Determining the Type of Grant Financial Review
This document provides guidance on how to determine the type of grant financial review being requested by a sponsoring agency or an external auditor. The type of review depends on the purpose, scope, and timing of the review, as well as the roles and responsibilities of the parties involved. The following are the main types of grant financial reviews:
Audit
An audit is an official financial examination of accounts, typically conducted by an independent body, such as an external auditor, a government agency, or an internal audit unit. Examples of audits include the annual single audit or sponsor audits to review specific aspects of a grant or series of grants.
Sponsor audits may be initiated for various reasons, such as routine monitoring, risk assessment, allegation of noncompliance, or closeout of an award. Sponsor audits may cover a range of topics, such as allowability of costs, adequacy of internal controls, accuracy of reporting, adherence to performance objectives, and protection of intellectual property.
An audit may involve the following steps:
- Sampling of financial/payroll transactions with focus on allowability, allocability, and reasonableness.
- Review of the University's internal controls and systems.
- Issuance of findings and recommendations.
- Resolution of audit issues and corrective actions.
Monitoring Site Visits and Desk Audits
A monitoring site visit is a review of the financial and programmatic aspects of an active award, conducted by the sponsor's grants management or programmatic officials at the recipient's location. The purpose of a monitoring site visit is to ensure that the recipient is complying with the terms and conditions of the award, as well as the sponsor's and the University's policies and procedures. A monitoring site visit may include the following components:
Site/Monitoring Visits: These are conducted by the sponsor's grants management and/or programmatic officials and focus on the financial and programmatic management of the active award. They may cover areas such as payment requests, reporting, day-to-day management, sponsor-specific requirements, and University policies and procedures. Some site visits are done virtually, similar to a desk review.Desk Audit/Review: A desk review is a review of the financial and programmatic aspects of an active award, conducted by the sponsor's grants management or programmatic officials at their own location. The sponsor will request backup documentation for transactions on the project (in full or for a specific timeframe) and review them remotely. A desk review may cover the same areas as a site/monitoring visit, such as payment requests, reporting, day-to-day management, sponsor-specific requirements, and University policies and procedures. Desk Reviews are generally done virtually.
Agency Reviews: These are similar to site/monitoring visits, but they may involve more than one sponsor or agency, such as in the case of joint or collaborative awards.
Invoice or Transaction Reviews: These are requested by the sponsor's grants management official and focus on the detailed backup for the selected invoice(s). They do not require any assistance from the Research Quality Assurance (RQA) group other than consultation.
