Completion, Inspection and Audit

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The inspector(s) also require access to documentation related to the actual expenditures and scope of work, including:

• • Appropriate building permits;
• • Correspondence or evidence of environmental/historic review or permits;
• • A copy of proof of insurance, or waiver;
• • Copies of bid documentation and proof of payment for all contracted work, including procurement procedures/ solicitation, bidders list with a summary of bids, applicable bonds, contracts and change orders;
• • Summary schedules and backup for force account labor costs.

During the site inspection, the inspectors gather the information required to produce a Final Inspec- tion Report (FIR). The state then submits this report to FEMA. FEMA reviews the FIR and re- quests any additional information deemed necessary. When FEMA is satisfied that the stated objectives have been met, an approval letter is sent to the state. In turn, the let- ter is forwarded to the applicant. If any cost adjustments are required, FEMA prepares a supplemental PW or “version.”

This final PW version is then obligated, and applicant funds are credited or debited. The ap- plicant signs a final certification, the Governor’s Authorized Repre- sentative countersigns, and FEMA closes the grant.

Final Audit

Audits are the last hurdle of the Public Assistance process. Audit requirements, found under the Single Audit Act of 1984 (P.L. 98- 502), cover all federal assistance received by the state or local gov- ernment.

An audit is conducted by the state to ensure that all disaster costs are reconciled. A final audit is nor- mally initiated based on certain monetary thresholds, or if there are discrepancies in the source documentation that supports an applicant’s accounting of costs.

The audit process is a formal process with an entrance and exit conference. Auditors require access to cost summaries, original source documents, and other important financial records.

They complete an in-depth review of an applicant’s accounting func- tions to document and substantiate disaster-related costs. This com- pares to the random sampling of source documentation carried out during final inspection.

The results of the final audit are forwarded to the FEMAOffice of the Inspector General (OIG). A special purpose review or investi- gation is performed when unusual information about an applicant’s project is detected.

Although an audit is normally a state process, FEMAmay elect to conduct a program audit of cer- tain grants through the OIG. OIG...

Closeouts and audits may occur several years after an event, and in some cases due to normal attrition, those staff members involved in the original disaster recovery process may no longer be available to defend the applicant’s actions.