE. >> ABSOLUTELY AND THE DOCUMENTATION PART IS THE WEAKNESS THAT WE SEE IS THAT A GRANTEE MAY TAKE APPROPRIATE ACTION, PAY AN APPROPRIATE AMOUNT OF MONEY BUT THIS THEY CAN'T DOCUMENT WHAT THEY DID OR WHY THEY DID OR HOW THEY DID IT THAT CREATES UNNECESSARY PROBLEMS. >> YES, SO SPEAKING OF DOCUMENTATION, BRANDON, COULD YOU EXPLAIN THE COMMON ISSUES, THE MISUSE OF FUNDS. >> WELL, THE MISUSE OF FUND SYSTEM BASICALLY, IT COMES DOWN TO DOCUMENTATION, OF COURSE, BUT THE MISUSE OF THE FUND SYSTEM SIMPLY STATED, THE USE OF FUNDS FOR THE UNINTENDED PURPOSES OF THE GRANT. THERE ARE WAYS TO PERMIT THAT AND WE'RE GOING TO TALK ABOUT THOSE WAYS. >> AND ANOTHER IMPORTANT THING ON THAT POINT IS THAT REMEMBER A GRANT IS A LEGAL PLEA BINDING AGREEMENT. WHEN WE GIVE SOMEONE GRANT FUND THERE IS' A BUDGET, A PROGRAM NARRATIVE, THERE'S AT THE END OFIDATE THERE'S A WRITTEN AGREEMENT WHERE A GRANDEE SAYS DO THIS RESEARCH, THIS AND HERE'S HOW I WILL DO IT, AND ALONG WITH THAT AGREEMENT, THE GOVERNMENT'S AGREE TO PAY THE COST ASSOCIATE WIDE THAT PROGRAM BUT THE GRANTEE IS ALSO AGREEING TO ABIDE BY A WHOLE HOST OF RULES AND REGULATIONS AND SOME OF THE BIG ONES ARE PROPERLY TRACKING THE USE OF FUNDS. KEEPING GOOD BOOKS AND RECORDS, GIVING ACCESS TO THOSE RECORDS. AND ALSO FOLLOWING A HOST OF REPORTING REQUIREMENTS. QUARTERLY, MONTHLY, WHATEVER IT MAY BE, TELLING THE GRANTING AGENCY, THE PROGRESS YOU'RE MAKING. TELLING THEM HOW MUCH MONEY YOU SPENT. COMMUNICATING WITH THEM PROBLEMS AND THE LIST GOES ON AND ON, BUT THE BOTTOM LINE IS THAT A GRANT IS A LEGALLY BINDING AGREEMENT BETWEEN THE GOVERNMENT AND ANENTITY, RESEARCH UNIVERSITY, INDIVIDUAL AND NONPROFIT TO DO SOMETHING AND WITHIN THAT AGREEMENT, BOTH PARTIES HAVE A LOT OF OBLIGATIONS AND WHAT BRANDON WAS TALKING ABOUT, THE DOCUMENTATION IS KEY. MANY AND MOST GRANTEES DO THE RIGHT THING. THEY JUST HAVE TO BE VERY CONSCIOUS ABOUT DOCUMENTING WHAT THEY'RE DOING AND HOW. AND AS BRANDON MENTIONED, THERE'S A LOT OF WAYS THESE GRANTEE K'S PREVENT--GRANTEES CAN PREVENT THIS ISSUE FROM BECOME PROBLEMATIC. AND THE FIRST ONE THAT COMES TO MIND IS HAVING A GOOD ORGANIZATION COMPLIANCE PLAN. IT CAN BE ANYTHING FROM A SIMPLE BASIC DOCUMENT TO A MORE COMPLEX AND INVOLVED PROCESS. BUT THE PURPOSE OF IT IS FOR A GRANTEE TO SIT DOWN AND REALLY THINK THROUGH HOW THEY'RE GOING TO RECEIVE, ACCOUNT FOR, SPEND AND MANAGE THESE GOVERNMENT FUNDS AND MANAGE THIS PROGRAM AND THERE -A A LOT OF UTILITY FOR GRANTEES AND NEWER GRANTEES AND DOING SOMETHING MORE COMPLICATED THAN THEY'RE USED TO DOING BUZZ IT ALLOWS THEM TO HARB OUT, YOU KNOW WHAT? WE DON'T HAVE AN EXPERTISE IN THIS AREA, OR WE HAVE A WEAKNESS IN ACCOUNTING OR WE HAVE A NEED TO HIRE 50 NEW PEOPLE FOR THIS PROGRAM. IN A GOOD COMPLIANCE PLAN, YOU WOULD ARKS DEPTIFY THOSE PROBLEMS, WEAKNESSES AND ADINTIFY THOSE AREAS YOU NEED HELP IN AND THAT WOULD HELP PREVENT FUTURE PROBLEMS, SIX MONTHS, A YEAR OR TWO YEARS DOB THE ROAD. >> AND OBTAINING A GRANT IS NOT--VERY, VERY, DIFFICULT WORK THAT GOES INTO IT. AND PART OF THE APPLICATION, GRANTEES OR APPLICANTS HAVE SUBMITTED AN APPLICATION AND PROPOSED THE BUDGET, THAT APPLICATION IN THE BUDGET SHOULD BE REALISTIC AND SOMETHING THAT THE GRANTEE OR THE APPLICANT IS ABLE TO ACCOMPLISH. IN ORDER TO DO THAT, GRANTEE SHOULD HAVE SOMEONE REVIEW THE APPLICATION, DISCUSS AMONGST THEMSELVES, JUST GRANT SOMETHING THAT WE'RE ABLE TO PERFORM WITH THE ABILITIES THAT WE HAVE AS AN ORGANIZATION. AND BORIS ANOTHER KEY THING GRANTEES CAN DO TO PREVENT THIS ISSUE FROM BECOMING A BIG PROBLEM IS TO INSURE THAT THEY READ AND UNDERSTAND THAT FINAL GRANT, AGREEMENT GRANT AWARD PACKAGE AND THEY MAY SOUND VERY BASIC, BUT THE MORE FOLK AT A GRANTEE ORGANIZATION, PRINCIPLE INVESTIGATOR, THE ACCOUNTANT BOOK KEEPER, WHATSOEVER IT MAY BE, MORE PEOPLE THAT READ THAT FINAL GRANT AWARD PACKAGE AND UNDERSTAND IT, THE BETTER ABLE THENTITY IS TO ANTICIPATE PROBLEMS AND IDENTIFY PROBLEMS, FIX WEAKNESSES. SO AGAIN WE WANT TO MAKE SURE THEY READ THAT. EVERYBODY AT THE TABLE UNDERSTANDS, HERE'S OUR END OF THE BARGAIN, HERE'S WHAT WE'RE OBLIGATED TO DO AND THEN THEY CAN FOCUS MORE ON CARC COMPLISHING WHAT IT IS THEY'RE TRYING TO DO. >> AND AS I MENTIONED EARLIER, IT'S ALL ABOUT DOCUMENTATION. DOCUMENTATION IS VERY IMPORTANT AND IN THAT YOU HAVE TO BE SURE YOU SUPPORT EVERY ASSERTION YOU MAKE TO THE GRANTEE ORGANIZATION AND THE GRANTING AGENCY. SO ANY FINANCIAL STATEMENTS THAT YOU SUBMIT WHEN YOU DRAW DOWN FUNDS, YOU MUST BE ABLE TO SUPPORT THOSE WITHDRAWALS WITH ACTUAL DOCUMENTS RECEIPTS INVOICES AND SAME THING FOR ASSERTIONS IN THE PROGRAMS AND THE AMOUNT OF COMPLIANCE THAT YOU'RE TREATING. AND SERVICES THAT YOU RENDER, MUST BE ABLE TO SUPPORT THAT WORK AND WHAT YOU SUBMIT TO THE ORGANIZATION. IT'S VERY IMPORTANT. >> THIS ALSO APPLIES TO THE CLIENTELE, SERVICES WHAT YOU DO--ALL THIS FALLS INTO THE GENERAL AREA OF MAINTAINING DOCUMENTATION AND TRACKING WHAT YOU DO TO MEET THE ORIGINAL APPLICATION SPECIFICATIONS. >> ABSOLUTELY RIGHT FELT. >> AND ANOTHER AREA BORIS THAT WE COMMONLY SEE IT, IT DOES APPLY TO ALL GRANTEES AND THIS ISSUE OF PROGRAM INCOME. THERE'S GRANT FUNDED PROGRAMS THAT BY THE VERY NATURE THEY PRODUCE INCOME, TRAINING FEES, CLIENT FEES AND THERE'S A LOT OF GOOD REASONS TO DO THAT BUT IT'S IMPORTANT THAT IF GRANTEES ARE GOING TO GENERATE PROGRAM INCOME, THEY THINK ABOUT THAT AND INSURE THEY HAVE A PROCESS TO PROPERLY ACCOUNT FOR THAT PROGRAM INCOME, RECEIVE IT, AND GET IT INTO THE ACCOUNTING SYSTEM AND THEN HAVE A GOOD UNDERSTANDING WITH THEIR FUNDING AGENCY HOW AM I TO TREAT THIS PROGRAM INCOME. AM I TO USE THIS TO OFFSET MY EXPENSES. KIUSE IT FOR NEW PURCHASES? BUT HOW AM I GOING TO TREAT THIS? ONE THING WE SEE MANY ORGANIZATIONS HAVE CHALLENGES WITH IS PROGRAM INCOME WHEN THEY DON'T THINK ABOUT, DON'T CONSIDER IT UNTIL THERE'S AN AUDIT OR A REVIEW UNTIL SOMEONE SAYS WHAT HAVE YOU DONE WITH THE PROGRAM INCOME AND THAT'S TOO LATE TO THINK ABOUT THAT TOPIC. GOT TO DO THAT EARLY. >> AND SAME THING WITH THE PROGRAM INCOME THERE'S ALSO THE ISSUE OF GRANTEES WHO RECEIVE MULTIPLE SOURCES OF FUNDING. THERE ARE A LOT OF GRANTEES THAT ONLY HAVE ONE GRANT AND THERE ARE OTHERS OUT THERE AND WE'RE SEEING MORE WHERE THEY HAVE MULTIPLE SOURCES OF GRANT MONEY COME NOTHING FOR THE SAME OR SIMILAR PROGRAMS AND IT'S IMPORTANT THAT GRANTEES ACCOUNT FOR THE THE DIFFERENT SOURCES OF INCOME TO INSURE THAT THE MONITOR THAT'S IS RECEIVED HAS BEEN EXPENDED FOR THE APPROPRIATE GRANT PROGRAM. SO IT IS ACCEPTABLE FOR A GRANTEE TO BE FUNDED FOR MORE THAN--BY MORE THAN ONE GRANT FOR THE SAME PROGRAM? >> IT IS, BORIS. THERE'S NO BLANKET PROHIBITION AGAINST A GRANT FUNDED AGENCY RECEIVING FUNDS FROM MORE THAN ONE SOURCE. THAT HAPPENS COMMONLY. YOU MAY GET FUNDING FROM A PRIVATE FOUNDATION, TWO OR THREE FEDERAL AGENCIES STATE PASS THROUGH AND OTHER DONATIONS. THE KEY POINT HERE IS THAT THE GRANTEES HAVE TO TRACK THEIR EXPENSES AND OF COURSE ONLY CLAIM THEIR EXPENSES ONCE. SO AT THE END OF THE DAY, A GRANT FUNDED ORGANIZATION THAT'S RECEIVING MULTIPLE SOURCES OF FUNDING, HAVE TO BE ABLE TO TRACK THE EXPENSES AND THE USE OF EACH OF THOSE SOURCES OF FUNDING AND OF COURSE, IN TOTAL, CAN'T CLAIM AND COLLECT MORE MONEY THAN THEY DESERVE AS A REIMBURSEMENT SO IT IS A CHALLENGING AREA FOR SOME ORGANIZATIONS BUT AGAIN, ONE OF THOSE ORGANIZATIONS WITH A LITTLE BIT OF THOUGHT CAN PROACTIVELY BE MITIGATED AND HANDLED EARLY RATHER THAN LATER. AND RELATED TO THAT BORIS, ANOTHER KEY AREA THE GRANTEES CAN THINK ABOUT EARLY, IS THIS AREA OF TIME SHEETS. TO PREVENT THE MISUSE OF FUNDS OR LACK OF DOCUMENTATIONS OR GRANTEES GIVE CAREFUL THOUGHT TO HOW THEY'RE GOING TO TRACK THE PERSONNEL TIME AND EFFORT REPORTS, THE ACTUAL HOURS OF WORK AND HAVE TO INSURE THEY HAVE A GOOD POLICY FOR DOING THAT AND THEN ALMOST AS IMPORTANT AS THAT IS INSURE THE POLICY IS FOLLOWED, INSURE THAT A ACCURATELY AND IN A TIMELY FASHION RECORD THEIR TIME AND EFFORT TO EACH FEDERAL PROJECT OR EACH DIFFERENT TYPE OF PROJECT. AGAIN AS BRANDON SAID TO INSURE THAT YOUR ASSERTIONS AT THE END OF THE DAY, YOUR HUNDRED THOUSAND DOLLARS CLAIM OR PERSONNEL IS SUPPORTED SOMEWHERE BY THE TIME SHEET AND TIME AND EFFORT DOCUMENT OR SOME OTHER APPROPRIATE DOCUMENTATION. >> SO WHAT ABOUT IN. DIRECT COST RATES. KEN'S AND AND IT'S INDIRECT COST ON AND INDETERMINE IT TO INTREK COST RATES. IT'S A COMPLEX AND CUMBERSOME ISSUES THAT GRANTEES HAVE TO HAVE ISSUES? >> BRANDON IS RIGHT, THEY'RE OFTEN A COMPLEX AND MAYBE AN UGLY AREA OF THE ACCOUNTING PROCESS FOR GRANTS. BUT INDIRECT COSTS IS A RATE THAT GRANTEES CAN AT THEIR OPTION USE TO CAPTURE COSTS THAT THEY CAN'T CAPTURE DIRECTLY. THE BUT THE KEY TAKE AWAY FOR THE GRANTEES IN THE AUDIENCE, IS THAT IF YOU USE AN INDIRECT COST RATE, IF YOU ARE GOING TO EXERCISE THAT OPTION, BE VERY CAREFUL ABOUT HOW DO YOU THAT, AND BE SURE HOW IT'S BEEN CALCULATED BY SOMEONE THAT HAS SOME EXPERTISE IN THAT AREA, PERHAPS AN ACCOUNTANT OR A FISCAL OFFICER OR INSURE THAT IT'S ADJUSTED PROPERTILY IF IT NEEDS TO BE AND ALSO INSURE IT'S APPLIED CORRECTLY AND THIS IS AN AREA THAT WE'VE SEEN GRANTEES HISTORICALLY NOT PAY AS CLOSE ATTENTION TO AS THEY SHOULD AND THERE ARE SOME REALLY BAD RAMIFICATIONS TO THAT BECAUSE IF HAVE YOU AN INDIRECT RATE THAT YOU THINK IS SOMEWHAT ACCURATE AND FOR THE NEXT FIVE YEARS YOU USE THAT RATE AND THEN IT'S DISCOVERED THAT YOU ARE WAY OFF, IF SOMETHING ELSE YOU ARE GOING TO HAVE TO PAY THE GOVERNMENT BACK SOME OF THAT MONEY OR IF YOU ARE DOING IT IN THE GOVERNMENT'S FAVOR, YOU MAY BE SHORTING YOURSELF OF SOME OF THOSE FUNDS. SO AGAIN THIS IS AN AREA AND YOU MIGHT WANT TO FIND THE EXPERTS TO HELP YOU WITH AND INSURING YOU CAN DO IT PROPERLY BECAUSE IT CAN HURT YOU EITHER WAY IF YOU'RE OFF. >> THANK YOU. CAN YOU ALSO ADDRESS, KEN, THE ISSUE OF AND EMBEZZLEMENT TO THE CONTEXT OF GRANTS FUNDS? >> SURE, THIS IS THE THIRD BIS RISK WE WANTED TO TALK ABOUT TODAY BUT PROBABLY ONE OF THE MORE COMMON ISSUES WE SEE WITH GRANTEES. AND THAT'S THE ISSUE OF EMBEZZLEMENT WHERE SOMEBODY THAT IS VERY SMART, CONI'VING, CREATIVE--CONNIVING, CREATIVE TO MANIPULATE THE SYSTEM TO TAKE MONEY THAT DOESN'T BELONG TO THEM. AND THIS IS A BIG RISK WHETHER YOU'RE FEDERAL GRANT OR A BANK OR A LAW FIRM OR HOSPITAL OR SCHOOL OR FEDERAL GOVERNMENT OR ANENTITY THAT RECEIVES THESE FUNDS. AND THE KEY RECURRING THEME OF EMBEZZLEMENT IS A LACK OF GOOD INTERNAL CONTROLS OR CIRCUMVENTION OF THOSE INTERNAL CONTROLS. AND INTERNAL CONTROLS ARE THOSE MECHIMISMS THAT ARE IN PLACE TO INSURE THAT THE--FINAL FINANCIAL STATEMENTS OR REPORTED HOW WE USE FUNDS IS AN ACCURATE NUMBER. THERE SO THERE'S ALL THESE DIFFERENT PROCESSES, THE APPROVAL OF TIME SHEET BY A SUPERVISOR, THE REVIEW OF TRAVEL VOUCHER BY SOMEONE IN THE FINANCE OFFICE AND THOSE ARE ALL STEPS IN THE ACCOUNTING PROCESS THAT FALL UNDER THE UMBRELLA OF INTERNAL CONTROLS. WE DON'T DO THEM TO WASTE TIME, WE DON'T DO THEM TO HAVE PEOPLE JUST SIGN THEIR NAMES ALL DAY LONG. WE DO THEM TO TRY TO INSURE THE MONEY'S GOING TO THE RIGHT PLACE AND THE RIGHT AMOUNT FOR THE RIGHT PURPOSE AND SO, ANYTIME SOMEONE CIRCUMVENTS THOSE CONTROLS, THOSE CONTROLS ARE NOT HONORED, THEN WE HAVE A POTENTIAL PROBLEM, THAT VERY OFTEN BECOMES A BIGGER PRACTICAL BECAUSE SOMEONE WILL FIND A WAY TO STEAL THAT MONEY MANIPULATE THE SYSTEM, TO BENEFIT THEMSELVES PERSONALLY. A LOT OF WAYS THIS CAN BE PREVENTED AND SIMPLE WAYS. THE GRANTEES CAN DO TO REDUCE THEIR RISK OF EMBEZZLEMENT. THE FIRST ONE THAT COMES TO MIND IS THE ISSUE OF ACCEPT RATIONS OF DUTIES. AND THAT'S NOTHING MORE THAN INSURING THAT WE DON'T ALLOW ANY ONE PERSON TO SPEND THE ORGANIZATION'S MONEY, BALANCE THE ORGANIZATION'S CHECK BOOK, ACCOUNT FOR ALL THE FUNDS OR ASSETS OR SERVICES PURCHASED, REPORT TO THE GOVERNMENT HOW IT'S SPENT. WE DON'T ALLOW ANYONE TO DO THOSE FUNCTIONS NOT BECAUSE WE DON'T NECESSARILY TRUST THAT PERSON BUT BECAUSE WE HAVE PEOPLE INVOLVED IN THE PROCESS, WE HAVE A BETTER CHANCE OF LESS MISTAKES, WE HAVE A BETTER CHANCE OF FOLLOWING ALL THE POLICIES AND PROCEDURES AND WE ALSO HAVE A BETTER CHANCE TO NO ONE OF SUSGOING TO FIND A WAY TO STEAL MONEY BECAUSE ALL THREE OF US ARE PAYING ATTENTION TO THAT PROCESS. THIS IS IMPORTANT TO PREVENT THIS ISSUE. >> SO THESE ARE PRACTICAL IDEAS, YOU HAVE BRANDON WHERE YOU COULD IMPLEMENT SOME OF THESE IDEAS? >> ABSOLUTELY AND IN KEEPING WITH THE THE SEPARATION OF DUTIES, THE GRANTEES SHOULD CONSIDER USING THE SERVICES OF AN OUTSIDE BOOK KEEPER OR CPA, OR EVEN AN ACCOUNTANT TO HANDLE THE FISCAL ISSUE OF THE ORGANIZATION, UNDER THE THEORY THAT SOMEONE WHO'S NOT DIRECTLY EMPLOYED BY THE AGENCY WOULD BE IN THE BETTER POSITION TO DETECT PROBLEMS THAT OCCUR IN THE VAIN OF WHAT HE MENTIONED REGUARDING SOMEONE WHO IS, YOU KNOW MESSING AROUND WITH THE FINANCES OF THAT SORT AND SOMEONE WHO DOESN'T HAVE A VESTED INTEREST IN THE ORGANIZATION TO SEE THESE PROBLEMS, DETECT THESE PROBLEMS AND IT'S GOOD TO HAVE AN UNRELATED SET OF EYES TO TAKE A LOOK AT THIS, PARTICULARLY IF THE AGENCY OR THE GRANTEE ORGANIZATION DOESN'T HAVE THE CAPACITY TO PERFORM THOSE DUTYYS THEMSELVES--DUTIES THEMSELVES. >> THAT'S AN IMPORTANT POINT BRANDON MAKES BECAUSE THERE ARE A NUMBER OF ENTITIES THAT ARE GOOD AT PROVIDING SERVICES OR ENTRIES PROVIDING MONEY, BUT WHEN IT COMES TO KEEPING GOOD BOOK KEEPING OR GENERAL LEDGER THAT MAY BE LOW ON THE PRIORITIES OR EXPETER EASE. SO THERE'S NOTHING WRONG WITH IDENTIFY TAG WEAKNESS AND FINDING A WAY TO MITIGATE THAT RISK AND TO FIND AN OUTSIDE PARTY. >> ANOTHER BIG ISSUE, I WANT TO RAISE WITH THE AUDIENCE WITH GRANTEES RELATED TO EMBEZZLEMENT IS THE POLICY OR THE PROCESS OF REIMBURSING YOUR INDIVIDUAL EMPLOYEES FOR EXPENSES. WHAT I MEAN BY THIS IS THAT VERY OFTEN A GRANT FUNDED ORGANIZATION HAS A NEED TO BUY A LOT OF GOODS, SERVICES, TRAVEL, FOOD, SUPPLIES, WHATEVER IT MAY BE TO DO THE PROGRAM AND THAT'S IMPORTANT THAT THEY GET WHAT THEY NEED TO DO THE JOB. BUT THE THING TO CONSIDER HERE IS WHAT'S THE BEST WAY, WHAT'S THE SAFEST WAY FOR THE ORGANIZATION TO MAKE THOSE PURCHASES? AND I SUBMIT TO YOU THAT THE BEST WAY IS OFTEN NOT TO ALLOW EACH INDIVIDUAL EMPLOYEE TO GO OUT AND BUY WHATEVER THEY NEED WHENEVER THEY NEED IT AND THEN SEND IN THE RECEIPTS LATER AND REIMBURSED. FIRST OF ALL THAT'S AN INEFFICIENT PROCESS AND SECOND OF ALL YOU'RE NOT GETTING THE BEST BANG FOR YOUR BUCK, YOUR PURCHASING POWER, BUT YOU LOSE A LOT OF CONTROL ABOUT WHAT IS WHERE, HOW MUCH YOU PAY FOR SOMETHING AND WE DON'T ALWAYS KNOW IF THAT PURCHASE IS ACTUALLY MADE SO ONE GREAT WAY TO REDUCE A RISK OF EMBEZZLEMENT IS TO DISCOURAGE THAT PRACTICE AND FIND A WAY AROUND THE PRACTICE OF CONSTANTLY WRITING EMPLOYEES CHECKS OR LETTING THEM USE THE DEBIT CARD OR EVEN WORSE, GIVING THEM CASH TO GET WHAT THEY NEED WHEN THEY NEED IT BECAUSE THEN YOU LOSE ALL CONTROL OF OF HOW THAT MONEY IS BEING USED. >> SO THIS IS REALLY, REALLY IMPORTANT, ISSUE THAT YOU'RE BRINGING UP, IMPORTANT PRACTICE, OF HAVING THIRD PARTIES VIEW WHAT OCCURS TO MAKE SURE THEY'RE LEGITIMATE AND THERE SUBJECT A CENTRALIZED INDIVIDUAL OR OFF THEY'S HANDLES ALL THE FINANCIAL TRANSACTIONS. WHAT WOULD BE A WAY FOR AN EXAMPLE FOR AN ENTITY TO MAKE THOSE KINDS OF CHECKS REAL? >> WELL, DEFINITELY THE REVIEW PROCESS IS IMPORTANT. THERE HAVE BEEN MANY GRANTEE ORGANIZATION THAT HAVE BEEN DESTROY BIDE SOMEONE WHO EMBEZZLED FUNDS FROM THE ORGANIZATION. THAT HURTS THE GRANTEY ORGANIZATION OF COURSE AND THE EMPLOYEES ARE PARTICULARLY IF THEY ARE NO LONGER ABLE TO OPERATE, BUT ALSO AFFECTS THE COMMUNITY AT LARGE BECAUSE THE SERVICE HAS NOT BEEN PROVIDED AND THE MONEY WAS GIVEN FOR THE SERVICES TO BE PROVIDED. SO ONE OF THE THINGS THAT GRANTEE SH'S CONSIDER IS HAVING PULLET PEL PARTIES REVIEW THE BANK STATEMENTS. IT SOUNDS VERYICISM AND HE WILL IT IS VERY SIMPLE, BUT HAVE AT LEAST TWO PEOPLE DO IT. SOMEONE WHO IS IN THE ORGANIZATION, OF COURSE, THAT ACCOUNTS IN OUR FISCAL AGENT, BUT THEN ALSO CONSIDER HAVING SOMEONE IN THE OVERSIGHT BOARD, YOU KNOW THE TRUSTEES OR THE BOARD OF DIRECTORS. SOMEONE WHO OVERSEES THE ORGANIZATION, THE GRANTEE, TAKE A LOOK AT THOSE BANK STATEMENTS AS L. YOU HAVE TWO SETS OF EYES TAKING A LOOK AT THE DOCUMENTS AND THE ONE PERSON THAT MISSES A TRANSACTION THAT SHOULDN'T BE THERE SO DEVELOPMENTAL ENDOCRINOLOGY FITLY THE MORE PEOPLE WHO TAKE A LOOK AT AND REVIEW IT, THE PROCESS, THE GREATER THE OPPORTUNITY TO DETECT FRAUDULENT ACTIVITY. SO I'M GUESSING KEN THAT THIS METHOD IS SPREADING THE REVIEW PROCESS AMONG MORE THAN AN OFFICE OR AN INDIVIDUAL, SHOULD APPLY TO EVERY METHOD OF PAYMENT THAT'S USED BY GOOD NIGHTEE ORGANIZATION--GRANTEE ORGANIZATION. >> IT REALLY SHOULD, AND FOR MOST GRANTEES AND FOR THOSE WATCHING OUT THERE, IF YOU THINK ABOUT IT, YOU ONLY SPEND MONEY IN A HAND FUL OF WAYS, THERE'S PAY ROLL PROCESS, CHECKS TO VENDORS, CREDIT CARDS, ATM CARD, YOU MAY HAVE CASH, GIFT CARDS, YOU HAVE TO THINK ABOUT EACH OF THOSE METHODS OF MONEY LEAVING THE ORGANIZATION AND INSURE THAT YOUR ORGANIZATION HAS A GOOD WAY TO CONTROL THOSE TOOLS, REVIEW THOSE TOOLS IN A REGULAR BASIS AND THE PHYSICAL CUSTODY OF THE ATM CARD IS REALLY A VERY BASIC WAY TO CONTROL HOW THEY'RE USED EMPLOYING. >> THERE MUST ALSO BE KEY ISSUES TO MAINTAINING FISCAL CONTROL. ARE THERE ANY ISSUES THAT ARE GOOD FOR SOMETHING THAT MIGHT BE OUT OF WHACK? >> ABSOLUTELY, GRANTEE ORGANIZATIONS MYSELFATION AND THE OVERSIGHT OFFICE SHOULD BE AWARE OF ANY GOOD NIGHTEE, INVOLVING PAY ROLL ADVANCES, AN EMPLOYEE WHO HAS YET TO PERFORM THE SERVICES FOR WHICH THEY WOULD HAVE EARNED A CHECK, ALSO IRS TAX WITH HOLDINGS AND STATE AND LOCAL TAX WITH HOLDINGS AND THOSE ARE TAX REVENUES THAT ARE HELD BY THE EMPLOYER UNTIL THEY'RE PAID TO THE STATE, AND IT'S BIG SITTING IN THE BANK AND JUST WAITING TO BE PAID TO THE THE GOVERNMENT, AND SOMEONE CAN KEEP AN EYE ON THAT MONEY AND THE POTENTIAL EXISTS PARTICULARLY IF THERE'S A LACK OF INTERNAL CONTROLS TO MONITOR THAT MONEY AND FOR IT TO BE STOLEN. SO ORGANIZATION SH'S DEFINITELY BE AWARE THAT SHEA SHOULD INSTITUTE POLICIES FOR DEALING WITH THOSE SITUATIONS, FOR DEALING WITH ADVANCES, DEALING WITH THE IRS TAXES OR THE TAX WITH HOLDINGS ISSUES TO BE SURE THAT MONEY IS SAFE GUARDED AND ACCOUNTED FOR BECAUSE WHEN IT'S TIME FOR IT TO BE REMITTED, THE IRS IS GOING TO EXPECT TO RECEIVE ITS CHECK. >> CAN I ADD? >> ABSOLUTELY. >> THE REASON WE BRING THOSE UP, WE ARE BOTH CRIMINAL INVESTIGATORS AND WE KNOW FROM OUR WORK AT OUR AGENCY AND OTHER INSPECTOR GENERALS ACROSS THE COMMUNITY THAT THOSE ARE THREE BIG ISSUES THAT ARE COMMONLY--COMMONLY EXIST OR ARE FOUND AFTER THE FACT WHEN SOMEONE STEALS MONEY FROM A GRANT FUNDED ORGANIZATION AND THE PAY ROLL ADVANCES IS ONE THAT TAKE AWAY THE THEFT ISSUE, GRANTEES SHOULD NOT BE PAYING EMPLOYEES WITH FEDERAL GRANT FUNDS, FOR WORK THAT IS NOT YET BEEN PERFORMED. IF A GRANT FUNDED ORGANIZATION HAS A POLICY OF COLLECTING A PAYCHECK IN ADVANCE, THEY MAY BE ABLE TO DO THAT YOU BUT THEY SHOULDN'T BE USING FEDERAL FUNDS FOR THAT. BUT THE RISK THERE, REGARDLESS OF WHOSE FUND ITS ARE, IS THE MINUTE,A YOU LOW A EMPLOYEE TO CHECK A PAYCHECK A MONTH IN ADVANCE, BECOMES A FEW MONTHS IN ADVANCE, IT'S DIFFICULT TO TRACK HOW MUCH YOU COLLECTED, HOW MUCH YOU EARNED AND THE ISSUE WE SEE IS IRS WITH HOLDING ISSUE THAT BRANDON MENTIONED EVERY TIME WE GET A PAYCHECK A CERTAIN AMOUNT IS PATTED OUT OVER THE IRS, WELL IN MANY INSTANCES, A BOOK KEEPER MIDLEVEL EMPLOYEE WILL DO THAT, BUT THEN FAIL TO ACTUALLY PAY ALL THOSE TACK TAXES TO THE IRS AND AS BRANDON SAID THAT THEN CREATES A POOL OF FIVE, 10, $25,000 IN THENTITY THAT EVERYONE THINKS IS GONE TO THE IRS. THE IRS WILL QUICKLY LET YOU KNOW WITHIN A FEW MONTHS THAT THEY HAVEN'T RECEIVED THAT MONEY AND BY THEN IT MAY BE TOO LATE. SO AGAIN IT'S IMPORTANT FOR THE OVERSIGHT MECHANISMS THAT ARE A GRANTEE TO LOOK AT BOTH OF THOSE THINGS TO INSURE THAT THE MONEY IS GOING WHERE IT'S SUPPOSED TO BE. AGAIN IT'S A GOOD INTERNAL CONTROL. IT'S CHECK, BALANCE AND INSURE THAT THE TRANSACTION WE SEE ON PAPER ARE ACTUALLY OCCURRING, SO WE KNOW THAT WE'RE DOING THINGS. >> YEAH, WE AT THE GRABTS .GOV OFFICE BEING THE CENTRALIZED PORTAL FOR APPLY, WE GET A FAIRLY LARGE NUMBER OF CALLS TO OUR CONTACT CENTER AND WITH REGUARD TO AND RECEIVING CALLS SAYING WE CAN HELP YOU WITH GRANTS, WE CAN HELP YOU PAY IN A GRANT AND TYPICALLY A FEE INVOLVED AND THINGS LIKE THAT. ON WATCH TO MAKE SURE THAT THESE HAPPEN, AND IT'S A PROGRAM LIKE THESE TWO TO SUGGEST A METHOD THAT PEOPLE CAN MAKE AN ENTRY METHOD, A BASIC METHOD TO KEEP THINGS STRAIGHT. WE ALSO GET CALLS FROM AND IN THE COURSE OF INVESTIGATION AND INVESTIGATORRING PRECISELY TYPES OF ISSUES THAT YOU RAISED WITH THE GRANTEES BUT I WAS WONDERING FROM THE STANDPOINT OF GRANTEES, WHAT SHOULD THEY DO IF THEY HAVE ANY CONCERNS WITH REGARD TO THE ISSUES WE DISCUSSED TODAY. >> IT'S LIKE I MENTIONED EARLIER, IT'S ALL ABOUT EDUCATION AND YOU KNOW WE'RE OUT AS PART OF THE I.T. COMMUNITY TO RAISE AWARENESS TO THE ISSUES OF GRANT FRAUD AND THE REASON BEING GRANTS AFFECTS JUST ABOUT EVERYONE'S LIVES WHOSE WATCHING THE PROGRAM TODAY, EACH THE THREE OF US, THE FIRST THING GRANTEE SH'S DO TO--EXCUSE ME FRAUD IN THEIR PROGRAM IS THAT THEY SHOULD CONTACT THEIR GRANT PROGRAM OFFICE. THEY SHOULD DISCUSS THOSE QUESTIONS WITH THE GRANTS OFFICIAL OR THE PEOPLE THEY DEAL WITH AT THE PROGRAM OFFICE TO DISCUSS IT. IT VERY WELL COULD BE A MISTAKE OR ANERB OF FRAUD. THE POINT IS, THEY SHOULD BRING THAT UP AS SOON AS THEY RECOGNIZE THEY HAVE AN ISSUE THAT CAUSES THEM SOME CONCERN. THE SECOND THING THEY CAN DO IS CONTACT THE OFFICE OF THE OIG THAT AWARDED THE FUNDS. THE INSPECTOR GENERAL ARE WITH INVESTIGATORS AND AUDITORS AND PROGRAM EVALIATORS AND THOSE PEOPLE THAT TRAIN TO GO OUT LOOK AT PROGRAMS AND DETECT PROBLEMS AND RECOMMEND SOLUTIONS TO NEGATE SOME OF THE PROBLEMS THEY MAY HAVE ENCOUNTERED. AND THE THIRD THING THEY CAN DO IS CONTACT THE FEDERAL FRAUD ENFORCEMENT TASK FORCE AND THAT WEB SITE IS: WWW.STOPFRAUD.GOV. >> WELL, THANK YOU. NOW THE STOPFRAUD.GOV, IS A GENERAL WEB SITE FOR REPORTING FRAUD ABUSE. BUT HOW DO PEOPLE GET SPECIFIC CONTACT INFORMATION TO REPORT ACTIVITIES THAT THE INSPECTOR GENERAL OF SPECIFIC AGENCIES, AND THOSE IG NET.GOV A LISTING FOR THE FEDERAL AGENCIES FOR THE OFFICE OF INSPECTOR GENERALS AND INCLUDE THE FEDERAL GRANT DOLLARS AND OF COURSE YOU CAN ALWAYS GO TO YOUR FAVORITE SEARCH ENGINE AND TYPE IN OFFICE OF INSPECTOR GENERAL OF WHICHEVER AGENCY THAT YOU'RE LOOKING FOR. SO JUST GOOGLE IT IN. THAT'S SOMETHING THAT EVERYONE'S FAMILIAR WITH. >> ABSOLUTELY. >> WELL, THANK YOU GENTLEMAN, THANK YOU VERY MUCH FOR THAT INTERESTING AND EDUCATIONAL EXCHANGE AND NOW, I WOULD LIKE TO TAKE THIS OPPORTUNITY TO REMIND THE VIEWERS OF GRANTS.GOV SUPPORT RESOURCES THAT ARE AVAILABLE IN THE EVENT THAT ANY OF US STAKE HOLDERS NEED ASSISTANCE. THE GRANTS.GOV IS A WEB SITE THAT'S BEEN AROUND FOR A NUMBER OF YEARS. WE HAVE THE EXPERIENCE AND THE KNOWLEDGE BASE BOTH ON OUR STAFF AND FROM THE STAKEHOLDER COMMUNITY. WE ARE SUPPORTED BY THE GRANTS EXECUTIVE BOARD WHICH IS CONSISTING OF PEOPLE IN THE GRANT BASICKING BUSINESS AND ON THE GRANTS DEPARTMENT AND THE GRANTS AGENCY AND THE GOVERNMENT AND OF COURSE OMB IS AN INVALUABLE PART OF ALL OUR ACTIVITIES. TAKE THANKSGIVING KNOWLEDGE BASE OF THE BASES, WE PUT OUT RESOURCES ON OUR WEB SITE. THERE'S A HELP URL, WHICH TELLS YOU EVERYTHING ABOUT GRANTS.GOV. THERE'S ANIMATED TUTORIALS TO WALK YOU THROUGH THE WAY WE DO THINGS, THE RIGHT WAY OF DOING THINGS, HOW TO DO THEM SO YOU DON'T NEED HELP, CAN YOU DO IT RIGHT THE FIRST TIME. THERE ARE PROSURES WITH OVERVIEWS OF THE ENTIRE PROCESS AND THE REGISTRATION PROCESS. WE ARE TAKING THE ENTIRE KNOWLEDGE BASE, GATHERED OVER TIME AND PUT IT INTO A FREQUENTLY ASK TED--ASKED QUESTIONS FILE. SO THE QUESTIONS HAVE YOU CAN PROBABLY BE ANSWERED FROM THAT FILE AND WE'D LIKE TO ADD SOME OF THE THE FRAUD RELATED ISSUES TO IT IF THEY DON'T EXIST ALREADY. WE HAVE USER GUIDES THAT EXPLAIN IN DETAIL HOW TO DO WHAT YOU WANT TO DO, ACTIVITIES RELATED TO GRANTS, PARTICULARLY ON GRANTS.GOV. AND THERE IS A TROUBLE SHOOTING APPROACH TO FIGURE OUT IF YOU HAVE ANY PROBLEM, WHAT PARTICULAR PROBLEM THAT IS. AND OF COURSE, WE HAVE THE CONTACT CENTER STAFFED BY DEDICATED STAFF WHO ARE FAMILIAR WITH THE THE PROCESS, WHO ARE READY TO ANSWER QUESTIONS. THERE'S AN 800 NUMBER ON THE WEB SITE AS WELL AE-MAIL: SUPPORT @GRANTS.GOV. WE HAVE A PORTAL WHICH IS THE CENTRALIZED PORTAL TO GET RESPONSES TO ALL YOUR GRANTS.GOV RELATED WEB CONNECTEDS, AT THIS POINT IN OUR WEBCAST, I WILL TURN OUR ATTENTION TO ANSWERING QUESTIONS. AT THE BEGINNING OF THIS WEBCAST, IT WAS WWW.GRANTS.GOV-WEBCAST AT HHS.EDU. AND IF YOU'RE UNABLE TO ANSWER YOUR QUESTIONS WE WILL ANSWER THEM AND ARCHIVE THEM IN THE--WHEN WE POST THIS WEBCAST. SO HERE WE HAVE THE FIRST QUESTION, FROM ONE OF OUR VIEWERS, MY ORGANIZATION IS IN CONSISTENT IN ITS TIME KEEPING PRACTICES. WHAT ARE SOME GOOD PRINCIPLES OF TIME KEEPING. >> WELL THAT'S AN IMPORTANT QUESTION. I THINK IF YOU LISTEN BEFORE, I TALK ABOUT THE IMPORTANCE OF HAVING GOOD SOLID BASE TO SUPPORT YOUR ASSERTIONS, SUPPORT YOUR CLAIMS TO THE GOVERNMENT AND IF YOU THINK ABOUT A CLAIM TO THE GOVERNMENT FOR MONEY WHICH A PART OF THAT CLAIM IS A PERSONNEL COST, IF IT DRILLS DOWN TO A TIME SHEET THAT A INCONSISTENTLY IT CAN BE KEPT THAT, CAN BE A BIG PROBLEM. SO THE MOST IMPORTANT PART OF TIME KEEPING IS HAVE A GOOD POLICY THAT EVERYONE UNDERSTANDS TO CONSISTENTLY AND ACCURATELY RECORD HOW PEOPLE SPEND THEIR TIME, THEIR TIME AND EFFORT ON WHICH PROJECTS, AND THEN INSURE THAT THAT POLICY IS FOLLOWED. VERY, VERY, DANGEROUS TO CHANGE PEOPLE'S TIME CARDS AFTER THE END OF THE THE PERIOD. VERY DANGEROUS TO HAVE OTHER PEOPLE COMPLETING TIME CARDS FOR OTHER PEOPLE. WE HAVE TO INSURE THAT EACH INDIVIDUAL PERSON'S TIME CARD IS FILLED OUT BY THEM, IS ACCURATE AND IS THEN USED TO BUILD UP TO THAT COST CLAIM SO THE IMPORTANT PRINCIPLE IS TO MAKE SURE YOU HAVE A PROCESS FOR ACCURATE TIME KEEPING DOCUMENTS. NOT ALWAYS EASY BUT IT'S IMPORTANT YOU DO THAT AND YOU DO THAT CONSISTENTLY. >> AND VERIFIABLY. >> ABSOLUTELY. >> ANOTHER QUESTION FROM SOMEONE IN THE COMMENTS: THERE ARE COMMENTS FROM THE MEDIA AND FROM THE GENERAL PUBLIC ABOUT PERCEIVED CONPREDICTS OF INTEREST AND MISUSE OF GRANTS FUNDS. WHAT SUGGESTIONS DO YOU HAVE FOR GRANTEES TO BEST KEEP THE PUBLIC AND MEDIA INFORMED AND PREVENT THE APPEARANCE OF CONFLICTS OF INTEREST AND MISUSE OF FUNDS. >> PARTICULARLY IN THESE TIMES NOW WITH THE ECONOMY BEING THE WAY IT IS, PEOPLE ARE REALLY CONCERNED ABOUT GOVERNMENT RESOURCES BEING USED APPROPRIATELY. AND I DEFINITELY UNDERSTAND WHY PEOPLE ARE CONCERNED OR AT LEAST QUESTIONS THE USE OF FEDERAL FUNDING. AND IN TERMS OF DEALING WITH THE APPEARANCE OF CONFLICT OF INTEREST, I MENTIONED EARLIER THAT CONFLICTS OF INTEREST ARE ALWAYS ABOUT APPEARANCE. VIA PERCEIVED OR ACTUAL. IT'S INCUMBENT UPON THE GRANTEE TO BE SURE THAT ANY PERCEIVED CONFLICT OF INTEREST IS APPROPRIATELY DOCUMENTED AND COMMUNICATED SO THAT THE DETERMINATION CAN BE MADE IF THAT CONFLICT APPROPRIATE, ALWAYS IN TERMS OF SUGGESTIONS ALWAYS OPERATE ABOVE BOARD, BE SURE THERE'S A WRITTEN VERIFIABLE PROCESS IN PLACE SO IF ANYONE SHOULD EVER HAVE TO TAKE A LOOK AT THE PERCEIVED CONFLICT. THEN THERE'S NO QUESTION THERE, MEANING THE WAY YOU DEAL, THE WAY YOU SELECT THE PERSON FOR A CONTRACT IS DOCUMENTED IT'S LAID OUT. THE PROCESS IS FAIR AND ABOVE BOARD. NO ONE CAN QUESTION EVEN IF IT LOOKS TO BE A CONFLICT OF INTEREST THAT THE PROCESS WAS NOT FAIR. AND YOU KNOW AND DOCUMENTED. >> SO WHAT I'M HEARING IS KNOW THE RULES, FOLLOW THE RULES, DOCUMENT THE FACT THAT YOU ARE FOLLOWING THE RULES, AND MAKE SURE THE WAY YOU DOCUMENT IT IS VERIFIABLE? >> YES, LET ME ADD ALSO, BORIS, PART OF THAT LAST QUESTION WAS INFORMING THE PUBLIC AND MAKING SURE THE TAXPAYERS KNOW WHAT'S GOING ON WITH THEIR MONEY WHICH IS AN IMPORTANT PART OF THE PROCESS AND I POINT TO THE RECOVER ACCOUNTABILITY TRANSPARENCY BOARD, WEB SITE AND SOME OF THE NEW PENDING LEGISLATION TO MIMIC THAT DATA TRACKING. USA SPENDING, SOME OF THE OTHER DATABASES THAT ARE OUT THERE THAT WILL ALLOW EVERY TAXPAYER TO KNOW WHERE EVERY ONE OF THEIR TAX DOLLARS ARE GOING, DOWN TO THE ZIP CODE, DOWN TO THE PARTICULAR LOCALITY WHERE THEY ARE. BECAUSE THE MORE PEOPLE ARE AWARE OF WHERE MONEY IS USING AND WHAT IT'S USED FOR, THE HIGHER THE PROBABILITY WILL BE USED PROPERLY. THAT REALLY GOES TO THAT MISUSE OF FUNDS QUESTION, I THINK THAT THE LAST PERSON HAD. >> YEAH, THATIA I GOOD POINT YOU RAISE. THERE'S A BIG THRUST IN GOVERNMENT TO MAKE THESE ISSUES TRANSPARENT AND THERE ARE NUMEROUS WEB SITES RUN BY THE FEDERAL GOVERNMENT THAT DETAIL GOVERNMENT EXPENSES ALL THE WAY DOWN TO THE LOCAL LEVEL. SO I WOULD ENCOURAGE PEOPLE TO ACTUALLY LOOK AT THESE WEB SITES AND FOLLOW THESE ISSUES THAT YOU CAN ACTUALLY SEE HOW THESE GRANTS ARE BEING USED. >> NOW HERE'S A FOLLOW UP QUESTION IN REGUARD TO TIME SHEETS. IN REFERENCE TO TIME SHEETS, TO RECORD GRANTEES AND SUBGRANTEES DONE, WOULD YOU PLEASE ADDRESS THE LEVEL OF DETAIL THAT SHOULD BE GATHERED UP, UP FRONT THAT SHOULD MAKE REPORTING DETAILS LATER ON. WHAT TYPES OF DETAIL SH'S BE OBTAINED? >> I THINK THE BEST WAY TO ANSWER THAT QUESTION IS IS TO REMIND THE VIEWER AND EVERYONE ELSE, THAT THE PURPOSE OF A TIME SHEET IS TO BUILD UP AND TO SUPPORT A CLAIM ON THE PERSONNEL COST CLAIMS. SO I GUESS UPFRONT WE WANT TO GADGETSER WHO IS GOING TO BE CLAIMING--GATHER WHO IS GOING TO BE CLAIMING THIS? WHAT IS THE RATE? IS IT A LEGITIMATE RATE? WHAT ARE THEY GOING TO BE DOING? I WOULD ALSO POINT THEM TO THE OMB CIRCULAR, THE CFR NOW THAT TELLS YOU IN DETAIL WHAT IS ADEQUATE AND SUFFICIENT DOCUMENTATION BECAUSE IT'S NOT--IT'S NOT TOO CUMBERSOME, BUT IT IS PREDETAILED IN THE FACT THAT WE HAVE A NAME, WE NEED TO HAVE A RATE. WE NEED TO HAVE SOME SYSTEM TO INSURE THAT WHAT THEY--WHAT THEY CLAIM THEY DID IS WHAT THEY ACTUALLY DID. SO GOOD JUST PREPARATION UP FRONT AND THE GOOD THOUGHT ABOUT THE PROCESS IS THE MOST IMPORTANT PART OF OF THAT IN ADDITION TO THE FACT THAT ANYONE IS GOING TO BE ULTIMATELY CLAIMED TO A FEDERAL RAMP PROGRAM OR THROUGH A PASS THROUGH HAS TO BE ABLE TO STAND ON THE PHONE IF THERE WOULD BE AUDITED EXAMININED OR INVESTIGATED, THERE'S GOT TO BE SUPPORTING DOCUMENTATION THAT'S ADEQUATE TO SHOW THAT THIS IS A LEGITIMATE CLAIM AND THIS IS A VERIFIABLE CLAIM. >> AND CFR, KEN IS THE-- >> CODE OF FEDERAL REGULATIONS FOR WHICH THE OMB CIRCULARS GAVE ALL THE GROUND RULES FOR GRANT PROGRAMS. THOSE HAVE BEEN CODIFY INDEED THE CODE OF REGULATIONS. >> AND THAT'S AVAILABLE TO EVERYONE? >> YES. >> YES. >> IT'S PART OF MOST GRANT AGREEMENTS. >> OKAY, THANK YOU. HERE'S ANOTHER QUESTION FROM THE VIEWER: COULD YOU EXPLAIN HOW THE GRANTS.GOV PROCESS FOR VALIDATING CCR REGISTRATION WILL CHANGE AFTER AUGUST 9th? >> THANK YOU FOR THAT QUESTION. THAT'S A QUESTION THAT I CAN ANSWER. >> THE CCR IS A VERY IMPORTANT STEP IN APPLYING FOR A GRANT. THE GRANTS POLICY FOR THE FEDERAL GOVERNMENT AND OMB RULES REQUIRES THAT A GRANT APPLICANT BE PREREGISTERED AND HAVE AN ACTIVE CCR REGISTRATION PRIOR TO BEING ABLE TO APPLY FOR A GRANT. WHAT HAPPENS ON AUGUST THE NINTH IS THAT GRANTS.GOV WILL DO A CHECK IN REALTIME ONCE A SUBMISSION IS MADE THROUGH GRANTS.GOV FOR A GRANT TO VALIDATE THAT THE GRANT APPLICANTS, CCR REGISTRATION IS ACTIVE. THIS IS A VERY BIG CHANGE IN HOW WE OPERATE. THE CCR HAS BEEN AN ISSUE IN THE PAST. NOT MANY PEOPLE UNDERSTAND THE CRITICALITY AND THE TIME LINES INVOLVED WITH GETTING A CCR REGISTRATION AND I WOULD URGE BOTH GRANT MAKING AGENCIES AND BUSINESS BOCs TO LET THEIR STAFFS KNOW HOW IMPORTANT IT IS THAT A CCR APPLICATION IS MAINTAINED. AND OF COURSE, IF YOU HAVE ANY QUESTIONS ON THIS, FEEL FREE TO GET BACK TO US. HERE'S ANOTHER QUESTION: WE HAVE AN INDIRECT COST RATE, BUT IT HAS NOT BEEN UPDATE INDEED YEARS. SHOULD WE DO ANYTHING TO ADDRESS THIS PROBLEM? >> WANT ME TO TAKE THAT? >> SURE. >> ABSOLUTELY. THIS IS A RED FLAG. IT'S GOOD THAT THE VIEWER HAS IDENTIFIED THAT THEY HAVE A POTENTIAL PROBLEM AND AGAIN THE INDIRECT COST RATES, GRANTEES THE RESPONSIBILITY IF THEY'RE GOING TO USE THOSE TO MAKE SURE THEY'RE ACCURATE, THEY'RE CALCULATED PROPERLY, THEY'RE JUST ADJUST NECESSARY AS AND THEY'RE APPLIED PROPERLY SO I WOULD ENCOURAGE THAT PERSON TO IMMEDIATELY FIND AN ACCOUNTANT, CPA, COMPTROLLER, SOMEONEOT FISCAL SIDE TO GET SOME ASSISTANCE WITH THIS BECAUSE THEY COULD BE SHORT IN THE GOVERNMENT, THEY COULD BE SHOOF THING THEMSELVES--SHORTING THEMSELVES BUT THEY HAVE TO MAKE SURE IT'S A LEGITIMATE AND REASONABLE RATE AND GET IT FIXED BEFORE IT BECOMES A BIGGER PROBLEM. >> THANK YOU: ANOTHER QUESTION, I'M AWARE OF A GRANT FUNDED ORGANIZATION THAT PLAYS VERY FAST AND LOOSE AT THE RULES, I DON'T WANT TO GET INVOLVED. WHAT CAN I DO? >> REPORT IT. I SPOKE EARLIER ABOUT THE RESOURCES CAN YOU USE TO CONTACT AND REPORT INSTANCES OF FRANT FRAUD, AND WE ENCOURAGE THE PUBLIC, EMPLOYEES OF THE ORGANIZATION AND THE THE GRANTEES THEMSELVES TO REPORT THEM WHEN THEY COME ACROSS THAT SITUATION. IF THEY DON'T WANT TO GET INVOLVED. WE SIMPLY ASK FOR THE INFORMATION, YOU CAN REPORT IT ANON MOUSILY WITHOUT GIVING YOUR NAME. WE SIMPLY ASK THAT YOU PROVIDE AS MUCH DETAIL AS POSSIBLE SO WE IN THE I. G. COMMUNITY CAN LOOK INTO IT. >> AND THE I. G. FOLLOWS UP ON EVERY ISSUE THAT IS BROUGHT TO THEIR ATTENTION. >> WE RECEIVE A LOT OF COMPLAINTS AND WE TRY TO LOOK INTO EVERY ISSUE SOME WE RECEIVE. >> ANOTHER ONE FOR YOU GENTLEMAN, EITHER ONE OF YOU, WE USE GIFT CARDS IN OUR GRANT FUNDED PROGRAM, ARE THERE ANY SPECIAL MEASURES WE SHOULD TAKE REGUARDING THESE ITEMS? >> YES, THE KEY HERE IS THAT IF A GRANT FUNDED ORGANIZATION USES GIFT CARDS THEY SHOULD TREAT A $50 GIFT CARD AS A 50-DOLLAR BILL. TREAT THOSE GIFT CARDS AS THEY ARE CASH AND WHAT THAT MEAN SYSTEM YOUR HAVE YOU HAVE YOUR SEPARATION OF DUTIES AND STORES THEM, COUNTS THEM, DOES INVENTORY, DISPURSES THEM AND ACCOUNTS FOR THEIR PROPER USE AND THOSE WILL BE DIFFERENT PEOPLE AND SEPARATION OF DUTIES SO YOU DON'T HAVE ANY ONE PERSON MANAGING THOSE BUT IT'S CRITICALLY IMPORTANT THAT PEOPLE TREAT THOSE CARDS JUST AS KITCHEN BECAUSE IT'S REALLY WHAT THEY ARE. A $50 GIFT CARD THAT GOES UNACCOUNTED FOR IS A MISSING $50 YOU'RE NEVER GOING TO SEE AGAIN. SO THE GRANTEES WHETHER THEY'RE GIVING THEM TO STUDY PARTICIPANTS OR DOMESTIC VIOLENCE VICTIMS OR MENTORS, THEY HAVE TO CAREFULLY HAVE A PLAN FOR HOW THEY HANDLE THEM AND HANDLE THEM JUST LIKE THEY'RE CASH. >> THANK YOU. >> ANOTHER QUESTION: >> MY ENTITY IS SMALL AND WE DO NOT HAVE THE RESOURCES OR SKILLS TO DO ALL THE ACCOUNTING REQUIRED BY THE REQUIREMENT? >> , AND SO THEY DON'T HAVE THE KAS PATE APPROXIMATE HEALTH, THEY SHOULD CONSIDER RECEIVING OBTAINING THE SERVICES OF OF AN ORGANIZATION, LIKE A FISCAL AGENT OR A CP A R OR AN ACCOUNTANT. OR THEY CAN CONSIDER HAVING SOMEONE WHO IS A MEMBER OF THEIR OVERSIGHT COMMITTEE, THE BOARD OR THE TRUSTEES, SOMEONE WITH EXPERTISE IN THAT EXPERIENCE ON THE BOARD WHO CAN ALSO PROVIDE ASSISTANCE TO THE ORGANIZATION. >> WELL, THANK YOU. THAT IS VERY INTERESTING, GOES BACK TO WHAT YOU'RE SAYING EARLIER ABOUT IF YOU DON'T HAVE THE SKILL SET OOH QUIRE IT, MAKE SURE YOU GET IT RIGHT. AND I THINK THAT'S GOOD ADVISE. NOT ONLY FOR THE GRANTS WORLD BUT MY WORLD AS WELL. WE HAVE ANOTHER QUESTION HERE. I THINK I HAVE A RELATED PARTY TRANSACTION, WHO SHOULD I REPORT THIS TO? >> WELL, RELATED PARTY TRANSACTIONS OF COURSE COME BACK TO THE ISSUE WE DISCUSSED EARLIER, ABOUT CONFLICTS OF INTEREST AND THEY THERAPIST SHOULD BE REPORTED TO THE COUNCIL FOR THE ORGANIZATION, IF I HAD A BARE MINIMUM IT SHOULD BE DISCUSS WIDE THE PROGRAM OFFICE AWARD GRANT. THIS IS A SITUATION THAT IF IT'S NOT BROUGHT TO THE ATTENTION, OTHER PROGRAM OFFERERS COULD LEAD TO PROGRAMS FOR THE GRANTEE ORGANIZATION IF IT COMES TO LIGHT AFTER THE FACT. >> THANK YOU. >> LET ME ADD TO THAT BORIS, CONFLICTS OF INTEREST ARE ONE OF THOSE THINGS THAT ARE VERY, VERY AVOIDABLE, PREVENTIBLE, IF PEOPLE JUST GIVE FORETHOUGHT TO IT BECAUSE THERE ARE A LOT OF SITUATIONS THAT COULD BE CONFLICTS OR COULD CAUSE PROBLEMS AND IF GRANTEES LIKE THIS ONE ASKING THIS QUESTION IF THEY ADENTIFY POTENTIAL ISSUE IN AND DISCLOSE IT TO PEOPLE IN WRITING,ENTIOUS SPECIALLY SAY WHAT DO I DO, WHAT DON'T I DO, THEY ARE VIRTUALLY GUARANTEEING THEMSELVES OF STAY NOTHING TROUBLE IN THIS AREA. SO IF YOU DISCLOSE THE POTENTIAL PROBLEM AND GET THAT ADVICE, FOLLOW THAT ADVICE, ALL OF A SUDDEN THAT IS NOT GOING TO BECOME AN ISSUE OR PROBLEM ANYMORE AS LONG AS YOU ARE HONEST THROUGHOUT THAT PROCESS. >> THAT'S GOOD ADVICE, THAT'S THE BEST I FOLLOW IN MY DAILY LIFE. >> WELL, HERE WE HAVE ANOTHER QUESTION. AFTER WE WERE AWARDED OUR GRANT, WE HAD MAJOR CHANGES IN OUR PROGRAM. WE RECEIVED UNEXPECTED FUNDING FOR ANOTHER SOURCE AND CHANGE THE SCOPE OF OUR RESEARCH. DO WE HAVE ANY OBLIGATION TO REPORT THIS TO THE FUNDING AGENCY? >> SIMPLE ANSWER IS YES. THE REASON BEING BECAUSE WHEN YOU SUBMIT THE GRANT APPLICATION, THE GRANTEE SUBMITS THE GRANT APPLICATION, THEY SAY WHAT THEY WILL DO WITH THE PROGRAM AND THE GRANTEE ORGANIZATION EXEC FOR THEM TO TAKE THAT ACTION AND DO WHAT THEY SAY THEY'RE GOING TO DO. IF THE GRANTEE MAKES MATERIAL CHANGE TOTS RESEARCH DEAL THAT THEY'RE CONDUCKING OR WHATEVER THE ACTIVITY IS FOR WHICH THEY WERE FUNDED, THEY HAVE TO NOTIFY THE GRANTEE ORGANIZATION AND THE GRANTEE ORGANIZATION HAS TO APPROVE THOSE CHANGES SO YES IT'SINANT THAT INFORMATION IS COMMUNICATED TO THE GRANTEE ORGANIZATION, AS SOON AS THEY REALIZE THEY MAY NEED TO MATERIALLY DEVIATE FROM THEIR INTENDED PLAN. >> WELL, THANK YOU BRANDON AND KEN, THANK YOU GENTLEMAN. AND I'D LIKE TO THANK THE AUDIENCE FOR YOUR ATTENTION. WE APPRECIATE YOUR PARTICIPATION, ATTENTION THROUGHOUT OUR PRESENTATION AND TO THE THE ROUND TABLE DISCUSSION. UNFORTUNATELY, WE'RE OUT OF TIME FOR TODAY'S SESSION. I WOULD LIKE TO THANK AGAIN KEN DIEFENBACH, AND BRANDON TRIESS, FOR THE LIVELY DISCUSSION AND SHARE WAG WE HOPE IS VALUABLE INFORMATION WITH YOU TODAY. WE ALSO WANT TO THANK THE FEDERAL AGENCIES AND THE GRANT APPLICATIONSLICANTS FOR OF THE SUPPORT AND PATIENTS THROUGH A VERY DIFFICULT TRANSITION ON THE AIR. THE GRANTS.GOV STAFF IS STRONG AND WILL CONTINUE TO IMPROVE UPON GRANTS.GOV SERVICE THROUGH STAKEHOLDERS GOING FORWARD. AGAIN, THANK YOU FOR JOINING US AND PLEASE VISIT OUR WEB SITE AT GRANTS.GOV. THAT'S WWW.GRANTS.GOV. FOR CONTINUOUS PROGRAM UPDATES. IF YOU WOULD LIKE TO VIEW THIS WEBCAST AGAIN. PLEASE GO TO OUR HOME PAGE AND CLICK ON THE WEBCAST LINK UNDER WHAT'S NEW AT GRANTS.GOV. THIS LINK WILL TAKE YOU DIRECTLY TO THE PRESENTATION. THANKS AGAIN AND HAVE A GREAT DAY! [* MUSIC ]