Grants Fiscal Monitoring and Single Audit Compliance

State agencies that provide grant funding must monitor those grants to ensure funds are used as intended and that they comply with laws, regulations and the provisions of the grant agreement (contract).

HHS is committed to good stewardship of public resources. The Compliance and Quality Control Fiscal Monitoring Unit (FMU) and Single Audit Unit (SAU) teams help grantees comply with their contracts.

Fiscal Monitoring Review and Compliance Checklist

FMU monitors certain grantees for compliance and refers and coordinates suspected fraud, waste or abuse to the HHS Office of Inspector General. FMU also provides technical assistance for financial compliance and maintains a record of unit work performed and the results obtained.

The main objective of the fiscal monitoring review is to make sure grantees follow applicable state and federal regulations, all applicable HHSC policies, procedures and rules, and the provisions of the contract.

The Fiscal Monitoring Review Checklist (PDF) details the types of documents and information that may be requested during the review period. It also covers important requirements before and during a review.

FMU Frequently Asked Questions (PDF) includes answers to some common questions you may have about the review process.

The three stages to a fiscal monitoring compliance review include:

  • Planning: Starts six weeks prior to the review. Grantees receive a Request for Information (RFI) document along with a letter from FMU that confirms the dates of the upcoming fiscal monitoring review. The RFI will include the specific grants, periods and documents needed for the review.
  • Testing: A review week is dedicated to the testing of payroll, expenditures, match, program income and quarterly financial reports to the general ledger reconciliation. FMU will send out samples of what is being testing and any information that will be required during the review week.
  • Reporting: If FMU identifies findings and/or questioned costs during a fiscal monitoring compliance review, then the grantee will have the opportunity to provide explanation and/or corrective action plan(s) during the initial report phase. The final report phase will include the grantee’s responses from the initial report. If the questioned costs identified in the initial report are not resolved in time for the final report, they will become disallowed costs.

Fiscal monitoring reviews are limited to issues of fiscal compliance and do not evaluate the overall program objectives.

Learn more about fiscal monitoring and the FMU team (PDF).

For questions about fiscal monitoring, email FMU.

Compliance with State and Federal Grant Standards for Single Audits

SAU monitors HHS recipients of state funds for compliance with the Texas Grant Management Standards and subrecipients of federal funds for compliance with the Federal Uniform Grant Guidance, 2 CFR 200.

SAU conducts desk reviews of single audit reporting packages and financial statements, communicates with grantees regarding questions or issues, coordinates with program staff when additional follow-up with recipients/subrecipients is required, and maintains a record of work performed.

For answers to common questions about single audit reporting and compliance, read the SAU Frequently Asked Questions (PDF).

For additional questions, email SAU.

Resources