What to Do After Receiving Federal Funding: A Guide for Subrecipients

Receiving federal funding is a milestone achievement for organizations as it opens the door to expand services, enhance programs, and meaningfully impact communities. However, federal funds have mandatory accountability requirements that are managed throughout the grant’s lifecycle for compliance and sustainability. Navigating this process can be complex and requires structured approaches to risk assessment, effective monitoring, and diligent compliance practices to remain in good standing with federal requirements and for future eligibility. This guide walks you through the steps after receiving federal funding to remain compliant and maximize your grant’s impact. 

Understanding Federal Funding Benefits and Responsibilities 

Federal grants provide a solid foundation for expanding program reach, building capacity, and meeting local community needs. Federal funding is available to various entities, including nonprofit organizations, state and local governments, educational institutions, medical facilities, research institutions, and tribal organizations.  

However, as a subrecipient, your role involves carrying out federal programs while adhering to strict regulations, proper planning, risk management, and communication necessary for a successful grant lifecycle. 

Initial Steps to Compliance  

After receiving federal funding, subrecipients should prioritize a structured approach for compliance and effective program management. The first three critical steps are as follows: 

Conduct a Risk Assessment 

Evaluate your organization’s readiness to manage the grant. Identify areas that need attention, such as financial practices, staffing, and compliance requirements with federal guidelines. If your organization is new to federal funding, prioritize training and technical assistance to bridge knowledge gaps.  

Develop a Grant Management Plan 

Create a structured plan to monitor your programmatic and financial spending activities. This plan should include timelines, roles, and responsibilities for key tasks such as reporting, compliance checks, and performance evaluations.  

Establish Communication Channels and Expectations 

Effective communication with funders, internal teams, and stakeholders sets the stage for transparency and clarity. Set expectations regarding reporting intervals, documentation requirements, and updates early on. Clear communication mitigates misunderstandings and keeps all parties aligned with the grant objectives and requirements. 

Critical Steps to Safeguard Compliance 

For the success of your project and to maintain compliance, take proactive steps right from the start. Federal grants come with their own set of complex rules and expectation, and your ability to navigate these efficiently can determine your long-term success. 

Monitoring throughout the grant lifecycle is essential, particularly in post-award phases where federal requirements are more intensive. Effective monitoring helps align a project with approved objectives, maintain financial integrity, and adhere to federal guidelines.  

Effective monitoring practices include: 

1. Thoroughly review award documents: This step is essential, though it may appear straightforward. Your Subaward Agreement outlines your responsibilities, reporting requirements, and deadlines. A thorough review of the agreement is crucial to successfully launching the grant.
2. Technological integration: Grant management software supports tracking, reporting, and retaining grant data, simplifying the monitoring process. Integrating technology improves accuracy, enhances data security, and reduces the administrative burden.
3. Regular financial audits: Periodically review financial records to verify that funds are being used appropriately and are accurately documented.
4. Site visits: Conduct on-site evaluations to verify that the program’s activities align with grant objectives and put compliance first.
5. Performance tracking: Monitor progress toward goals with performance metrics outlined in the grant agreement.
6. Internal control checks: Create a comprehensive guide that features compliant policies and procedures while making sure that internal controls are in place. These components guide day-to-day operations and safeguard your organization from potential financial and compliance risks.
7. Stakeholder and funder feedback: Respond promptly to requests for information and proactively report significant changes in project scope, budget, or key personnel. This supports transparency, open communication, and continued alignment with grant requirements and strategies.
8. Quarterly compliance reviews: Conduct compliance reviews to track adherence to federal guidelines, particularly Uniform Guidance (2 CFR 200). 

These monitoring practices can help subrecipients stay audit-ready and address potential compliance issues early for a smoother closeout process. 

Leveraging Best Practices During Grant Closeout 

By implementing best practices and proactive planning, subrecipients can streamline the closeout process, minimize potential issues, and maintain a positive relationship with funding agencies. To aid in pre- and post-closeout, organizations can follow these four key principles.  

Starting Grant Program Closeout 

Begin your closeout process early and plan for adequate time to collect all programmatic, administrative, and fiscal documents and data before the submission due date, typically 120 calendar days after the end of the performance period.  

Enhanced Compliance Requirements 

Stay up-to-date with Uniform Guidance and agency-specific regulations. Following these guidelines from the start helps avoid last-minute closeout issues. 

Data Security & Retention 

Prioritize sensitive financial and programmatic data security during closeout, securely store documents, and adhere to data retention policies. 

Conduct a Closeout Evaluation 

Assess the overall effectiveness of the grant program and document lessons learned for future projects. 

Managing federal funding can be complex, but you don’t have to navigate it alone. EisnerAmper professionals have deep experience in risk assessment, monitoring, training, and compliance to help equip your organization to confidently handle every stage of the grant lifecycle. Contact us below to get started.