DISASTERRECOVERYTODAY. COM D I S A S T E R R E C O V E R Y T O D A Y • If a contractor is in violation of a contract, the applicant should address the issue formally and then document it in the appropriate PW file. • If a contractor performs any services outside of the FEMA- approved scope of work, those costs must be segregated and invoiced separately. • When possible, before letting a large contract (where FEMA funds will be used), applicants should gain approval from the state. • When dealing with FEMA disaster-related contracts, contractors must provide a greater level of detail on their invoices than normal. Tip #7: Check Parameters of Official Accounting Systems In addition to creating and maintaining a clear audit trail, adequate source documentation, and an acceptable filing system, all eligible costs must be reconcilable to the official accounting records of the applicant. The approach taken to document and summarize eligible costs will determine the amount of reconciliation required. Some institutions’ accounting systems may not be capable of tracking costs at sufficient levels of detail to support a disaster recovery program. In that case, all or part of the disaster program costs must be tracked outside the official accounting system—but must remain reconcilable to it. Other institutions’ accounting systems may effectively support a disaster recovery program. This type of system can provide cost accounting that can track by disaster site and segregate eligible and ineligible costs. The former approach would require a significant amount of reconciliation, while the latter may require none. Tip #8: Track Deadlines and Extensions Title 44 of the Code of Federal Regulations (44 CFR) imposes deadlines for many disaster response and recovery activities undertaken by FEMA grant applicants. Deadlines are delineated for submitting the Notice of Interest, for identifying damage, for completing work, and for filing appeals, to list a few. Please note that certain deadlines can be further extended, if justified by the disaster. A special request from the state (acting on the applicant’s behalf) to FEMAmust be submitted, and, of course, the notice of approval properly saved to the appropriate file. Summary The FEMA grant process requires sound management from beginning to end. Plan and prepare for the closing of your projects, and never assume that you have too much information. If the auditors open detailed, well-organized project files, they will be able to answer their questions with minimal effort and inquiries—and then move on to the next file and, eventually, the next applicant. Staying ahead of documentation requirements will keep your FEMA grant intact, and assist with the smooth completion and closeout of your project. Remember, nobody understands what was done, why it was done and how it was done better than the applicant. Successful closeouts and audits hinge on your ability to articulate these items, and nothing speaks louder than clear, concise documentation. CORPORATE OFF ICE 126 Business Park Drive Utica, New York 13502 1-800-382-2468 Outside U.S. (315) 797-3035 FAX: (315) 272-2054 [email protected] PUBL ISHER Ronald A. Cuccaro, SPPA EDI TOR Sheila E. Salvatore WEB ADDRESSES www.adjustersinternational.com www.disasterrecoverytoday.com DISASTER RECOVERY TODAY is published as a public service by Adjusters International, Inc. It is provided for general information and is not intended to replace professional insurance, legal and/or financial advice for specific cases. DRC05-3 4007 PRINTED ON RECYCLED PAPER Copyright © 2007 Adjusters International, Inc. Adjusters International ® and the AI logo are registered trademarks of Adjusters International, Inc. All rights reserved. Jeff Shaw Adjusters International
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