Proposal/Grant/Contract/Commodity Agreement Review Checklist

CARE USA

PROPOSAL/GRANT/CONTRACT/COMMODITY AGREEMENT REVIEW CHECKLIST

THIS CHECKLIST IS INTENDED TO PROVIDE GUIDANCE TO COUNTRY OFFICES AND HEADQUARTERS UNITS IN REVIEWING & PLANNING THE FINANCIAL & ADMINISTRATIVE ASPECTS AND DONOR RELATIONS DURING THE PROJECT DEVELOPMENT AND GRANT/CONTRACT NEGOTIATION PROCESS. WHEN AND WHERE APPROPRIATE, CARE’S PREFERRED BUSINESS PRACTICES SHOULD BE INCORPORATED IN THE PROPOSAL OR OTHER SUPPORTING DOCUMENTATION PROVIDED TO THE DONOR TO AVOID THE INCLUSION OF SPECIFIC CLAUSES IN THE GRANT/CONTRACT THAT WOULD REQUIRE PRIOR APPROVAL FROM EITHER THE REGIONAL DIRECTOR AND/OR THE CONTROLLER. THIS CHECKLIST IS TO BE COMPLETED PRIOR TO SIGNING OF ALL GRANTS, CONTRACTS, AND COMMODITIES WHETHER SUPPLIED BY USAID, USDA OR ANY OTHER DONOR.

BASIC INFORMATION RELATED TO THE GRANT/CONTRACT/COMMODITY AGREEMENT IS TO BE RECORDED IN SUMMARY SHEET, ATTACHMENT C. THE SUMMARY SHEET IS TO BE FORWARDED ALONG WITH THE AGREEMENT TO THE GRANTS, CONTRACTS & DONOR REPORTING GROUP OF THE CARE/USA FINANCE DEPARTMENT IN ATLANTA. THE COMPLETED CHECKLIST IS TO BE FILED IN THE GRANT/CONTRACT FILE AT THE COUNTRY OFFICE (OR HQ UNIT IF THE CHECKLIST IS PREPARED BY A HQ UNIT) FOR FUTURE REFERENCE, TURNOVER PROCEDURES ETC. COMPLETED LONG FORM CHECKLISTS SHOULD BE SUBMITTED TO HEADQUARTERS ONLY IF THE AGREEMENT IS IN A LANGUAGE OTHER THAN ENGLISH.

EVERY QUESTION IS TO BE ANSWERED. IF THE ANSWER TO A QUESTION CANNOT BE DETERMINED BY THE TEXT OF THE GRANT/CONTRACT OR ITS ATTACHMENTS, THE GRANT/CONTRACT SHOULD NOT BE SIGNED UNTIL THE ISSUE IS CLARIFIED IN WRITING. IF ANSWERS TO SOME QUESTIONS REQUIRE FURTHER EXPLANATION, PLEASE ATTACH ADDITIONAL PAGES AS A RECORD TO THE FILE.

GRANT/CONTRACT/COMMODITIES REVIEW CHECKLIST

YES / NO / N/A / NOTES
A. GENERAL
Does the grant/contract contain the following clauses (1-5)?
1. Identification of CARE USA as one of the contracting parties. Please indicate the name used for CARE USA. (If CARE USA is a party, name used should be the Cooperative for Assistance and Relief Everywhere, Inc.).
2. Identification of the Country Office as one of the contracting parties? Please indicate the name used to identify the Country Office in the contract/grant. / If NO, please explain.
3. Adequate identification of the other contracting parties? / If NO, please explain.
4. Identification of the laws that govern the interpretation of the contract/grant. / If NO, please explain.
5. Stated methods for settling disputes. (Prefer mediation.) / If NO, please explain.
6. Is a program description, scope of work, or a project proposal incorporated into the contract/grant? / If NO, please explain.
7. Are procedures for modifying any of the terms & conditions of the grant/contract adequately defined?
8. Is any additional approval or agreement with the host country government required beyond the basic agreement to ensure that all project materials and commodities may be imported duty-free? / If YES, please ensure that written agreement is obtained from the host country government prior to signing the grant/contract.
9. Is the amount of funding and/or commodities to be received and the length of the contract/grant consistent with either the original project proposal or a revised proposal?
a) If NO, can the project objectives stated in the grant/contract be accomplished within the planned timeframe and with the available resources / If NO, please renegotiate the agreement
B. CONTRACTS REFERRED TO IN GRANT/CONTRACT
If the contract/grant refers to other agreements (e.g., an agreement between another CI member and a donor), have you reviewed the underlying agreement against this checklist?. / Often, the terms of the underlying agreement may be incorporated into a CARE USA Country Office contract/grant -- thereby binding the Country Office -- even though neither the Country Office nor CARE USA signed it. If the underlying agreement has not been reviewed against the items in this checklist, it is very important to do that
C. DEFINITIONS
1. Does the contract/grant use any of the following terms without providing an adequate and acceptable definitionacceptabledefinition of the term?
a. Overhead
b. Core Costs
c. Common Costs
d. Fixed Costs
e. Variable Costs
f. Force Majeure / If YES, please clarify this in writing and/or renegotiate with the donor.
2. Does the contract/grant use the terms with a definition different than that used by CARE?
a. Direct Costs
b. Indirect Costs / Please note that CARE considers all costs at the Country Office level to be Direct project costs. Obtain CARE/USA controller approval for any exceptions to this rule in grant/contract agreements.
D. DATES
1. Is the Starting Date (the date on which expenses can first be incurred) adequately defined? / If NO, please explain start date cut-off procedures acceptable to CARE and the donor.
2. Does the contract/grant provide a retroactive Starting Date? (A date prior to the contract/grant signing dates).
a) Are certain obligations required to be satisfied during the time period prior to signing?
b) If YES, have they been, or will they be satisfied? Explain.
3. Is an Ending Date (the last date on which expenses can be incurred) adequately defined? / If NO, please explain end date cut-off procedures acceptable to CARE and the donor.
4. Is the Ending Date an approximation? / If NO, please explain.
5. Is the Ending Date a rigid cut-off?
a) If the Ending Date is a rigid cut-off, are time extensions permitted?
6. Is the application method for a time extension adequately explained?
E. FUNDING & CURRENCY
1. In what currency does the grant/contract provide project funding? / Currency: ______
If the contract/grant commits funding in more than one currency please request multiple fund codes
2. If part or all of the funding is in a currency other than USD, what is the risk that the other currency will depreciate significantly against the USD over the course of the grant?
a) If significant depreciation were to occur, would the CountryCounry Office still be able to meet its obligations and achieve the grant/contract’s objectives? / Please describe:
If NOno, please consider risk to CARE and negotiate appropriate escape clause. If unable to renegotiate, obtain approval of CARE USA Controller.
3. Is the amount of the funding adequately defined? / If NO, please explain how the Country Office will monitor financial performance of the grant and manage CARE’s risk.
4. If some (or all) of the funding is in a currency other than US dollars, in what “case” is that currency used? Case 1,2,3,4,5, or other? (Refer to OFM Chapter 5).
5. Does the contract/grant commit all of the funding and/or commodities immediately? (As opposed to withholding some of the obligation)
a) If not all funding and/or commodities is committed, please explain what must occur prior to the commitment of the remaining funds and/or commodities.
6. List types, quantities and USD value of commodities covered by contract/grant. / Commodity type Qty (MT) USD
7. Indicate whether part of the commodities are for monetization.
a) If YESyes, has the agreement with the buyer been cleared by the donor ? / Qty in MT:
If NOno, please explain:
F. MATCHING REQUIREMENTS
1. Does the contract/grant require that the project be partially funded or commodities supplied by other sources? (Required Match).
2. Is the minimum amount of required match and the timing of the match adequately defined in the grant/contract? / If NO, please renegotiate this item before signing.
3. Does the grant/contract commit CARE to providing funds/assets above the usual minimum match requirements of the funder? / If YES, please attach a justification for agreeing to more than the minimum and obtain concurrence of the Regional Director before signing if the match will or may require the allocation of unrestricted CARE/USA funds.
4. Are there any restrictions on the sources of the required match? / If YES, please describe
5. Can Contributions-in-Kind be used to
meet the required match? / If YES, please describe how the Country Office will record these CIKs and report on them
68. If a match is required, does the donor allow unrecovered indirect costs to be included as part of the match?
a) If YESyes, please ensure that the budget correctly presents indirect costs to direct project implementation costs / If NO, and CARE/USA provides (part of) the match from CARE/USA private donor funds, please renegotiate this item with the donor, or obtain CARE/USA Controller permission before signing..
7. If the match is for monetization:
a) Must CARE match the commodities prior to monetization?
b) Are commodities already secured for match? / If NO, please explain.
7. Has the source of the required match been identified?
a) If YES, please describe. and include reference to previous quarterly funding pipeline.
. / If NO, please describe the plan to meet the match requirements. If the match requires uncommitted CARE/USA funding (whether unrestricted or private restricted), please obtain approval from the Regional Director.
G. PROGRAM INCOME AND/OR REVOLVING FUND ESTABLISHMENT
1. Will the project generate program income reflows and/or require the establishment of any type of revolving funds?
a) If YESyes, is the use and/or disposition of these funds during the life of the project adequately described in the grant/contract? / If NOno, please clarify with donor prior to signing.
If YESyes, please determine if additional fund code is required (in case of revolving fund) and select appropriate accounting method.
2. Is the use of Program Income permitted as a source of matching funds? / If YESyes, Country Office should determine the amount of Program Income to be included in proposal that offers optimum benefit/risk for matching purposes.
3. Does the contract/grant adequately define the disposition, or the process to determine the disposition, of the revolving fund at the end of the project? / If NO, please clarify this item in writing with the donor.
H. INDIRECT COST RECOVERY
1. Does the contract/grant provide indirect cost recovery to another CARE Member? / If YES, please provide method & amount.
2. Does the contract/grant provide indirect cost recovery to CARE USA?
a) Is indirect cost to CARE USA calculated as a percentage of direct costs of the contract/grant?
b) Is indirect cost otherwise calculated? / If NO, please explain.
If YES, please explain
3. Is the indirect cost recovery for this grant/contract provided by a different grant/contract?
a) If YES, please describe the other grant/contract and the manner of calculation.
4. If indirect cost recovery is provided in a "soft" currency, can the Country Office use the proceeds as they are earned? / If NO, please obtain CARE/USA Controller permission before signing.
5. If the grant/contract is with the US Government or is a subgrant/subcontract of funding originally from the US Government, does it provide indirect cost recovery to CARE? / If NO, please obtain CARE/USA Controller permission before signing.
I. BUDGET
1. Is an expense budget included in the contract/grant or in the listed attachments? / Budgets included in Grant Agreements/ Contracts usually reflect the original budget submission by CARE. Please review all critical budget related items (e.g. adequacy in relation to objectives, match, ICR, reporting formats, special costs) and ensure that the budget submitted to the donor meets all criteria.
2. Is the purpose of the budget included in the agreement defined by the contract/grant?
a) Is the included budget illustrative only?
3. Does an included budget define line item spending limitations?
4. If a budget defines line item spending limitations, does the contract/grant allow line item flexibility from the stated budget?
a) If YES, is the flexibility adequately defined?
5. Is the budget flexibility acceptable? / If NO, renegotiate with the donor or do not sign.
6. If a budget is incorporated into the contract/grant, does that budget follow CARE Chart of Accounts? / If NO and if Financial reporting by Budget Line Items is required, please renegotiate budget presentation.
J. KEY PERSONNEL
1. Does the grant/contract contain "key personnel" employment clauses?
a) If YES, are those clauses acceptable to CARE? / If NO, please renegotiate clause or do not sign.
2. Does the grant/contract provide donor related benefits comparable to other grant recipients?
K. BANKING AND PAYMENT
1. Does the contract/grant require the establishment of any specific purpose bank accounts? / If YES, please obtain CARE/USA Controller permission before signing.
2. Will non-CARE signatories on a bank account be required? / If YES, please obtain CARE/USA Controller permission before signing.
3. By what mechanism will grant/contracts funds be disbursed? / Letter of Credit
Advance
Reimbursement
Advance/Reimbursement
Other (please specify):
4. If funds are to be advanced or reimbursed, does the contract/grant provide details of the timing of the payments?
a) Is the timing of payments acceptable to CARE? / If NO, please renegotiate until acceptableaccptable; otherwise, do not sign .
5. Describe any special requirements relating to monetization
6. Will funds be paid by the funder directly to the Country Office?
7. Will funds be paid by the funder directly to CARE USA?
8. Will funds be paid by the funder to another CARE Member who will then transfer the funds to the Country Office? / If YES, please explain.
9. Will funds be paid directly to another CARE Member who will then transfer the funds directly to CARE USA? / If YES, please explain.
10. Will funds be paid by the funder to a non-CARE entity that will in turn transmit the funds to CARE? / If YES, please explain.
L. FOR COMMODITIES CONTRACT/GRANTS.
1. If CARE is responsible for paying for transporting any commodities to port/border (e.g., shipping fees, insurance premiums), is there adequate funding to cover these costs? / If NO, please obtain Regional Director funding approval before signing.
2. If the Country Office is to receive commodities at port or border, will all customs costs (e.g. port fees, import licenses, custom clearance stamps and other phyto-sanitary certificates) be either waived or covered by contract/grant funding? / If NO, please obtain Regional Director funding approval before signing.
3. If CARE must store the commodities at port/border or at other warehouse sites before distribution to recipients, is there adequate funding of storage costs, including security and monitoring expenses? / If NO, please obtain Regional Director funding approval before signing.
4. If CARE must forward commodities from port/border to warehouses or distribution sites, is there adequate funding to cover transportation costs, including loading and unloading, fuel, spare parts, insurance, etc.? / If NO, please obtain RegionalobtainRegional Director funding approval before signing.
5. Is funding adequate to cover project objectives and monitoring, insurance, staff and administration, etc. associated with the project? / If NO, please renegotiate with the donor or obtain funding from another source before signing.
6. Will title to commodities be transferred by the funder:
a) directly to CARE USA?
b) directly to the Country Office?
c) to another party (including a CARE International Member or non-CARE entity) / If YES, please explain.
M. SUBRECIPIENTS
1. Does the contract/grant provide that a substantial amount of CARE's responsibilities are to be performed by one or more sub-recipients?
(For this question, consider funds or commodities valued at, or activities costing, more than $25,000 to be substantial) / If YES, please explain.
2. If this is a US government funding, have adequate fees for auditing sub-recipients under current OMB-133 requirements beenrequirementsbeen included in the grant/contract? / If NOno, please renegotiate budget.
N. PROCUREMENT PROCEDURES
1. Do CARE procurement policies satisfy required procurement procedures of the contract/grant?
2. Does the contract/grant require specific origin of major purchases?
a) If YES, are the limitations acceptable? / If NO, please do not sign.
O. PROJECT ASSETS
1. Is the end of project disposition of items purchased with grant funds adequately described?
2. Is such disposition acceptable to CARE? / If NO, please do not sign.
3. Is the title holder of all project material and commodities and equipment defined?
a) During the project?
b) After the project? / If NO, please clarify in grant/contract.
4. If the funder is the US Government, is the title of the project assets (including commodities) "Recipient Title"?
5. Does the donor require special inventory procedures (such as periodic listings of materials or commodities on hand or periodic inventory counts) beyond CARE standards?
P. INSURANCE
1. Will the contract/grant accept
insurance premiums for all insurance commonly obtained by CARE as a valid expense?
2. Are any additional insurance policies required by the contract/grant?
a) Are the costs of these policies covered by donor funds? / If NO, please note that Country Office is responsible to cover additional costs.
Q. ACCOUNTING
1. Does the grant/contract require CARE to deviate from its standard accounting practices? / If YES, please explain.
2. Is other than accrual accounting required? / If YES, please explain.
3. Is CARE required to submit original accounting documents or original accounting support documentation to the donor? / If YES, please obtain CARE/USA Controller permission before signing.
4. Does the contract/grant require that translations of local currency to US dollars be done differently than the method currently used by CARE policy? / If YES, please obtain CARE/USA Controller permission before signing.
5. Translation of transactions from local currency to the reporting currency, does the donor accept CARE's methods? / This should be avoided and may be acceptable only if
1) the Country Office is responsible for reporting; and 2) the Country Office has resources to absorb any resulting currency losses on CARE’s books
6. Record Retention Are the record retention requirements of the contract/grant more onerous than the seven year CARE requirement? / If YES, please explain how the Country Office will handle this.
R. INTEREST ON ADVANCES OR PROCEEDS FROM MONETIZED COMMODITIES TO CARE
1. If funding is advanced or if commodities are monetized, is CARE required to account for the interest earned on the advance or proceeds from the commodities?
2. If CARE is required to account for the interest earned on advances or monetized commodities, is the CARE method of accounting for interest acceptable? (Refer to OFM, Chapter. 8.) / If NO, please obtain CARE/USA Controller permission before signing.
3. If interest is recorded on funding advances or the proceeds from monetized commodities, does the interest revert to the project by being added to project funding?
a) If YES, may it also be applied to projects of the same donor, another donor or CARE/USA?
4. If interest is recorded on the advances or the proceeds from monetizedfrommonetized commodities, must it be refunded to the donor?
5. Is interest to be handled in some manner not described above? / If YES, please explain and obtain the approval of CARE/USA ControllerUSAController before signing.
S. INTEREST ON FUNDS FRONTED BY CARE
1. If CARE is required to incur expenses prior to the receipt of funding (i.e. reimbursement type funding) or of commodities, will the funder pay CARE interest?
2. If CARE is required to pay interest on contract/grant payable, is such interest offset by interest on contract/grant receivable? / If, NO, please obtain CARE/USA Controller permission before signing.
T. FINANCIAL REPORTING
1. Does the contract/grant list the timing and nature of all financial reporting to be done by the Country Office? / If NO, please prepare and attach a list to this checklist.
2. Does the contract/grant list the timing and nature of all financial reporting to be done by CARE USA Headquarters? / If NO, please consult with and send instructions to the Grants, Contracts & Donor Reporting unit in HQ Finance.
3. Does the contract/grant list the timing and nature of all financial reporting to be done by CARE Member Headquarters? / If NO, please consult with and send the necessary instructions to the concerned CI member.
4. Is a final financial report required?
a) If YES, are the requirements including due dates and content detailed in the contract/grant? / If NO, please prepare a list of the requirements and distribute as per U1, 2 or 3.
5. Can CARE's Chart of Accounts be used to meet donor reporting requirements? / If NOno, please renegotiate reporting requirements or budget line items. (see also section N, Budget).
U. PROGRAMMATIC REPORTING
1. Does the contract/grant list the timing and nature of all programmatic reporting to be done by the Country Office? / If NO, please prepare and attach a list to this checklist.
2. Does the contract/grant list the timing and nature of all programmatic reporting to be done by CARE Atlanta? / If NO, please consult with and send instructions to the HQ unit responsible for programmatic reporting
3. Does the contract/grant list the timing and nature of all programmatic reporting to be done by a CARE Member's HQ? (Other than Atlanta) / If NO, please consult with and send instructions to the CI member responsible for programmatic reporting.
4. Is a final progress report
required?
a) If YES, are the requirements including due dates and content detailed in the contract/grant? / If NO, please prepare a detailed list and distribute as per V.1, 2 or 3.
V. PERFORMANCE
1. Is CARE required to return the donor's funds or reimburse the donor for the value of commodities if a certain performance level is not obtained or if there are commodity losses? / If YES, please consider risk to CARE and negotiate appropriate escape clause that limits CARE’s liability. If unable to renegotiate, obtain approval ofCARE USA Controller.
2. Is CARE required to perform certain tasks the cost of which is not covered by the donor
a) If YES, is there adequate other funding to meet these obligations? / If NO, please explain how CARE will meet these obligations
3. Is CARE required to post a performance bond or provide another type of guarantee under the terms of this agreement?
a) Are the costs related to posting the bond/ maintaining the guarantee covered by grant/contract funds?
b) Is the level of risk acceptable to CARE? / If YES and Headquarters’ assistance is required (e.g. to establish a Letter of Credit), please contact the appropriate Unit early in the negotiation process
If NO, please ensure that adequate matching funds are available for this purpose
If NO, renegotiate the performance terms of the grant/ contract or do NOT sign.
W. AUDIT
1. Does the contract/grant require CARE to obtain independent audited financial reports (other than CARE's comprehensive audited financial statements)?
a) If YES, does the contract/grant cover all related audit costs? / If NO, please explain and list source of funds.
2. Does the contract/grant require any special internal (as opposed to independent) audit reporting?
a) If YES, does the contract/grant cover all related audit costs? / If YES, please explain.
If NO, please explain and list source of funds.

Please attach expanded explanations on additional pages as necessary. On any attachment, please reference the