The emergency response following a disaster may last only a few days or weeks, but the post-disaster recovery is typically a much longer process. Depending on the severity of the event, cost-recovery may last for a decade or more.
FINANCIAL RECOVERY & RECONCILIATION
After a disaster, financial recovery and reconciliation are essential, yet nothing is quite what it seems. Records, inventories, supply chains, warehouses, and places of business may be damaged or destroyed. Even if fully intact, claimed cost-supporting documentation will need to align with the summary level data generated by financial systems.
As a condition of receiving a grant, most federal departments and agencies mandate specific minimal standards in financial management that a jurisdiction must have the capability to follow, including preparing reports, tracing funds, and demonstrating internal control and accountability for all cash, personal property, and other assets.
Hagerty professionals know the financial recovery and reconciliation processes very well — we know the regulations, forms, codes, and everything else about how to comply with the process and make it work to your advantage to minimize the disaster impacts on your organization.
ACCOUNTING & INTERNAL CONTROLS
To receive federal assistance after a disaster, certain organizational accounting and internal controls need to be in place before any funds are transferred. Some requirements include qualified and adequate numbers of staff, as well as a fiscal accounting system that can track specific projects, prepare for and undergo audit, and be used to evaluate appeals.
As such, after a disaster, records must be maintained to verify the money was used for eligible work and completed in a manner compliant with Federal Emergency Management Agency (FEMA) regulations and project-specific requirements. FEMA requires all submitted costs to be reviewed and will request explanations for any discrepancies between the amount of the existing funds available and the invoices submitted. These are requirements necessary to retain all awarded funding through grant closeout, and noncompliance can put that funding at risk for de-obligation or clawback.
Hagerty knows FEMA’s rules, regulations, and practices. With skill and tact, our professionals will show you how to implement the accounting and internal controls your organization or jurisdiction needs. We did it in New Orleans as part of the Hurricane Katrina recovery. Read about this successful project here.
FEDERAL GRANTS AND LOAN MANAGEMENT
The federal government and related agencies make available billions of dollars each year in the form of grants and loans. They are effectively looking for qualified applicants who can meet their requirements, complete their application process, present a worthy project or program for funding, and abide by their rules if the grant or loan is approved. Federal financial management is the practice of overseeing grants made by the federal government to satisfy the statutory requirements and ensure successful delivery and performance of the grant purpose.