This policy is designed to establish the techniques and procedures to properly ensure adequate monitoring of program performance and the reporting of project activities sufficient to assure compliance with the program and fiscal requirements of the project and demonstrate project accomplishment. This policy applies to all employees, officers, and contractors doing business with GBPLD.

Requirements

Performance Monitoring

• GBPLD will ensure that all grant activities are conducted in a timely manner, and in accordance with the award agreement.
• GBPLD will assess internal continuing capacity to implement the approved project.
• GBPLD will identify potential problem areas to assist in complying with applicable laws and regulations.

Reporting

• GBPLD will prepare and submit all reports required by funding sources in a timely and accurate manner in accordance with the provided instructions.
• GBPLD will maintain legible copies of documentation that will set forth details sufficient for a proper pre-audit and post-audit review.
• GBPLD will submit written reports on progress and outcomes of the project as described in the approved project. Progress reports may include updates on
  • Tasks – Specific activities that are required to be performed to complete the Project Narrative/Scope of Work goals and objectives.
  • Deliverables - Products and/or services that directly relate to a task specified in the Scope of Work. Deliverables must be quantifiable, measurable, and verifiable.
  • Performance Metrics – Pre-established performance expectations for the delivery of services or production of resources.

Responsibilities

Performance Monitoring

• The Director of Finance and Director of Grants will oversee project activities to ensure total compliance with 2 CFR 200, Uniform Administrative Requirements, applicable Cost Principals and Audit Requirements for Federal Awards, applicable federal program statutes and regulations, and the terms and conditions of award agreements.
• The Director of Finance and Director of Grants will assist in resolving compliance problems through discussion, negotiation, and the provision of technical assistance and training.
• The Director of Finance and Director of Grants will provide adequate follow-up measures to ensure that performance and compliance deficiencies are corrected and not repeated.

Reporting

• The Director of Finance prepares and the Director of Grants reviews the SF-425 report to ensure it is completed on time and complies with the OMB Form Instructions, using cumulative financial data from the sponsor’s payment system and the GBPLD financial system to complete the report. The Chief Executive Officer will review and approve the SF-425.
• Research staff is responsible for ensuring all performance/programmatic reporting complies with established federal requirements as well as any additional requirements set forth by the Grant Award Notice or Special Conditions. The Director of Grants will review and approve programmatic reporting before submission to the sponsor.

Board Approved 5/14/2024

This policy is designed to establish the techniques and procedures to properly prepare, comply, and cooperate with any inspections, reviews, investigations, or audits deemed necessary. Grants awarded by the federal government are subject to on-site monitoring and/or audits. This policy applies to all employees, officers, and contractors doing business with the GBPLD.

Pre-Monitoring

In preparation for the reviews, the Director of Grants will perform the following pre-monitoring tasks:

• Become thoroughly familiar with the program;
• Develop a clear understanding of the governing statutes, regulations, and official guidance.
• Review and analyze reports, available data, and financial information, from previous monitoring reports and issues;
• Determine the programs/areas/functions to be reviewed;
• Determine the data or information to be submitted prior to monitoring (if any);
• Prepare the staff members who will need to be consulted during the monitoring; and
• Finalize the schedule for conducting the monitoring tasks and the anticipated time frames.

On-Site Monitoring

On-site reviews involve monitoring overall program administration and can include examining information and materials provided to the awarding agency by GBPLD to track performance and identify potential problem areas. The monitoring event is designed to assess and document compliance with the requirements based on:

• File reviews to determine the accuracy of the information, using both automated and manual data and reports submitted by GBPLD; and
• Interviews with staff to clarify and determine the accuracy of the information.

The documents reviewed include activity status reports, if applicable, monthly review of the project schedule, monthly project updates, and financial information to assess performance and look for indicators of performance or compliance problems. In addition, GBPLD may submit progress reports that include the activity showing the progress, accomplishments, barriers, and spending patterns against planned activities and accomplishments.

Post-Monitoring

At the end of the review, the monitoring agency will provide GBPLD with a formal written notification of the results of the monitoring review. The letter will outline any concerns, findings, recognize successes, and the deadline for a written response to correct actions. An important and fundamental principle of the monitoring process is the documentation of deficiencies when there is evidence that a statute, regulation, or requirement has been violated but it retains discretion in identifying appropriate corrective action(s) to resolve deficiencies. An equally fundamental principle is that GBPLD has a process to respond to and resolve deficiencies.

Identified monitoring deficiencies require corrective action. The corrective action responsibility rests both with the awarding agency and GBPLD. GBPLD has a responsibility to determine, or assist the awarding agency in determining, the reason a requirement was violated or provide evidence of compliance.

A key piece of effective monitoring is the ability to identify the root cause(s) of any identified deficiencies, or whether the problem is an isolated occurrence or systemic. Such knowledge leads to the development of optimal corrective actions. In some cases, GBPLD may need to determine appropriate action if compliance is not possible.

Board Approved 5/14/2024

This policy establishes the internal processes necessary to ensure consistency and uniformity in cost estimating and budget development. This policy applies to all employees, officers, and contractors doing business with GBPLD and to all sources and uses of funding received by GBPLD.

Requirements

• Budget development processes shall be properly documented, measured, and managed to ensure accuracy, financial transparency, strict compliance with generally accepted accounting principles (GAAP), reporting requirements, and continuous improvement.
• Budget development practices must comply with all applicable government laws and regulations.
• Estimating, budgeting, and accounting practices must be consistent with those practices used for accumulating and reporting costs.
• Estimating, budgeting, and accounting practices must comply with generally recognized and government approved cost principles and accounting standards (GAAP).
• Illinois Statutes are followed in determining timing and final dates of action.
  • The GBPLD Fiscal Year is July 1 through June 30.

Responsibilities

• GBPLD Managers will project departmental needs for the upcoming fiscal year and report to their Division Chiefs.
• Division Chiefs will consolidate their departments’ budget information and submit to the Director of Finance (DOF).
• The DOF will prepare the District budget for review by Cabinet.
• Cabinet will balance the proposed budget with anticipated tax revenues and make final decisions for line-item cuts.
  • Cabinet must include Division Chiefs, the Chief Executive Officer, and both Chief Operating Officers.
• Preliminary draft budget will be presented at the June Board of Trustees meeting and approved at the July Board meeting.
• Budget appropriation document will be approved in September of the same FY.

Board approved 5/14/2024

The GBPLD is committed to the highest possible standards of openness, transparency, and accountability in all its affairs. We wish to promote a culture of honesty and opposition to fraud in all its forms. The purpose of this policy is to provide:

• A clear definition of what we mean by “fraud”.
• A definitive statement to staff forbidding fraudulent activity in all its forms.
• A summary to staff of their responsibilities for identifying exposures to fraudulent activities and for establishing controls and procedures for preventing such fraudulent activity and/or detecting such fraudulent activity when it occurs.
• Guidance to employees as to action which should be taken where they suspect any fraudulent activity.
• Clear guidance as to responsibilities for conducting investigations into fraud related activities. Protection to employees in circumstances where they may be victimized as a consequence of reporting, or being a witness to, fraudulent activities.

Definition

GBPLD defines fraud as: "The theft or misuse of GBPLD funds or other resources by an employee, officer, vendor, contractor, or an independent third-party provider, which may or may not also involve misstatement of financial documents or records to conceal the theft or misuse.”

For example, fraud includes but is not limited to the following:

• Theft of funds or any other GBPLD property.
• Falsification of costs or expenses.
• Forgery or alteration of documents.
• Destruction or removal of records to conceal fraudulent behavior.
• Inappropriate personal use of GBPLD assets.
• Employees seeking or accepting cash, gifts, or other benefits from third parties in exchange for preferment of the third parties in their dealings with GBPLD.
• Blackmail or extortion.
• Paying excessive prices or fees to third parties with the aim of personal gain.

Responsibilities of Employees

Managers

It is the responsibility of managers to be familiar with the types of fraud that might occur in their area, be alert for any indication of fraud or improper activity, and maintain controls to avoid such occurrences. Managers are required to ensure that all staff under their control are given a copy of this policy in a language they can understand and acknowledge its receipt. Managers should also ensure that staff are encouraged to report suspected issues of fraud.

All Staff

It is the responsibility of all employees to carry out their work in such a way as to prevent fraud from occurring in the workplace. Employees must also be alert for occurrences of fraud, be aware that unusual transactions or behaviors could be indications of fraud, and report potential cases of fraud as outlined below.

Reporting Suspected Fraud

Employees are required to report issues of suspected fraud. Employees should report their suspicions as follows:

• To the Chief Executive Officer.
• To the President of the GBPLD Board of Trustees.

Employees who suspect fraud should not do any of the following:

• Contact the suspected individual(s) directly in an effort to determine facts, demand explanations, or restitution.
• Discuss the issue with anyone within GBPLD other than the people listed above.
• Discuss the issue with anyone outside of GBPLD, except as required by law.

Additional information can be found in the GBPLD Whistleblower Policy (2.45).

Dealing with Reports of Suspected Fraud

Any suspicions of fraud will be taken seriously by GBPLD. GBPLD expects its managers to deal firmly and quickly with any reports of suspected fraud. Managers receiving reports of suspected fraud must immediately identify the issue and propose actions to the President of the GBPLD Board of Trustees.

Investigation Guidelines

Arrangements must be made for a comprehensive investigation of the issue. The following are responsible for managing these investigations:

• President of the GBPLD Board of Trustees who will bring the issue to:
  • Compliance Officer and Secretary of the GBPLD Board of Trustees, or if either of these individuals is implicated to another member of the Executive Committee of the Board.
  • The employee’s immediate supervisor if the supervisor is not implicated.
  • The President of the GBPLD Board of Trustees will assign responsibility to the senior management team and/or other GBPLD Board members to investigate and report back.

All work of the investigation team should be documented, including transcripts of interviews conducted. The conclusion of all fraud investigations must be documented and reported to the GBPLD Board of Trustees. The person(s) who initially reported the suspicions should be informed of the outcome of the investigation, but this should be done only once the report and proposed course of action has been finalized.

Safeguards for Employees

Harassment or Victimization

GBPLD recognizes that the decision to report a suspicion can be a difficult one to make, not least because of the fear of reprisal from those responsible for the malpractice. GBPLD, in accordance with its Human Resource Policies, will not tolerate harassment or victimization and will take all practical steps to protect those who raise an issue in good faith. The Whistleblower Protection Act has been expanded to include grant recipients. Under Title 41, United States Code, Section 4712, it is illegal for an employee of a Federal contractor, subcontractor grantee, or subgrantee or personal services contractor to be discharged, demoted, or otherwise discriminated against for making a protected whistleblower disclosure. Also, under Presidential Policy Directive (PPD-19), an action affecting access to classified information cannot be taken in reprisal for protected whistleblowing.

Confidentiality

GBPLD will endeavor to protect an individual’s identity when he or she raises an issue and does not want their name to be disclosed. It should be understood, however, that an investigation of any malpractice may need to identify the source of the information and a statement by the individual may be required as part of the evidence.

Anonymous Allegations

GBPLD discourages anonymous allegations. Issues expressed anonymously will be considered at the discretion of the GBPLD Board Trustees. In exercising this discretion, the factors considered will include:

• The seriousness of the issues raised.
• The credibility of the allegations and the supporting facts.
• The likelihood of confirming the allegation from attributable sources.

Untrue Allegations

If an allegation is made in good faith, but it is not confirmed by an investigation, GBPLD guarantees that no action will be taken against the complainant. If, however, individuals make malicious or vexatious allegations, disciplinary action will be considered against the individual making the allegation.

Actions Arising from Fraud Investigations

Disciplinary Procedures

Persons judged guilty of fraud or who have committed gross misconduct may be dismissed. Where appropriate, GBPLD will refer significant fraud to the local law enforcement agencies to initiate criminal prosecution.

Recovery of losses

Where GBPLD has suffered loss, full restitution will be sought of any benefit or advantage obtained and the recovery of costs will be sought from the individual(s) or organizations responsible for the loss. If the individual or organization cannot or will not make good the loss, consideration will be given to taking civil legal action to recover losses. This is in addition to any criminal proceedings which may result.

Review of this Policy

The contents of this Anti-Fraud Policy will be reviewed by the GBPLD Board of Trustees on an annual basis.

References

Referenced GBPLD policies include:

• GBPLD Whistleblower Policy (2.45)

Approved by the Board 4/9/2024

Overview

Internal controls are the protocols, procedures, and activities that protect Gail Borden Public Library District (GBPLD) from financial, operational, and strategic risk. The purpose of this policy is to prevent risk and to ensure that the objectives of compliance are established.

2 CFR 200.303 (Internal Controls) requires that non-Federal entities receiving Federal awards establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. This policy is guided by the Code of Federal Regulations, Standards for Internal Control in the Federal Government (Green Book), and the COSO Integrated Framework (Committee of Sponsoring Organizations of the Treadway Commission). These publications establish the compliance structure, and the three objectives, five components, and seventeen elements of robust internal controls.

Three Objectives of Internal Control

1. Reporting – reliability
2. Operations – effective and efficient
3. Compliance – compliant with applicable laws, regulations, contracts, grants, and cooperative agreements

Five Components and Seventeen Elements of Internal Control

1. Control Environment
   1. Demonstrates commitment to integrity and ethical values.
   2. Exercises oversight responsibility.
   3. Establishes structure, authority, and responsibility.
   4. Demonstrates commitment to competence.
   5. Enforces accountability.
2. Risk Assessment
   6. Specifies suitable objectives.
   7. Identifies and analyzes risk.
   8. Assesses fraud risks.
   9. Identifies and analyzes significant change.
3. Control Activities
   10. Selects and develops control activities.
   11. Selects and develops general controls over technology.
   12. Deploys through policies and procedures.
4. Information and Communication
   13. Use relevant, quality information.
   14. Communicates internally.
   15. Communicates externally.
5. Monitoring Activities
   16. Conducts ongoing and/or separate evaluations.
   17. Evaluates and communicates deficiencies.

Five Components of Internal Control

Control Environment

Overview

The control environment is the foundation for all other components of internal control, providing discipline and structure. Moreover, management establishes the tone at the top regarding the importance of internal control and expected standards of conduct and reinforces expectations at various levels. Control environment factors include the integrity, ethical values, and competence of GBPLD personnel; the way management assigns authority and responsibility and organizes and develops its personnel; and the attention and direction provided by the GBPLD Board of Trustees.

Objectives

The Board of Trustees and management should:

1. Conduct business with integrity and ethical behavior.
2. Provide direction and oversight for the internal control system.
3. Hire qualified and competent management.
4. Establish structure, authority, and responsibility, and hold individuals accountable for internal control responsibilities.

Policies

1. The Board of Trustees through management has adopted the GBPLD Personnel Handbook that details policies, expectations, and other employment-related topics.
2. Each employee receives a copy of the Personnel Handbook, which includes a policy on business ethics and conduct, and signs an acknowledgment of receipt.
3. Management has developed job descriptions for each position and reviews employee compliance on an annual basis through performance evaluations.
4. The Board of Trustees uses the budget process as a means of oversight with executive staff.
5. Organizational charts are reviewed for needed changes in authority and responsibility.

Procedures

• The Chief Executive Officer and senior management review the Personnel Handbook annually to determine needed revisions to comply with federal and state laws, as well as policies of GBPLD.
• The Chief Executive Officer reviews suggested revisions, if any, by senior management and presents the finalized manual to the Board of Trustees for approval.
• Detailed job descriptions with minimum job requirements are maintained for each position within the organization.
• The Chief Executive Officer and senior management review employee job descriptions annually to ensure compliance.
• The Chief Executive Officer and senior management document employee performance through annual employee evaluations.
• The annual budget is prepared by the senior management and the Director of Finance prior to the start of a new fiscal year. It is then submitted to the Chief Executive Officer for review. The Chief Executive Officer recommends it for approval to the Board of Trustees.
• The GBPLD Organizational Chart is reviewed and revised at least annually for accuracy.

Organizational Chart

Job Descriptions

Current job descriptions are found in the Administration Office.

Risk Assessment

Overview

GBPLD assesses risk of operations continually. GBPLD has chosen to transfer the most common types of risk through the purchase of appropriate insurance, such as:

1. Property and Casualty
2. Liability
3. Errors and Omissions
4. Worker Compensation

GBPLD has assessed the risks related to financial matters and compliance issues and has developed appropriate internal controls through the development of policies and procedures contained in the Accounts Receivable, Allowable Costs, Anti-Fraud, Budget Monitoring and Activity Tracking, Cash Management, Expenditure Control, Personnel Handbook, Procurement, and Policies and Procedures Manual. These control activities will not eliminate all risks but will assist with risk reduction and will allow the Board of Trustees to determine that there is reasonable assurance that accurate financial reporting responsibilities and compliance objectives are being met.

Objectives

1. Collections are complete, timely, and accurate.
2. Disbursements are for valid expenses and are accurately recorded.
3. Assets are properly safeguarded.
4. GBPLD complies with local, state, and federal laws, and terms and conditions of award agreements and contracts.

Risks

1. Collections could be lost or misappropriated.
2. Collections could be recorded improperly.
3. Collections may not be deposited in the bank and recorded in a timely manner.
4. Disbursements could be unauthorized.
5. Disbursements could be for personal items.
6. Disbursements could be made for items never received.
7. Bank balances may be inaccurate due to failure to reconcile bank accounts.
8. Grant funds could be spent on unallowable items.
9. Terms and conditions of grant and cooperative agreements may not be followed, resulting in having to return funds to the grantor.
10. Federal and pass-through reporting requirements may not be met.

Control Activities

Overview

Control activities are policies and procedures established by management to ensure the risks identified during the risk assessment process are mitigated or reduced to an acceptable level. The significant areas of risk are identified above, and policies and procedures designed as control activities are documented in the Accounts Receivable, Allowable Costs, Anti-Fraud, Budget Monitoring and Activity Tracking, Cash Management, Expenditure Control, Personnel Handbook, Procurement, and Policies and Procedures Manual. These control activities are designed to mitigate the identified risks.

Information and Communication

Overview

Management has the responsibility to adequately communicate information to both internal and external parties. It is important that employees know the objectives, policies, and procedures management has established and what the expectations are for internal controls. External stakeholders may also seek information regarding objectives and reliable financial information.

Objectives

1. Necessary information for achieving GBPLD’s objectives is available and used.
2. Necessary information for achieving GBPLD’s objectives is internally communicated by management.
3. Necessary information for achieving GBPLD’s objectives is externally communicated by management.

Policies

1. Information maintained in a format should be communicated in that same format. For example, if the general ledger is maintained on a computer, the monthly budget to actual reports should be provided through a computer-generated report from that software package.
2. Reliable and accurate information from GBPLD must be communicated to the internal and external people who need it in a timely and useful format.
3. Because the credibility of GBPLD, its Board of Trustees, and its employees is at stake whenever information is released to outside parties, management should be confident the information being released is accurate and in compliance with policies and procedures.
4. The Board of Trustees communicates the types of information required to achieve their objectives and mitigate risk.

Procedures

• The staff of GBPLD are required to submit quality information that allows the Board of Trustees to make informed decisions and evaluate whether the organization is achieving its objectives.
• GBPLD clearly defines lines of communication through the policy manual and organizational chart.
• GBPLD has a written organizational chart for employees to show clear lines of authority (who manages whom) and written job descriptions for all employees and open positions.
• GBPLD’s manuals are available to all staff via the public website and the internal shared drive.
• GBPLD abides by Illinois’s laws for communicating with external parties, which includes the redaction of sensitive information.
• System-generated reports pulled from various software programs are available in both electronic and printed formats.
• Information presented to the Board of Trustees is provided monthly and is also available upon request.

Monitoring

Overview

The internal control system changes as technology, staff, objectives, and policies change. Senior management is charged with continually monitoring the internal control system to determine if it is operating as it was designed to do and to ensure the controls are being followed.

Objectives

• Practice activities to monitor the internal control system and evaluate results.
• Address deficiencies noted in the internal control system in a timely manner.

Policies

• An annual risk assessment will be conducted to ensure that the internal controls continue to work as designed over time.
• GBPLD will use information from the risk assessment to establish more efficient and effective operations over time.
• Accurate and reliable information will be used in decision making.

Procedures

• The Chief Executive Officer and senior management annually evaluate the state of the internal control system and determine any deviations from the designed criteria and the current condition of the system.
• Management decides whether to change the design of the internal control system or implement corrective actions to improve the effectiveness of the existing system. Significant changes will be approved by the Board of Trustees.
• Management will periodically review the procedures outlined in all GBPLD policies and manuals to ensure that policies are being implemented and objectives are being met.
• Financial reports will be generated monthly and reviewed by the Chief Executive Officer.

The GBPLD is committed to the highest possible standards of openness, transparency, and accountability in all its affairs. We wish to promote a culture of honesty and opposition to fraud in all its forms. The purpose of this policy is to provide:

• A clear definition of what we mean by “fraud”.
• A definitive statement to staff forbidding fraudulent activity in all its forms.
• A summary to staff of their responsibilities for identifying exposures to fraudulent activities and for establishing controls and procedures for preventing such fraudulent activity and/or detecting such fraudulent activity when it occurs.
• Guidance to employees as to actions which should be taken where they suspect any fraudulent activity.
• Clear guidance as to responsibilities for conducting investigations into fraud related activities. Protection to employees in circumstances where they may be victimized as a consequence of reporting, or being a witness to, fraudulent activities.

References

Referenced GBPLD policies include:

• GBPLD Personnel Handbook
• Accounts Receivable Policy
• Allowable Costs Policy
• Anti-Fraud Policy
• Budget Monitoring and Activity Tracking Policy
• Cash Management Policy
• Expenditure Control Policy
• Procurement Policy
• GBPLD Policies and Procedures Manual

Approved by the Board 4/9/2024