Grants monitoring is a vital activity for all federal grants. Monitoring activities performed by federal awarding agencies ensure recipients of federal funds follow the terms and conditions of their awards, as well as applicable regulations and laws of their grant program. Given the differences in grant portfolios across awarding agencies, monitoring 100% of grants may not be feasible; however, awarding agencies should strive to develop and implement standards and activities to identify, mitigate, and even correct grants administration practices for federal award recipients deemed to be high-risk. There is inherent risk in awarding federal funds; as such, the goal is to identify risk as early as possible in the awarding process.

Grants monitoring is proactive

Monitoring federal awards should not start after an award has been made but before. Beginning to monitor before an award is made helps agencies identify recipients’ ability to effectively administer their awards. If a recipient is deemed to be high-risk as a result of pre-award risk assessments, awarding agencies can implement measures designed to mitigate identified risks and help improve recipients’ overall risk standing.

Grants monitoring is corrective not punitive

While the term grants monitoring may seem to carry a negative connotation, it is important to note that monitoring activities are not meant to punish federal funding recipients. The goal of such activities should be to correct any identified risk that, if left unchecked, would adversely affect the success of the administration of the awards.

Grant monitoring provides benefits

Developing and implementing monitoring activities establishes a framework for robust pre-award risk assessments, which provides awarding agencies with information necessary to discern the financial stability of federal funds. Awarding agencies experience immediate benefits by identifying high-risk non-federal entities, collecting non-federal entities’  pertinent financial data to be used for future grants monitoring activities, and complying with applicable federal laws pertaining to grants administration.

In the next post, we will highlight the top grants monitoring activities.