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Pre-Award Risk Assessment Under the Super Circular

Federal agencies have always had the authority to evaluate the level of risk a grantee represents before making a grant award. But with the advent of the Super Circular, pre-award risk-assessment requirements are more detailed and explicit.


In keeping with 2 CFR 200.205, federal granting agencies will now routinely evaluate your organization’s past performance, audits, and integrity prior to making an award.


“With potential federal funders taking a closer look at your organization, now’s the time to attend to any lingering housekeeping issues,” said Henry Flood, senior advisor for grant administration at The Grantsmanship Center in Los Angeles, Calif. “Be proactive.”


Flood advises that you monitor information about your organization that’s posted in the System for Award Management (SAM). Avoid delinquent program reports and audits. Review spending patterns on current federal grants to confirm that draw-downs and expenditures are in line. Review financial systems and take every step to avoid adverse findings. Know your organization’s strengths and weaknesses and mitigate the weak points where possible.


Be sure to keep the standard assurances in mind when developing the budget for a federal proposal. In some instances those assurances that must accompany every federal application can impose substantial compliance burdens and risks to your organization. For example, certifications concerning environmental, relocation, human subjects, and animal welfare can be costly. It’s critical to include such costs in the proposed budget or to account for them separately if they are ineligible for funding consideration. Failing to do so increases the risk associated with your proposal.


Closely assess the risks your project might pose for the federal funding agency. For example, if there’s a possibility that your project could impact cultural or historic sites, it will be essential to prepare a proper mitigation plan and comply with related documentation requirements. You need a full understanding of the risk your project will present in order to determine whether or not to move it forward.


The increased focus on risk assessment will keep applicant organizations on alert. “That’s not a bad thing,” said Flood. “The new environment means that organizations must be diligent, consistent, and detailed in their management practices. That’s a recipe for grant management success.” © Copyright 2016 The Grantsmanship Center.

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