Notice of Revisions to Performance Area Four of LSC's Performance Criteria, 14047-14060 [2018-06532]
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Federal Register / Vol. 83, No. 63 / Monday, April 2, 2018 / Notices
Type of Review: Extension.
Title: Request to be Selected as Payee.
OMB Number: 1240–0010.
Agency Number: CM–910.
Affected Public: Individuals or
households; Business or other for profit;
Not-for-profit institutions.
Total Respondents: 250.
Total Annual Responses: 250.
Average Time per Response: 15
minutes.
Estimated Total Burden Hours: 63
hours.
Frequency: On occasion.
Total Burden Cost (capital/startup):
$0.
Total Burden Cost (operating/
maintenance): $132.50.
Comments submitted in response to
this notice will be summarized and/or
included in the request for Office of
Management and Budget approval of the
information collection request; they will
also become a matter of public record.
Dated: March 13, 2018.
Yoon Ferguson,
Agency Clearance Officer, Office of Workers’
Compensation Programs, U.S. Department of
Labor.
[FR Doc. 2018–05624 Filed 3–30–18; 8:45 am]
BILLING CODE 4510–CK–P
LEGAL SERVICES CORPORATION
Notice of Revisions to Performance
Area Four of LSC’s Performance
Criteria
Legal Services Corporation.
Notice of revisions to
guidelines.
AGENCY:
ACTION:
To provide grantees with the
most effective guidance, in 2018 the
Legal Services Corporation revised
Performance Area Four to refine and
expand the areas of inquiry to focus on
those criteria for which LSC has found
the most deficiencies, particularly
Criteria 1 (Board Governance), 4
(Financial Administration), and 7
(General Resource Development). The
2018 revisions codify the work of LSC
staff with numerous grantees and
provide evidence-based guidance to
recipients on how to run a highperforming nonprofit organization.
FOR FURTHER INFORMATION CONTACT:
Lynn Jennings, Vice President for Grants
Management, Legal Services
Corporation, 3333 K Street NW,
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SUMMARY:
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Washington, DC 20007, (202) 295–1645,
performancearea4@lsc.gov.
LSC’s
Performance Criteria indicate that legal
services programs should be led and
managed effectively with high-quality
governance, administrative systems,
procedures, and policies. Good
leadership and strong internal
operations increase the likelihood of
effective program services for clients.
Over the past several years, LSC has
observed some areas of weakness in
grantee governance through
performance quality visits, compliance
reviews, and Office of Inspector General
(OIG) visits. The 2018 revisions codify
the work of LSC staff with numerous
grantees and provide evidence-based
guidance to recipients on how to run a
high-performing nonprofit organization.
Since 2010, LSC’s Office of Program
Performance has conducted 133
Program Quality Visits of 124 grantees.
LSC issued 1,901 Tier One 1
recommendations across the reports
summarizing those visits. Of the 1,901
Tier One recommendations, 695
recommendations—36.5%, the most of
any performance area—pertained to
Performance Area 4. From 2011 to 2016,
LSC’s Office of Compliance and
Enforcement conducted 111 Compliance
Reviews of 106 grantees. LSC issued
more than 1,200 Required Corrective
Actions (RCAs) related to both
regulatory and fiscal issues.
Approximately 25% of the RCAs
identified deficiencies in the grantees’
financial administration. Additionally,
OIG conducted 41 A–50 reviews
between June 2012 and September 2017.
As a result of those reviews, the OIG
made 160 referrals to OCE. The referrals
covered issues related to timekeeping,
SUPPLEMENTARY INFORMATION:
1 According to LSC’s Office of Program
Performance Procedure Manual:
• Tier One Recommendations are those
recommendations that are determined to be
significant and will be included in the next Request
for Proposal to the grantee.
• Tier One Recommendations are those that if
addressed, have the potential for significantly
improving program quality and/or program
performance within the short term, i.e., two years.
A Tier One Recommendation must:
• be stated in simple straightforward terms such
that there is no doubt by the program that a
response is required; and
• have an objective, the value of which equals or
outweighs any additional burden that the
recommendation imposes on the program (does not
apply to statutory or regulatory requirements).
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deficiencies in policies and procedures,
cost allocation, and internal controls.
This is the background against which
LSC evaluated the existing criteria for
Performance Area 4. The statistics above
gave LSC valuable information about
which areas of grantee administration,
leadership, and governance needed
more rigorous evaluation.
These Performance Criteria are
guidelines for ensuring high program
quality. They are not requirements.
They reflect best practices to which
programs should aspire and which they
should, to the extent possible and
consistent with program resources,
attempt to achieve. These revisions do
not reflect a change in the purposes of
the Performance Criteria stated in the
Introduction to the 2007 revised
version. The purposes of the
Performance Criteria are twofold. First,
the Performance Criteria ‘‘guide LSC’s
assessments of program performance
generally and in the competitive grants
process.’’ Second, the Performance
Criteria serve as a ‘‘useful framework for
internal program self-evaluations,
planning, and program development, as
well as external peer reviews and expert
assessments by other funding sources.’’
LSC will begin using the revised
Performance Area 4 on June 1, 2018.
LSC management recognizes that it may
take time, guidance, and experience for
all grantees to adjust to the revisions.
LSC will, therefore, provide training and
forums to discuss the implementation of
the changes. When conducting program
assessments, LSC staff will take the
scope of the revisions and each
program’s capacity into consideration
when making recommendations.
As the table below indicates, LSC
reorganized the order of the
Performance Criteria. The current
Criterion 3—Overall Management and
Administration—includes a limited
review of a grantee’s technology
infrastructure and administration. To
more accurately reflect the role
technology plays in the daily operations
of an organization and in providing
efficient and effective client services,
LSC proposed creating a separate, new
technology criterion, Criterion 3:
Technology Infrastructure and
Administration. The criterion for
Overall Administration and
Management would now be Criterion 6,
with Internal Communication being
folded into the proposed Criterion 6.
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PERFORMANCE AREA 4: CRITERION ORDERING
Current ordering of Performance Area 4 Criteria
Criterion
Criterion
Criterion
Criterion
Criterion
Criterion
Criterion
1:
2:
3:
4:
5:
6:
7:
2018 Revised ordering of Performance Area 4 Criteria
Board Governance ................................................................
Leadership .............................................................................
Overall Management and Administration ..............................
Financial Administration ........................................................
Human Resources Administration .........................................
Internal Communication .........................................................
General Resource Development and Maintenance ..............
Criterion 1. Board Governance. The
program articulates a clear mission for
the organization. Each board member
demonstrates commitment to the
program and its mission through
consistent engagement in Board
activities that involve all other board
members. The board effectively engages
Criterion
Criterion
Criterion
Criterion
Criterion
Criterion
Criterion
1:
2:
3:
4:
5:
6:
7:
Board Governance
Leadership
Technology Infrastructure and Administration
Financial Administration
Human Resources Administration
Overall Management and Administration
General Resource Development and Maintenance
in strategic organizational planning with
program leadership and staff. It is
responsible for major policy decisions,
while holding organizational
management accountable for effective
performance of their responsibilities.
The board assists with or oversees, as
appropriate, the organization’s efforts to
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develop and maintain resources. The
board also promotes public awareness of
the program in the community in a
manner that aims to enhance the
program’s overall effectiveness and
influence.
Areas of inquiry
Board Composition, Size and Tenure
As a whole, the board is appropriately diverse and representative of the various geographical areas and low-income
populations served by the program.
The size of the board is conducive to effective oversight .......
When determining board tenure, the board struck a balance
between longevity and board experience and the need for
new ideas and insights.
The board has processes and procedures for recruiting and
orienting new board members.
• Is the board membership diverse and representative of the service area?
• Is the board either composed of an appropriate mix of members that are sufficiently expert in areas applicable to the program’s operations and achievement
of overall goals related to the mission—e.g. non-profit management, financial
oversight, fundraising, community engagement—or has it taken steps to ensure that such expertise is available to the board on a consistent basis?
• Does the board adhere to LSC regulations regarding board composition?
• Is there evidence that the board’s size facilitates the effectiveness of its operation?
• What is the tenure of each of the board members, including the board
chair(s)?
• Does the organization impose term limits on board membership?
• If so, what are the term limits?
• Does the board have a policy or practice regarding length of service on the
board and on its Executive Committee?
• If the board imposes term limits, how does the organization avoid the loss of
the experience and expertise of valued directors?
• Is there a process for removing board members?
• Does the board have and follow established policies and practices regarding
recruitment, qualification and retention and engagement of new members?
• Is there a job description for board members explaining their role and duties?
• Is the job description provided to board members?
• Is there an onboarding process for new members?
• Are board members given appropriate orientation and continuing training, including: training on the role of the board, potential conflicts of interest, and on
fiscal, fiduciary, and other responsibilities?
• Is there training on the LSC Act, LSC regulations, LSC performance criteria,
and other best practices?
Board Committees
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The board’s committees structure promotes effective oversight of the organization.
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• What is the board’s committee structure?
• What is the composition of each committee?
• Does each committee have clearly defined responsibilities that are documented in written form?
• If so, is there periodic review and updating of the documents?
• Is there a committee responsible for assessing the performance of the board?
• Is there an executive committee, and, if so, what is its composition?
• How often does the executive committee meet?
• What is the scope of business usually conducted?
• Is there a separate Finance or Audit Committee?
• Does a member of the audit or finance committee have a financial background?
• If not, does the committee engage sufficient assistance from non-board
sources to provide consistent and competent guidance on financial matters?
• Is there a separate fundraising committee?
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Areas of inquiry
Board Meetings and Deliberations
The board fulfills the meeting requirements of LSC regulations.
The board has quorum requirements that are adhered to
The board and committee meetings are well planned and focused to ensure that the board and its committees can
carry out their oversight function.
Meeting materials .....................................................................
Executive session .....................................................................
The board members are engaged and regularly attend and
participate in board and committee meetings.
Board and committee decisions are appropriately documented.
• The board of directors meets at least four times a year.
• There is public notice of meeting and meetings are public.
• Is the board required to reach a membership attendance quorum before it can
take formal action?
• What is the percentage or number requirement for a quorum?
• How many times within the past two years has the board tried to meet but has
not had a quorum?
• If there is no quorum, what percentage of the board attended each meeting?
• Does the organization permit its board to act through virtual meetings such as
email voting, in addition to remote participation by teleconferences or videoconference?
• Are there guidelines or a protocol for virtual meetings?
• Are there pre-circulated agendas for all board and committee meetings?
• If so, who sets the agenda?
• Do the board chair or committee chair and the executive officer contribute to
the agenda?
• Do individual members feel that the board packets distributed in the board and
committee meetings provide them with useful information about the program
and equip them to participate meaningfully in the board or committee meeting?
• What is the quality of the materials?
• How far in advance is board information circulated?
• Do board materials contain updated financial information?
• Do board meetings include an executive session without any staff (including
the executive director)?
• What is the level of attendance at board and committee meetings?
• Do individual members prepare for and participate in meetings?
• Are client board members actively engaged in board meetings and decisions?
• Are board decisions appropriately documented in board minutes?
• Minutes of full board and committee meetings are prepared, reviewed and approved by the board at least by the next scheduled meeting.
• Who prepares the meeting minutes?
• Apart from minutes of board meetings, does the board maintain a separately
indexed chronological record of resolutions that reference their initial date of
adoption and subsequent actions?
Board Transparency and Accountability
The board and members individually, are committed to the
program and its mission. The board properly discloses and
manages any organizational or personal conflicts.
• Is the board supportive of the program?
• Does the board have a policy or practice that effectively deals with conflicts of
interest or potential conflicts of interest?
• Is the policy or practice in writing?
• Are organizational or individual conflicts addressed quickly and effectively?
Board Engagement with Strategic Planning
The board ensures that the program establishes and adheres
to effective strategic planning.
• Does the board adopt a mission statement, that has been collaboratively developed with management?
• Does the board establish a vision for the future?
• Does the board approve strategic goals?
• Does the board articulate core values/principles?
• What is the board’s role in developing the strategic plan?
• Does the board work in close partnership with the management to ensure a
successful planning process?
• Does the board regularly review progress in accomplishing the goals of the
strategic plan and take appropriate action to ensure implementation?
• Does it periodically discuss progress toward strategic goals with program management?
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Board Oversight of the Organization—Programmatic
The board is involved in major policy decisions, aware of
issues in and performance of the program, while leaving
day-to-day management of program operations to program
management personnel.
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• How are major policy decisions made?
• Do board members understand and adhere to clear distinctions between board
governance and program management?
• Do board members understand the major issues at stake for the program?
• How does the board exercise its oversight of program operations?
• Does the board receive regular reports providing objective data on program
performance?
• Monitoring: Does the board receive periodic information on the work of the program?
• Evaluating: Does the board seek information to evaluate the effectiveness of
the program’s services?
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Indicators
Areas of inquiry
Board Oversight of the Organization—Financial
The board exercises effective financial oversight ....................
Ensure funds are used for intended charitable purposes, and
funds are appropriately accounted for.
The board safeguards investments ..........................................
• Are board members aware of and accurate in their perception have a general
understanding of the requirements of the program’s funding sources.
• What systems and procedures does the board have to ensure effective financial oversight?
• How often does the board review financial statements and do they understand
what the financial statements say?
• Do they have experience in or guidance from board members or other advisors
in interpreting the financial statements?
• Is there a finance and/or audit committee to select the independent auditor?
• Is the Form 990 presented to the board and management team prior to or after
it is filed with the IRS?
• Are there opportunities for the CFO/Controller or highest ranking financial officer to confer with the board, or members of the board?
• Has the board established budget guidelines?
• Are policies in place to evaluate the organization’s investment decisions and
performance?
• Are policies in place to safeguard the organization’s assets and tax-exempt
status?
Evaluation of the Executive Director
The board effectively evaluates the chief executive officer or
executive director.
The boards practices appropriate oversight over the Executive Director’s Compensation plan.
• What is the process for evaluating the Executive Director and other top officers
in the organization?
• Do they employ a 360 evaluation?
• Who is involved in the evaluation process?
• How frequently does the board evaluate the chief executive officer or executive
director?
• What, if any, are the criteria used for evaluating the Executive Director?
• Is there a process for reviewing and setting executive compensation?
• If so, what is the process?
• Who is involved in this process?
• Are all board members aware of the Executive Director’s entire compensation
package?
• Is the Executive Director’s compensation based on market data?
• Is there contemporaneous substantiation of the board’s deliberation and decision on the Executive Director’s compensation?
Board’s Role as Ambassador for the Organization
The board effectively promotes and expands the reach and
influence of the program in the communities it serves.
• Do individual members, including client members, speak on behalf of the organization to external audiences at appropriate opportunities?
• Is there a protocol for who speaks on behalf of the board and the organization?
• Does everyone know the ‘‘elevator speech?’’
• Do individual members represent the community to the organization by bringing back concerns, ideas, suggestions and compliments when they have merit
or possibility?
Board’s Role in Resource Development
The board effectively promotes and expands the reach and
influence of the program in the communities it serves, and
develops additional resources for the program.
The board ensures that the program is in compliance with
state and local laws related to solicitation.
The board ensures donations comply with LSC Requirements
• Do board members assist effectively in fundraising and development activity?
• Does the board consult and communicate with the Executive Director to identify and, where appropriate, pursue all types of needed resources?
• Determines how board members will participate in fundraising from sources
where they have knowledge or influence, such as the private bar?
• Does the board receive regular reports on staff fundraising activity?
• Has the organization adopted policies to ensure compliance with federal/state
laws on solicitation of funds?
• Are solicitation materials accurate?
• Donations are properly recorded pursuant to LSC regulations
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Continuous Learning and Assessment
The board is committed to continuous improvement ...............
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• Does the organization maintain and provide its board members with an up-todate board handbook or on-line resources?
• Do members keep up with issues that affect the functioning and future of the
organization?
• Does the board engage in periodic formal or informal self-assessment processes?
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Areas of inquiry
General Good Governance Practices
• Does the board adopt and regularly evaluate a code of ethics that describes
behaviors it wants to encourage and behavior it wants to discourage?
• Did the board adopt a policy for handling employee and client complaints?
• Are there established procedures for employees to report financial impropriety
or misuse of the organization’s resources?
• Does the organization have a whistleblower policy?
• Does the board periodically review the bylaws to ensure that the organization
is in compliance with its governing documents and relevant laws?
• Does the board have policies establishing standards for document retention
and destruction?
• Does the organization keep books and records relevant to its tax-exempt status and IRS filings for appropriate time periods?
• Are the program’s Form 990 and annual report reported on its public website?
Are these documents available to the public upon request?
The board ensures legal and ethical integrity and maintains
accountability.
The board ensures transparency and accountability by making information available to the public on the program’s
mission, activities, finance and governance.
The members of the board exercise independent judgment in
general board decision-making.
Criterion 2. Leadership. The program
has effective leadership that establishes
and maintains a shared sense of vision
and mission. Program leadership means
Is there evidence that board members engage in independent analysis of materials and information provided to them?
a commitment to and achievement of
the program’s goals and objectives
according to a model that emphasizes
teamwork, transparency, excellence,
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effectiveness, efficiency, and
innovation.
Areas of inquiry
General Leadership
• Starting with the chief executive officer, are there recognized, positive, and effective leaders in the program?
• Do board members, community leaders, clients and the legal community express confidence in the program’s leadership?
• What specific leadership and professional development training and activities
has the program provided?
• What are the outcomes of these efforts?
• What opportunities are afforded staff to develop and exercise leadership skills?
• Do staff see themselves as valued members of the program’s team?
• Do program leaders model and encourage teamwork?
• Do program leaders delegate effectively?
• Does the program’s leadership seek the opinions and input of staff and other
stakeholders in its decision-making processes?
• Beginning with the executive director or chief executive officer, is there evidence that the leadership of the program communicates effectively with the
board, staff and community stakeholders?
• Do program leaders effectively address challenges and issues that impede the
program’s progress in accomplishing its mission?
• Starting with the executive director or chief executive officer, is there evidence
that program leadership effectively models, motivates and inspires creativity,
innovation, excellence, and achievement?
Key program staff, starting with the executive director or chief
executive officer, are respected and recognized as the program leaders.
Program leaders hold themselves accountable for motivating
staff, and for promoting an environment that embraces
mentoring and the professional development of all staff,
helping them to achieve their fullest potential.
Key staff are appropriately involved in decision-making processes.
The program’s leadership demonstrates strong, effective
communication skills and the capacity to engage in positive
conflict resolution.
Mission and Vision
Program leaders frame a vision and mission ..........................
Program leaders model a high level of energy, commitment
and integrity in carrying out the program’s mission.
•
•
•
•
Is there a shared sense of vision and mission?
Is it expressed in written form?
Are staff aware of it?
What mechanisms does the program’s leadership use to measure program effectiveness and adherence to the mission and vision?
• In what ways does the program’s stated mission and vision guide the program’s planning and decision-making?
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Diversity
Starting with the executive director or chief executive officer,
the program values and embraces diversity and provides
opportunities for the development of a diverse group of
leaders.
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• In what ways does the program and its leadership demonstrate inclusion and
an appreciation for diversity?
• Is the program’s leadership and management diverse, and, is there evidence
that diversity and inclusion are valued by the program?
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Areas of inquiry
Succession Plan
The program has a leadership succession plan that addresses preserving institutional knowledge and strong leadership
across all levels of program management.
Criterion 3. Technology infrastructure
and administration. The program
provides a stable and secure technology
infrastructure sufficient for staff to work
• Does the program have a clear and reasonable succession plan?
• Is it written?
efficiently and effectively in the
delivery of legal services and to support
the operations of the organization. It
devotes appropriate resources to
Indicators
provide the capacities outlined in LSC’s
‘‘Technologies That Should Be in Place
in a Legal Aid Office Today.’’
Areas of inquiry
Technology planning is ongoing and integrated into the overall strategic plan of the program, includes staff input, and is
reviewed and updated at least annually.
The program has competent IT staff and/or consultants with
appropriate training and certifications to properly maintain
and support its technology systems.
•
•
•
•
•
•
•
•
•
•
The grantee informs employees of their rights when using
grantee-owned computers.
•
The program devotes appropriate resources to establish and
maintain its technological infrastructure, including planning
and budgeting appropriately for ongoing replacement/upgrades of its technology systems.
The program has a proper written IT security program to include robust IT security policies and procedures regarding
protecting client and case data, ensuring the security and
integrity of passwords, use of the Internet and social
media, policies for the use of mobile devices, and if staff
can bring their own devices (BYOD) to access work documents. Staff are familiar with and follow such policies and
procedures.
•
The program has sufficient procedures to back up its data
and has testing protocols to demonstrate that data recovery/protection policies work in practice.
The program stays informed of new technology developments and how it can make better use of technology to
meet its mission.
•
Who is involved in technology planning?
Does the program get input from staff on technology needs?
Has the program ever had an outside technology audit?
How often is the technology plan reviewed and updated?
Does the plan include deadlines for implementation?
What type of network does the program have?
Are there appropriate firewalls?
Are servers hosted on-site, off-site, cloud-based?
If on-site, where are they and how are they secured (locked office, server
room, appropriate A/C)?
What is the program’s IT security program, its policies, user security training
and are the servers, computers and devices patched and kept up to on a regular schedule? Is the network scanned for IT vulnerabilities regularly?
Does the grantee have a warning banner that appears while employees are
logging on and notifies employees of their rights when using their granteeowned computer?
What is the internet bandwidth in each office (any redundant connection available)?
Do offices have Wi-Fi available (is it password protected)?
• Is server equipment kept in a secure environment with appropriate ventilation
and cooling? Are IT systems currently patched and updated?
• Is there a disaster recovery plan (that includes periodic testing) for mission critical technology systems?
• Are there security policies and procedures for protecting client and case data,
sensitive personal and personnel data, and all communications from loss or
unauthorized intrusion?
• Are there security policies and procedures for use of the Internet and social
media, content security on all devices, and integrity of passwords, retention
and deletion of data?
• Are employees given notice concerning prohibited uses of their computer
equipment including a warning banner that notifies employees of their rights
(including no expectation of privacy) when using their grantee-owned computer?
• Is there routine IT security training for staff?
• Is the user’s system access granted based on roles and responsibilities?
• What are the backup procedures?
• Are test restores done periodically from the backups?
• What is the replacement cycle for technology equipment (desktops/laptops,
servers, printers, scanners, copiers, telephones, etc.)?
• What type of phone system does the program use?
• How old is it?
• When was the last upgrade?
• What reports can it provide?
• Who maintains it?
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Extent to Which Technology Enhances Program Operations and Service Delivery
Maximum use of technology is made to facilitate and enhance internal communication.
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• Does the program use technology effectively to enhance the efficiency of program operations and service delivery?
• How does the program use technology to facilitate and enhance communication?
• Does the program’s website effectively follow the Ernst and Young Best Practices (https://webassessment.lsc.gov/report/)?
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Areas of inquiry
Staff Training
Program staff are provided with appropriate training on the
use of technology.
Criterion 4. Financial administration.
The program has and follows financial
policies, procedures, and practices that
comport with Generally Accepted
• Does the program have a policy for the secure use of its technology, including
protecting data (including Personally Identifiable Information), use of the Internet and social media, password policies and if/when staff can bring their own
devices?
• Do staff understand and follow the policy?
• What software does the program use, including case management system
manufacturer and version?
• Are staff provided with ongoing training in its use?
Accounting Principles (GAAP),
requirements of the program’s funding
sources, and comply with federal, state
and local government regulations. The
Indicators
program has established sound internal
controls and conducts effective budget
planning and oversight.
Areas of inquiry
Fiscal Policies and Staff
The program has detailed written policies and procedures describing its financial operations which comply with all applicable requirements. The program follows such policies and
procedures.
The program has sufficient, capable, trained and effective
staff dedicated to financial administration.
• Is the program’s accounting manual current and updated as appropriate?
•
•
•
•
•
Top management and the governing body are actively involved in the budgeting process. The budget is updated
periodically and changes/variances are reviewed. The program engages in financial planning beyond the current
year.
The program maintains LSC funds held for immediate operating expenses in federally-insured bank accounts.
•
•
•
•
•
How many financial staff does the program have?
Does the program have competent financial personnel?
What is the training and background of the financial staff?
The job descriptions of personnel are clear and lay out the roles and responsibilities of each position.
Is periodic training given to program staff, management, and the governing
body regarding LSC regulations and accounting guide, as applicable?
Is the budget consistent with the program’s mission, goals, and objectives?
Does the program effectively adhere to its budget?
Is the budget updated monthly (or at least quarterly), based on changes in revenues or expenditures?
Does the program engage in financial planning beyond the current year?
Does the recipient adhere to LSC Investment Guidelines?
Board of Directors
The recipient’s governing body has fulfilled its fiduciary responsibility to the program through the establishment of a
financial oversight committee or committees. The financial
oversight committee(s) has at least one member who is a
financial expert or the board has access to a financial expert.
The governing body regularly determines the compensation
of the program’s Executive Director.
The Executive Director’s expenses are approved by a member of the board.
• Has the board established a financial oversight committee or committees that
perform the roles of a finance committee and an audit committee?
• Does the financial oversight committee collectively possess the knowledge to
set the strategic, financial course for the recipient and oversee management in
execution of the strategy?
• Does the financial oversight committee have the leadership of individual wellversed in non-profit GAAP, COSO Internal Control Framework, and other relevant standards and guidelines?
• Does the financial oversight committee meet on a regular basis?
• Does the committee have a charter or governing document and fulfill the responsibilities outlined therein?
• Does the financial oversight committee set the strategic direction of the recipient for financial and audit related matters?
• Does a governing body set and review the compensation of the Executive Director using an independent compensation consultant, comparable pay studies
from other nonprofit organizations, and/or a compensation survey?
• Are there procedures in place that require approval of the Executive Director’s
expenses by a member of the governing body?
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Audited Financial Statements
The program issues accurate financial statements on a timely
basis.
Executed one-time grants, such as TIG and PBIF awards,
are reported separately in the program’s audited financial
statements in accordance with 45 CFR 1628.3(e).
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• Are the audited financial statements submitted to LSC in accordance with the
LSC Audit Guide for Recipients and Auditors?
• Has the program submitted their audited financial statements in a timely manner over the last 3 years?
• Are executed one-time grants, such as TIG and PBIF awards, reported either
as a supplemental schedule of related revenue and expense or a separate column within the financial statement?
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Indicators
Areas of inquiry
Annual program audits do not reveal any significant problems
or issues; where such items have been identified, the program addresses them effectively and promptly.
• Do past audits or outside reports and evaluations reflect problems?
• Have any such problems been addressed?
• Is there any evidence of failure to comply with applicable funder or governmental requirements?
• What type of auditor’s report did the IPA issue regarding the financial statements? Unmodified or modified? If modified, why?
• What type of auditor’s report did the IPA issue regarding Federal Awards? Unqualified or Qualified? If qualified, why?
• Did the IPA issue findings in the audited financial statements? What were the
findings? Have they been addressed?
• Did the IPA issue a management letter? What did it contain? Has the recipient
addressed the issues?
• Are audit findings repeated from one fiscal year end to the next in the audited
financial statements?
• Does the recipient adequately address audit findings by performing the corrective actions outlined in the audited financial statements?
Internal Controls
• There is sufficient segregation of duties.
• Do the accounting policies and procedures require an appropriate level of supervisory review and adequate checks and balances to ensure the accuracy,
completeness and timeliness of transaction processing?
• The recipient has established and adheres to an adequate system of internal
control following the principles of the COSO Integrated Internal Control Framework.
The recipient has established and maintains adequate accounting records and internal control procedures. which is
designed to provide reasonable assurance of achieving the
following objectives: (1) Safeguarding of assets against unauthorized use or disposition; (2) reliability of financial information and reporting; and (3) compliance with regulations and laws that have a direct and material effect on the
program.
Contracting
The program has a contracting policy to prevent abuse, limit
waste of scarce funds, and prevent possible questioned
cost proceeding.
• Does the program have a contracting policy?
• Does the policy identify the contracting procedures for the various types of
contracts, dollar thresholds, and competition requirements?
• Is the process used for each contract action fully documented and is the documentation maintained in a central file?
• Is the required approval level (including items that need to be approved by
LSC) established for each contract type and dollar threshold, including when
the board of directors should be notified and/or give approval?
• Do policies include procedures for documenting and deviating from the approved contracting process, such as when sole-source contracts are executed?
• Is each contract or agreement executed with a price, time-period, and services
to be performed?
Fraud Prevention
•
•
•
•
•
•
The program has robust policies and safeguards in place to
prevent fraud.
•
•
•
•
•
Assess the organization’s segregation of duties.
Who has access to the program’s bank accounts?
How are permissions and authorizations assigned?
Does the program have Whistleblower and Conflict of Interest Policies?
Is the program’s IT infrastructure adequately secure?
Is the physical and logical access to the program’s computer network adequately secure?
Does the program’s governance and management of IT resources promote effective operations and provide a robust system of internal control?
Do the program’s computer applications incorporate and facilitate a robust system of internal control?
Have thorough and well documented hiring practices and procedures?
Are staff periodically trained or reminded of the Whistleblower and Conflict of
Interest Policies?
Does the program employ computer banners on all servers, computers and
devices to inform employees of prohibited use activities and no right to privacy
of grantee equipment?
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Cash Disbursements
The program’s disbursements are approved in writing by an
authorized individual.
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• Are procedures adequate to provide that salary and wage rates are approved
by an authorized individual and employees are paid in accordance with approved wage and salary plans?
• Were invoices properly approved, with dates, before disbursement checks
were processed?
• Do policies and procedures for disbursements address unallowable expenses,
purchase approvals, securing and approving new vendors, segregation of purchasing duties, and duplicate payment controls?
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Areas of inquiry
The program’s criteria and procedures for purchases are
documented.
• Is there a procedure for proper payment and approval of expenditures at an
appropriate level of management?
Cash Receipts
The program has established internal control procedures related to cash receipts.
The program maintains a client trust fund and accounting
system to account for funds held on the client’s behalf.
• Is initial accountability for cash established as soon as a cash item is received?
• Do the accounting records adequately identify all cash receipts as to source
and purpose?
• Is an effective chain of custody in place for cash receipts?
• Has the program established a method to determine the balance for each client trust account?
• Does the program have a process to ensure that dormant funds are escheated
to the state in compliance with state requirements?
Asset and Property Records
A physical inventory of property purchased with LSC funds is
conducted at least once every two (2) years and the results are reconciled with property records.
The program has established adequate internal controls to
safeguard its petty cash funds.
• Is a physical inventory conducted at least once every two (2) years?
• Are any differences between the physical inventory and the accounting records
reconciled?
• Is there a surprise count of petty cash conducted periodically?
• Are the petty cash and client trust funds secured in locked location?
• Are all petty cash disbursements supported by an original receipt or appropriate supporting documentation?
Subgrants
The program has established adequate procedures related to
the subgranting of LSC funds to ensure compliance and
proper fiscal oversight.
• Does the subgrant agreement or contract with the sub recipient specify financial reporting responsibility?
• Where a relationship with a sub recipient exists, do the notes to the financial
statements of the recipient and subrecipient fully disclose the nature of that relationship?
Bonding of Recipients
The program maintains fidelity bond coverage at a minimum
level of at least ten (10) percent of the program’s
annualized LSC funding level for the previous fiscal year,
or of the initial grant or contract.
The program carries adequate fidelity bond coverage for all
staff required to be bonded.
• Does the program carry at least the minimum level of fidelity bond coverage
for fraud and employee dishonesty as described in 45 CFR Part 1629?
• Does the program carry fidelity bond coverage for all staff required to be bonded: Every director, officer, employee and agent of a program who handles
funds?
Accounting Software
The program’s accounting software is appropriate to support
the operations and financial oversight of the organization.
The program limits access to its accounting software .............
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Criterion 5. Human resources
administration. The program promotes
organizational excellence through the
recruitment, management, and retention
of a high-performing, diverse workforce
consistent with its mission and goals.
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• Does the program use up-to-date technology to enhance efficient financial operation?
• Is the software appropriate to support the operations of the organization?
• Does the accounting software incorporate adequate internal controls?
• Is the recipient effectively using the software to ensure internal controls are in
place?
• Does the program limit access to its accounting software?
• Does each user have his/her own password security based on their fiscal functions and are accounting software passwords changed periodically?
• Is a user’s system access granted based on roles and responsibilities?
The program develops and
communicates sound policies and
procedures that ensure compliance with
applicable federal, state, and local laws
and has a knowledgeable, accessible,
and professional staff to the program in
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the areas of recruitment and retention,
training, professional development,
compensation and benefits, performance
appraisal, and organizational governing
personnel development.
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Areas of inquiry
Human Resources Staffing and Workplace Policies
The program has sufficient, capable, trained, and effective
professional staff assigned to human resources administration.
The program has an employment handbook or manual with
policies on hiring, supervision, promotion, compensation,
and termination that are in compliance with applicable federal, state, and local laws.
The program engages in human resources planning and policies are reviewed periodically.
The program maintains accurate and timely personnel files
and protects the confidentiality of personnel records as required by applicable law and contract.
The program has a document retention policy for personnel
files and that policy is adhered to by managers.
• Who is responsible for the human resources functions within the program?
• If responsibilities are shared, how are duties defined?
• What is the background, experience and training of staff responsible for handling human resources?
• What is the interaction between the human resources and finance staff?
• Does the program have an employment handbook or manual with human resources policies?
• Does the handbook or manual include Conflict of Interest and Whistleblower
policies?
• Does the handbook or manual include an ethics policy?
• What is the program’s plan to maintain HR’s knowledge of best practices?
• How often are the policies reviewed and updated?
•
•
•
•
Where are personnel files kept?
Are they paper or electronic?
Who is responsible for maintaining personnel files?
Are there procedures to control access to personnel files and protect the confidentiality of employees?
• Does the program have a document retention policy for personnel files?
• How long are they kept?
• Where are they stored after employees separate from the organization?
Program Staffing, Recruitment, and Retention
The program has a capable, culturally competent, and diverse staff.
The program has a comprehensive recruitment strategy that
employs a variety of methods and sources to recruit highly
qualified candidates.
The program has a formal orientation process for all new
hires.
The program is able to forecast and determine its human resource needs and tracks fluctuations in the workforce, including turnover rates.
• What is the current composition of the staff?
• Is the current composition of the program staff diverse in terms of experience,
gender, race, and disability status?
• Does management create and sustain an environment that values and supports a diverse workforce?
• Has the program adopted a disability inclusion plan?
• What are the program’s recruitment practices?
• What recruitment methods and sources are used? (e.g., online employment
sites, job boards, referrals, social media, search firms)?
• Are the job descriptions up-to-date and do they accurately explain job functions
and separate essential from nonessential functions?
• Are there job descriptions for all positions?
• Is there a new hire orientation and is the orientation period defined?
• What is the rate of turnover in the program?
• Does the program evaluate internal and external factors related to turnover?
• What is the average length of time an employee stays with the organization, by
position type and category?
• Does the program experience a high level of employee grievances?
• Does the program have an effective plan to develop and retain new attorneys
and paralegals (e.g. professional advancement along a defined career path)?
• Are individual development plans created for each employee?
Compensation & Benefits Policies
The program has a compensation and benefits structure that
promotes staff recruitment, retention and professional development.
The program periodically assesses salaries, employee benefits, bonuses and COLAs.
• What are the program’s fringe benefits and retention policies, such as a loan
repayment assistance program, retirement plans, health insurance, and other
financial and non-financial benefits?
• Does the program regularly review its compensation structure and benefits?
• Does that review include assessing market-based compensation studies?
Staff Evaluation and Training
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The program conducts regular and effective evaluations of all
staff.
The program leverages its budget appropriately for training
opportunities that would benefit its entire staff.
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Does the program conduct performance evaluations or appraisals?
If yes, how often?
Does the program use a performance evaluation instrument?
Is this evaluation linked to the program’s goals, vision, or strategic initiatives?
Do such evaluations include setting goals for staff?
Does the program foster an environment that emphasizes continuous learning,
constructive feedback, improvement and excellence?
• What training is available to staff?
• Do all staff members have access to training opportunities?
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Areas of inquiry
The program conducts ongoing training for all staff on program policies, procedures, technology, and in substantive
legal areas and advocacy skills.
• Is there a formal, ongoing training for employees and managers (e.g., procedures, policies, technology, substantive legal areas)?
• Who is responsible for planning and conducting training of existing employees?
• Does the program ensure all staff receive regular training on the LSC Code of
Conduct and LSC’s Grant Terms and Compliance requirements?
• Does the program have a policy highlighting the importance of alerting the Office of Inspector General (OIG) to potential indicators of fraud, waste, and
abuse of program funds and the requirement to do so promptly for loss over
$200?
• Does the program have a policy for identifying compliance concerns? Does the
program train staff on the policy and reporting compliance concerns?
• Does the program provide effective leadership and management training and
support to mid-level supervisors and personnel engaged in administration and
management?
• Is there cultural competency training for all staff?
• Have they attended?
The program provides effective training for management and
administrative staff.
The program regularly conducts cultural competency training
for all staff.
Staff Morale and Workplace Climate
To the extent that there are or have been serious morale or
other internal personnel problems, the program is addressing or has addressed them effectively, and is taking or has
taken appropriate steps to prevent their recurrence.
The program has developed a process to address internal
complaints, suggestions, and feedback.
Program offices are professional and provide adequate
space for conducting the program’s work.
Criterion 6. Overall management and
administration. The program is well
managed and administered: Including
management structure; processes and
systems to ensure compliance with all
• What is the recent history and current status of staff morale?
• Does LSC’s employee survey indicate significant leadership challenges?
• Does LSC’s employee survey indicate friction among staff members?
• Does the program have a process accepting and resolving employee grievances?
• Are program offices professional?
• Do they provide adequate space for conducting the program’s work, provide
appropriate privacy?
• Does the program provide adequate maintenance services?
funder requirements and state and
federal law; capacity to address
problems quickly and effectively, robust
intra-staff and staff-management
communications; effective
Indicators
administrative procedures; allocation of
appropriate resources to management
functions; and periodic evaluations of
administrative operations.
Areas of inquiry
Allocation of Resources
The program devotes appropriate resources to management
The program has a management structure that effectively
uses middle managers.
The mix of program staff (managers, case handlers, and administrative staff) maximizes program resources to ensure
the effective and efficient delivery of client services.
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The program allocates appropriate resources to internal compliance.
• Does the program devote an appropriate level of resources to management
and administration?
• What is the span of control in each division (i.e. what is the management to direct reporting ratios within the organization)?
• How many middle managers are there?
• Has the program made considered choices regarding the proportionality of
non-advocacy staff as compared to case handlers, consistent with program resources, number of case handlers, and type of work?
• Has the program established a risk management program/group to review and
mitigate management systems risks? Such risks could include: Performance
management (failure to achieve performance goals including implementation of
the Strategic Plan); human capital management (failure to attract, motivate,
and retain high quality staff); information management (failure to collect and
share vital operational data and inability to support stable and safe IT operations, including the case management system); acquisitions management
(higher contract costs and possible fraud, waste, and abuse risks).
• Does the program have a compliance officer (or someone who serves in that
role) to ensure compliance concerns are reported and managed effectively and
efficiently?
Decision Making Processes
The program makes major decisions in a way that incorporates relevant information and input.
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What is the program’s decision making process?
Is decision making authority clear when delegated?
Is decision making timely and effective?
Do staff members know whom to go to for decisions?
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Indicators
Areas of inquiry
The program has procedures for obtaining input on significant decisions, and for resolving complaints and problems
effectively and timely.
• Do staff feel that their input is sought on significant decisions?
• Do staff feel that decisions are quickly and effectively communicated to all who
are affected?
• Does the program resolve employee complaints and problems effectively and
timely?
• Is there any evidence of non-compliance with state and federal laws, rules,
and regulations?
The program’s administrative structure, processes, and systems support compliance with state and federal laws, rules,
and regulations.
The program’s administrative structure, processes, and systems support compliance with funder requirements.
• Is there any evidence of non-compliance with funder requirements?
Continuity of Operations
The program has developed and regularly updates an emergency plan to maintain operations and to minimize disruption in the event of an emergency.
The program has a plan for providing client services in the
event of a disaster or emergency affecting its client community.
Criterion 7. General resource
development. Consistent with the
program’s mission, the program seeks to
maintain and expand its base of funding
• Does the program have a plan in the event of an emergency or disaster?
• If yes, does the plan include:
—The preservation of files, equipment, and computer data bases;
—A process for communication between staff and management;
—For the relocation of the program’s work sites?
• Does the program attempt to coordinate with state/local emergency response
and preparedness entities?
• Does the program have a plan for providing client services in the event of a
disaster or emergency affecting the client population?
with the goal of enhancing program
services and organizational
sustainability. The program implements
a strategy designed to identify funding
Indicators
sources to advance the mission and
goals of the program.
Areas of inquiry
Staffing
The program has attempted to develop, and to the extent
possible, has effective relationships with other major institutional resources in the service area that are involved or
might be able to provide some support in the provision of
legal assistance to eligible clients, as well as help in expanding program funding.
The program has sufficient, capable, trained, and effective
staff dedicated to resource development, or uses consultant(s) or other organizations to supplement or lead that effort.
The program has delineated responsibilities for resource development staff and communication (if applicable) staff.
The program has engaged the board and staff in resource
development and has provided adequate training.
• Who are the program’s other major funders?
• What percentage of non-LSC funding does the program receive?
• How many of the funders have funded before or made multi-year commitments?
• Who is responsible for the resource development efforts within the program?
• Is the number of staff assigned to resource development appropriate given the
size of the program and level of funding?
• What are the duties for the person(s) responsible for these efforts?
• How are those responsible for resource development evaluated for this work?
• How are the resource development activities integrated with the program’s external communication efforts?
• Does the program employ a separate staff person to handle the program’s
communications?
• Are staff and board actively engaged around resource development efforts?
• Have staff and/or board members received training on resource development
or fundraising?
• If yes, who conducted the training?
• Does the program have an advisory board that focuses on resource development, or does the board have a resource development committee focused on
such activities?
• Does the program’s governing body involve non-members with expertise in resource development?
Resource Development Plan & Implementation
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The program has a written plan describing its strategy to ensure that the program is supported by sufficient financial
resources consistent with its mission.
The program has a diverse funding stream and continually
explores opportunities for increased funding.
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• Does the program have a written resource development plan, and is resource
development a part of its overall strategic plan?
• Does the plan identify possible funding sources and specific and realistic fundraising goals?
• How often is this plan reviewed by management? By the board?
• Does the program employ social media as a tool for increasing program revenue?
• Has the program achieved diversity in funding: federal, state, local governments; individual donors; law firms; foundations; bar campaigns, restricted/unrestricted gifts?
• What is the percentage of each funder type of the current budget?
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Areas of inquiry
The program is innovative in trying to develop new sources ..
The program uses former and existing clients and former
board members as a part of its funding efforts.
The program sponsors events and activities to recognize its
individual donors and supporters.
•
•
•
•
•
•
•
•
•
What tools does the program employ to engage new and existing donors?
How are new and existing donors cultivated?
How are donors acknowledged?
Has the program conducted a feasibility study to determine the benefits and
risks associated with its funding efforts?
Does the program have an endowment?
If yes, what are the permissible uses of the endowment?
Does the program engage former clients in its funding efforts?
Does the program engage former board members in fundraising and encourage them to contribute themselves?
Does the program host donor recognition and cultivation events? How often?
Monitoring and Evaluation
The resource development plan has been approved by the
board, is reviewed annually, and is consistent with the program’s budget.
The program has a process to evaluate cost effectiveness of
resource development activities.
The program has carefully evaluated whether the requirements of prospective funding sources are consistent with
the program’s mission, goals, priorities, objectives, and
strategies.
The program has developed a system to track donor gifts
and other funding. This system is integrated with other systems including the accounting software.
The program monitors its efforts to ensure that its mission is
being communicated accurately and clearly to potential donors and funders.
The program seeks both monetary and in-kind support from
donors, corporations, and other funders.
• Is the cycle of organizational budgeting in line with the resource development
plan?
• How does the program evaluate the cost effectiveness?
• How does the program decide the priorities for funding?
•
•
•
•
How does the program track gifts from donors and other funding sources?
Does the program use fundraising or donor software?
If so, which one?
What efforts does the program make to ensure that its mission is being communicated accurately and clearly to the potential donors and funders?
• What is the mix of support the grantee receives from various donors?
other components; emphasizes
innovation and creativity in delivery; is
informed by current information
concerning delivery research; is wellsuited to meeting the most pressing
legal needs of the service area; and,
Criterion 8. Coherent and
comprehensive delivery structure.
Overall, the program management
maintains a delivery structure and
approach that effectively utilizes and
integrates staff, private attorneys, and
given available resources, constitutes an
effective and economical balancing of
expenditures on the various functions
and activities described in the four
Performance Areas.
Indicators
Areas of inquiry
The program has a reasonable, thoughtful and effective overall delivery system, which utilizes and integrates staff, private attorneys, volunteers, branch offices, outreach, and
alternative delivery methods, and which strikes an effective
balance on key issues such as specialization, experience
of staff, use of attorneys and paralegals, and other major
design choices.
The program’s choices about allocation of resources to competing activities and functions are reasonable and balanced, and consistent with its mission, goals, priorities, objectives, and strategies.
• Does the program have in place and regularly use systems to gauge the efficiency and effectiveness of its overall delivery system?
• Is there evidence of actual assessment of efficiency and effectiveness?
• Is there evidence of change as a result of that assessment?
• Is there evidence of experimentation and innovation?
Criterion 9. Participation in an
integrated legal services delivery system.
The program participates in, and seeks
to expand and improve, statewide (and
regional if relevant) legal assistance
delivery systems to achieve equal access
to justice and to meet the civil legal
needs for low-income persons in the
state.
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Indicators
Areas of inquiry
The program participates in statewide (and regional if relevant) efforts to provide low-income persons in the state
with equal access to a full range of civil legal assistance
services in all forums.
• Is the program engaged in statewide efforts (and regional efforts if relevant) to
achieve the availability of a full range of civil legal assistance in all available forums?
• Does the program participate in statewide (and regional if relevant) oversight
activities to achieve an integrated statewide delivery system?
• Is the program engaged in statewide efforts (and regional efforts if relevant) to
eliminate barriers to access and provide meaningful services to low-income
persons in the state?
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Indicators
Areas of inquiry
The program participates in local, statewide (and regional if
relevant) efforts to maximize the effective use of available
human and financial resources and to increase such resources to better address the civil legal needs of the
state’s low-income populations.
The program coordinates with other providers, the bar, law
schools, and other relevant entities in seeking to ensure
that support is provided to advocates and managers, including training, dissemination and exchange of information, and communication and coordination among practitioners in key areas of law and practice.
The program participates in statewide planning and oversight
activities to achieve an integrated statewide delivery system, and coordinates and collaborates with other civil legal
aid providers, private attorneys, government and corporate
attorneys, the organized bar, courts and court personnel,
law schools, and other public and private entities that provide legal and other social services to low-income persons.
• Is the program engaged in statewide efforts (and regional efforts if relevant) to
utilize existing financial and human resources effectively and efficiently?
• Is the program engaged in statewide efforts (and regional efforts if relevant) to
increase potential sources of funding, including financial resources, volunteer
and in-kind resources?
• Is the program engaged in statewide efforts (and regional efforts if relevant) to
provide support to advocates and managers, including training, dissemination
and exchange of information, and communication and coordination among
practitioners in key areas of law and practice?
Dated: March 27, 2018.
Stefanie K. Davis,
Assistant General Counsel.
[FR Doc. 2018–06532 Filed 3–30–18; 8:45 am]
BILLING CODE P
LEGAL SERVICES CORPORATION
Sunshine Act Meeting
The Legal Services
Corporation’s Board of Directors and its
six committees will meet April 8–10,
2018. On Sunday, April 8, the first
meeting will commence at 2:00 p.m.,
Eastern Daylight Time (EDT). On
Monday, April 9, the first meeting will
commence at 9:00 a.m., EDT, with the
next meeting commencing promptly
upon adjournment of the immediately
preceding meeting. On Tuesday, April
10, the first meeting will commence at
9:00 a.m., EDT and will be followed by
the closed session meeting of the Board
of Directors that will commence
promptly upon adjournment of the prior
meeting.
LOCATION: Legal Services Corporation,
3333 K Street NW, 3rd Floor F. William
McCalpin Conference Center,
Washington, DC 20007.
PUBLIC OBSERVATION: Unless otherwise
noted herein, the Board and all
committee meetings will be open to
public observation. Members of the
public who are unable to attend in
person but wish to listen to the public
proceedings may do so by following the
telephone call-in directions provided
below.
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DATE AND TIME:
Call-In Directions for Open Sessions
• Call toll-free number: 1–866–451–
4981;
• When prompted, enter the
following numeric pass code:
5907707348
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• As part of its efforts to expand access, provide a full range of services, maximize resources, and ensure support within the state, does the program coordinate and collaborate with other civil legal aid providers, private attorneys, government and corporate attorneys, the organized bar, courts and court personnel, law schools, and other public and private entities that provide legal and
social services to low-income persons?
• Once connected to the call, your
telephone line will be automatically
‘‘MUTED’’.
• To participate in the meeting during
public comment press #6 to ‘‘UNMUTE’’
your telephone line, once you have
concluded your comments please press
*6 to ‘‘MUTE’’ your line.
Members of the public are asked to
keep their telephones muted to
eliminate background noises. To avoid
disrupting the meeting, please refrain
from placing the call on hold if doing so
will trigger recorded music or other
sound. From time to time, the presiding
Chair may solicit comments from the
public.
by management and LSC’s Inspector
General, and to consider and act on the
General Counsel’s report on potential
and pending litigation involving LSC,
and on a list of prospective funders.**
Institutional Advancement
Committee—Open, except that, upon a
vote of the Board of Directors, the
meeting may be closed to the public to
consider and act on recommendation of
new Leaders Council invitees and to
receive a report on Development
activities.**
Audit Committee—Open, except that
the meeting may be closed to the public
to hear a briefing on the Office of
Compliance and Enforcement’s active
MEETING SCHEDULE
enforcement matters.**
Governance and Performance Review
Time *
Committee—Open, except that the
Sunday, April 8, 2018:
meeting may be closed to the public to
1. Operations & Regulahear a report on the President’s
tions Committee .........
2:00 p.m. evaluation of other officers.**
Monday, April 9, 2018:
A verbatim written transcript will be
1. Finance Committee ...
9:00 a.m.
2. Audit Committee.
made of the closed session of the Board,
3. Institutional AdvanceInstitutional Advancement Committee,
ment Committee.
and Audit Committee meetings. The
4. Communications Subtranscript of any portions of the closed
committee of the Instisessions falling within the relevant
tutional Advancement
provisions of the Government in the
Committee.
Sunshine Act, 5 U.S.C. 552b(c)(6) and
5. Governance and Performance Committee.
(10), will not be available for public
6. Delivery of Legal
inspection. A copy of the General
Services Committee.
Counsel’s Certification that, in his
7. Board of Directors.
opinion, the closing is authorized by
Tuesday, April 10, 2018:
1. Board of Directors .....
9:00 a.m. law will be available upon request.
* Please note that all times in this notice are
in Eastern Daylight Time.
Open, except as
noted below.
Board of Directors—Open, except
that, upon a vote of the Board of
Directors, a portion of the meeting may
be closed to the public to hear briefings
STATUS OF MEETING:
PO 00000
Frm 00118
Fmt 4703
Sfmt 4703
** Any portion of the closed session consisting
solely of briefings does not fall within the Sunshine
Act’s definition of the term ‘‘meeting’’ and,
therefore, the requirements of the Sunshine Act do
not apply to such portion of the closed session. 5
U.S.C. 552b (a) (2) and (b). See also 45 CFR 1622.2
& 1622.3.
E:\FR\FM\02APN1.SGM
02APN1
]]>Agencies
[Federal Register Volume 83, Number 63 (Monday, April 2, 2018)]
[Notices]
[Pages 14047-14060]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-06532]
=======================================================================
-----------------------------------------------------------------------
LEGAL SERVICES CORPORATION
Notice of Revisions to Performance Area Four of LSC's Performance
Criteria
AGENCY: Legal Services Corporation.
ACTION: Notice of revisions to guidelines.
-----------------------------------------------------------------------
SUMMARY: To provide grantees with the most effective guidance, in 2018
the Legal Services Corporation revised Performance Area Four to refine
and expand the areas of inquiry to focus on those criteria for which
LSC has found the most deficiencies, particularly Criteria 1 (Board
Governance), 4 (Financial Administration), and 7 (General Resource
Development). The 2018 revisions codify the work of LSC staff with
numerous grantees and provide evidence-based guidance to recipients on
how to run a high-performing nonprofit organization.
FOR FURTHER INFORMATION CONTACT: Lynn Jennings, Vice President for
Grants Management, Legal Services Corporation, 3333 K Street NW,
Washington, DC 20007, (202) 295-1645, [email protected].
SUPPLEMENTARY INFORMATION: LSC's Performance Criteria indicate that
legal services programs should be led and managed effectively with
high-quality governance, administrative systems, procedures, and
policies. Good leadership and strong internal operations increase the
likelihood of effective program services for clients.
Over the past several years, LSC has observed some areas of
weakness in grantee governance through performance quality visits,
compliance reviews, and Office of Inspector General (OIG) visits. The
2018 revisions codify the work of LSC staff with numerous grantees and
provide evidence-based guidance to recipients on how to run a high-
performing nonprofit organization.
Since 2010, LSC's Office of Program Performance has conducted 133
Program Quality Visits of 124 grantees. LSC issued 1,901 Tier One \1\
recommendations across the reports summarizing those visits. Of the
1,901 Tier One recommendations, 695 recommendations--36.5%, the most of
any performance area--pertained to Performance Area 4. From 2011 to
2016, LSC's Office of Compliance and Enforcement conducted 111
Compliance Reviews of 106 grantees. LSC issued more than 1,200 Required
Corrective Actions (RCAs) related to both regulatory and fiscal issues.
Approximately 25% of the RCAs identified deficiencies in the grantees'
financial administration. Additionally, OIG conducted 41 A-50 reviews
between June 2012 and September 2017. As a result of those reviews, the
OIG made 160 referrals to OCE. The referrals covered issues related to
timekeeping, deficiencies in policies and procedures, cost allocation,
and internal controls.
---------------------------------------------------------------------------
\1\ According to LSC's Office of Program Performance Procedure
Manual:
Tier One Recommendations are those recommendations that
are determined to be significant and will be included in the next
Request for Proposal to the grantee.
Tier One Recommendations are those that if addressed,
have the potential for significantly improving program quality and/
or program performance within the short term, i.e., two years.
A Tier One Recommendation must:
be stated in simple straightforward terms such that
there is no doubt by the program that a response is required; and
have an objective, the value of which equals or
outweighs any additional burden that the recommendation imposes on
the program (does not apply to statutory or regulatory
requirements).
---------------------------------------------------------------------------
This is the background against which LSC evaluated the existing
criteria for Performance Area 4. The statistics above gave LSC valuable
information about which areas of grantee administration, leadership,
and governance needed more rigorous evaluation.
These Performance Criteria are guidelines for ensuring high program
quality. They are not requirements. They reflect best practices to
which programs should aspire and which they should, to the extent
possible and consistent with program resources, attempt to achieve.
These revisions do not reflect a change in the purposes of the
Performance Criteria stated in the Introduction to the 2007 revised
version. The purposes of the Performance Criteria are twofold. First,
the Performance Criteria ``guide LSC's assessments of program
performance generally and in the competitive grants process.'' Second,
the Performance Criteria serve as a ``useful framework for internal
program self-evaluations, planning, and program development, as well as
external peer reviews and expert assessments by other funding
sources.''
LSC will begin using the revised Performance Area 4 on June 1,
2018. LSC management recognizes that it may take time, guidance, and
experience for all grantees to adjust to the revisions. LSC will,
therefore, provide training and forums to discuss the implementation of
the changes. When conducting program assessments, LSC staff will take
the scope of the revisions and each program's capacity into
consideration when making recommendations.
As the table below indicates, LSC reorganized the order of the
Performance Criteria. The current Criterion 3--Overall Management and
Administration--includes a limited review of a grantee's technology
infrastructure and administration. To more accurately reflect the role
technology plays in the daily operations of an organization and in
providing efficient and effective client services, LSC proposed
creating a separate, new technology criterion, Criterion 3: Technology
Infrastructure and Administration. The criterion for Overall
Administration and Management would now be Criterion 6, with Internal
Communication being folded into the proposed Criterion 6.
[[Page 14048]]
Performance Area 4: Criterion Ordering
------------------------------------------------------------------------
Current ordering of Performance 2018 Revised ordering of Performance
Area 4 Criteria Area 4 Criteria
------------------------------------------------------------------------
Criterion 1: Board Governance.... Criterion 1: Board Governance
Criterion 2: Leadership.......... Criterion 2: Leadership
Criterion 3: Overall Management Criterion 3: Technology
and Administration. Infrastructure and Administration
Criterion 4: Financial Criterion 4: Financial Administration
Administration.
Criterion 5: Human Resources Criterion 5: Human Resources
Administration. Administration
Criterion 6: Internal Criterion 6: Overall Management and
Communication. Administration
Criterion 7: General Resource Criterion 7: General Resource
Development and Maintenance. Development and Maintenance
------------------------------------------------------------------------
Criterion 1. Board Governance. The program articulates a clear
mission for the organization. Each board member demonstrates commitment
to the program and its mission through consistent engagement in Board
activities that involve all other board members. The board effectively
engages in strategic organizational planning with program leadership
and staff. It is responsible for major policy decisions, while holding
organizational management accountable for effective performance of
their responsibilities. The board assists with or oversees, as
appropriate, the organization's efforts to develop and maintain
resources. The board also promotes public awareness of the program in
the community in a manner that aims to enhance the program's overall
effectiveness and influence.
------------------------------------------------------------------------
Indicators Areas of inquiry
------------------------------------------------------------------------
Board Composition, Size and Tenure
------------------------------------------------------------------------
As a whole, the board is Is the board membership diverse
appropriately diverse and and representative of the service area?
representative of the various Is the board either composed of
geographical areas and low- an appropriate mix of members that are
income populations served by sufficiently expert in areas applicable
the program. to the program's operations and
achievement of overall goals related to
the mission--e.g. non-profit
management, financial oversight,
fundraising, community engagement--or
has it taken steps to ensure that such
expertise is available to the board on
a consistent basis?
Does the board adhere to LSC
regulations regarding board
composition?
The size of the board is Is there evidence that the
conducive to effective board's size facilitates the
oversight. effectiveness of its operation?
When determining board tenure, What is the tenure of each of
the board struck a balance the board members, including the board
between longevity and board chair(s)?
experience and the need for Does the organization impose
new ideas and insights. term limits on board membership?
If so, what are the term
limits?
Does the board have a policy or
practice regarding length of service on
the board and on its Executive
Committee?
If the board imposes term
limits, how does the organization avoid
the loss of the experience and
expertise of valued directors?
Is there a process for removing
board members?
The board has processes and Does the board have and follow
procedures for recruiting and established policies and practices
orienting new board members. regarding recruitment, qualification
and retention and engagement of new
members?
Is there a job description for
board members explaining their role and
duties?
Is the job description provided
to board members?
Is there an onboarding process
for new members?
Are board members given
appropriate orientation and continuing
training, including: training on the
role of the board, potential conflicts
of interest, and on fiscal, fiduciary,
and other responsibilities?
Is there training on the LSC
Act, LSC regulations, LSC performance
criteria, and other best practices?
------------------------------------------------------------------------
Board Committees
------------------------------------------------------------------------
The board's committees What is the board's committee
structure promotes effective structure?
oversight of the organization. What is the composition of each
committee?
Does each committee have
clearly defined responsibilities that
are documented in written form?
If so, is there periodic review
and updating of the documents?
Is there a committee
responsible for assessing the
performance of the board?
Is there an executive
committee, and, if so, what is its
composition?
How often does the executive
committee meet?
What is the scope of business
usually conducted?
Is there a separate Finance or
Audit Committee?
Does a member of the audit or
finance committee have a financial
background?
If not, does the committee
engage sufficient assistance from non-
board sources to provide consistent and
competent guidance on financial
matters?
Is there a separate fundraising
committee?
------------------------------------------------------------------------
[[Page 14049]]
Board Meetings and Deliberations
------------------------------------------------------------------------
The board fulfills the meeting The board of directors meets at
requirements of LSC least four times a year.
regulations. There is public notice of
meeting and meetings are public.
The board has quorum Is the board required to reach
requirements that are adhered a membership attendance quorum before
to it can take formal action?
What is the percentage or
number requirement for a quorum?
How many times within the past
two years has the board tried to meet
but has not had a quorum?
If there is no quorum, what
percentage of the board attended each
meeting?
Does the organization permit
its board to act through virtual
meetings such as email voting, in
addition to remote participation by
teleconferences or videoconference?
Are there guidelines or a
protocol for virtual meetings?
The board and committee Are there pre-circulated
meetings are well planned and agendas for all board and committee
focused to ensure that the meetings?
board and its committees can If so, who sets the agenda?
carry out their oversight Do the board chair or committee
function. chair and the executive officer
contribute to the agenda?
Meeting materials............. Do individual members feel that
the board packets distributed in the
board and committee meetings provide
them with useful information about the
program and equip them to participate
meaningfully in the board or committee
meeting?
What is the quality of the
materials?
How far in advance is board
information circulated?
Do board materials contain
updated financial information?
Executive session............. Do board meetings include an
executive session without any staff
(including the executive director)?
The board members are engaged What is the level of attendance
and regularly attend and at board and committee meetings?
participate in board and Do individual members prepare
committee meetings. for and participate in meetings?
Are client board members
actively engaged in board meetings and
decisions?
Board and committee decisions Are board decisions
are appropriately documented. appropriately documented in board
minutes?
Minutes of full board and
committee meetings are prepared,
reviewed and approved by the board at
least by the next scheduled meeting.
Who prepares the meeting
minutes?
Apart from minutes of board
meetings, does the board maintain a
separately indexed chronological record
of resolutions that reference their
initial date of adoption and subsequent
actions?
------------------------------------------------------------------------
Board Transparency and Accountability
------------------------------------------------------------------------
The board and members Is the board supportive of the
individually, are committed program?
to the program and its Does the board have a policy or
mission. The board properly practice that effectively deals with
discloses and manages any conflicts of interest or potential
organizational or personal conflicts of interest?
conflicts. Is the policy or practice in
writing?
Are organizational or
individual conflicts addressed quickly
and effectively?
------------------------------------------------------------------------
Board Engagement with Strategic Planning
------------------------------------------------------------------------
The board ensures that the Does the board adopt a mission
program establishes and statement, that has been
adheres to effective collaboratively developed with
strategic planning. management?
Does the board establish a
vision for the future?
Does the board approve
strategic goals?
Does the board articulate core
values/principles?
What is the board's role in
developing the strategic plan?
Does the board work in close
partnership with the management to
ensure a successful planning process?
Does the board regularly review
progress in accomplishing the goals of
the strategic plan and take appropriate
action to ensure implementation?
Does it periodically discuss
progress toward strategic goals with
program management?
------------------------------------------------------------------------
Board Oversight of the Organization--Programmatic
------------------------------------------------------------------------
The board is involved in major How are major policy decisions
policy decisions, aware of made?
issues in and performance of Do board members understand and
the program, while leaving adhere to clear distinctions between
day-to-day management of board governance and program
program operations to program management?
management personnel. Do board members understand the
major issues at stake for the program?
How does the board exercise its
oversight of program operations?
Does the board receive regular
reports providing objective data on
program performance?
Monitoring: Does the board
receive periodic information on the
work of the program?
Evaluating: Does the board seek
information to evaluate the
effectiveness of the program's
services?
------------------------------------------------------------------------
[[Page 14050]]
Board Oversight of the Organization--Financial
------------------------------------------------------------------------
The board exercises effective Are board members aware of and
financial oversight. accurate in their perception have a
general understanding of the
requirements of the program's funding
sources.
What systems and procedures
does the board have to ensure effective
financial oversight?
Ensure funds are used for How often does the board review
intended charitable purposes, financial statements and do they
and funds are appropriately understand what the financial
accounted for. statements say?
Do they have experience in or
guidance from board members or other
advisors in interpreting the financial
statements?
Is there a finance and/or audit
committee to select the independent
auditor?
Is the Form 990 presented to
the board and management team prior to
or after it is filed with the IRS?
Are there opportunities for the
CFO/Controller or highest ranking
financial officer to confer with the
board, or members of the board?
Has the board established
budget guidelines?
The board safeguards Are policies in place to
investments. evaluate the organization's investment
decisions and performance?
Are policies in place to
safeguard the organization's assets and
tax-exempt status?
------------------------------------------------------------------------
Evaluation of the Executive Director
------------------------------------------------------------------------
The board effectively What is the process for
evaluates the chief executive evaluating the Executive Director and
officer or executive director. other top officers in the organization?
Do they employ a 360
evaluation?
Who is involved in the
evaluation process?
How frequently does the board
evaluate the chief executive officer or
executive director?
What, if any, are the criteria
used for evaluating the Executive
Director?
The boards practices Is there a process for
appropriate oversight over reviewing and setting executive
the Executive Director's compensation?
Compensation plan. If so, what is the process?
Who is involved in this
process?
Are all board members aware of
the Executive Director's entire
compensation package?
Is the Executive Director's
compensation based on market data?
Is there contemporaneous
substantiation of the board's
deliberation and decision on the
Executive Director's compensation?
------------------------------------------------------------------------
Board's Role as Ambassador for the Organization
------------------------------------------------------------------------
The board effectively promotes Do individual members,
and expands the reach and including client members, speak on
influence of the program in behalf of the organization to external
the communities it serves. audiences at appropriate opportunities?
Is there a protocol for who
speaks on behalf of the board and the
organization?
Does everyone know the
``elevator speech?''
Do individual members represent
the community to the organization by
bringing back concerns, ideas,
suggestions and compliments when they
have merit or possibility?
------------------------------------------------------------------------
Board's Role in Resource Development
------------------------------------------------------------------------
The board effectively promotes Do board members assist
and expands the reach and effectively in fundraising and
influence of the program in development activity?
the communities it serves, Does the board consult and
and develops additional communicate with the Executive Director
resources for the program. to identify and, where appropriate,
pursue all types of needed resources?
Determines how board members
will participate in fundraising from
sources where they have knowledge or
influence, such as the private bar?
Does the board receive regular
reports on staff fundraising activity?
The board ensures that the Has the organization adopted
program is in compliance with policies to ensure compliance with
state and local laws related federal/state laws on solicitation of
to solicitation. funds?
Are solicitation materials
accurate?
The board ensures donations Donations are properly recorded
comply with LSC Requirements. pursuant to LSC regulations
------------------------------------------------------------------------
Continuous Learning and Assessment
------------------------------------------------------------------------
The board is committed to Does the organization maintain
continuous improvement. and provide its board members with an
up-to-date board handbook or on-line
resources?
Do members keep up with issues
that affect the functioning and future
of the organization?
Does the board engage in
periodic formal or informal self-
assessment processes?
------------------------------------------------------------------------
[[Page 14051]]
General Good Governance Practices
------------------------------------------------------------------------
The board ensures legal and Does the board adopt and
ethical integrity and regularly evaluate a code of ethics
maintains accountability. that describes behaviors it wants to
encourage and behavior it wants to
discourage?
Did the board adopt a policy
for handling employee and client
complaints?
Are there established
procedures for employees to report
financial impropriety or misuse of the
organization's resources?
Does the organization have a
whistleblower policy?
Does the board periodically
review the bylaws to ensure that the
organization is in compliance with its
governing documents and relevant laws?
Does the board have policies
establishing standards for document
retention and destruction?
Does the organization keep
books and records relevant to its tax-
exempt status and IRS filings for
appropriate time periods?
The board ensures transparency Are the program's Form 990 and
and accountability by making annual report reported on its public
information available to the website? Are these documents available
public on the program's to the public upon request?
mission, activities, finance
and governance.
The members of the board Is there evidence that board members
exercise independent judgment engage in independent analysis of
in general board decision- materials and information provided to
making. them?
------------------------------------------------------------------------
Criterion 2. Leadership. The program has effective leadership that
establishes and maintains a shared sense of vision and mission. Program
leadership means a commitment to and achievement of the program's goals
and objectives according to a model that emphasizes teamwork,
transparency, excellence, effectiveness, efficiency, and innovation.
------------------------------------------------------------------------
Indicators Areas of inquiry
------------------------------------------------------------------------
General Leadership
------------------------------------------------------------------------
Key program staff, starting Starting with the chief
with the executive director executive officer, are there
or chief executive officer, recognized, positive, and effective
are respected and recognized leaders in the program?
as the program leaders. Do board members, community
leaders, clients and the legal
community express confidence in the
program's leadership?
Program leaders hold What specific leadership and
themselves accountable for professional development training and
motivating staff, and for activities has the program provided?
promoting an environment that What are the outcomes of these
embraces mentoring and the efforts?
professional development of What opportunities are afforded
all staff, helping them to staff to develop and exercise
achieve their fullest leadership skills?
potential. Do staff see themselves as
valued members of the program's team?
Do program leaders model and
encourage teamwork?
Do program leaders delegate
effectively?
Key staff are appropriately Does the program's leadership
involved in decision-making seek the opinions and input of staff
processes. and other stakeholders in its decision-
making processes?
The program's leadership Beginning with the executive
demonstrates strong, director or chief executive officer, is
effective communication there evidence that the leadership of
skills and the capacity to the program communicates effectively
engage in positive conflict with the board, staff and community
resolution. stakeholders?
Do program leaders effectively
address challenges and issues that
impede the program's progress in
accomplishing its mission?
Starting with the executive
director or chief executive officer, is
there evidence that program leadership
effectively models, motivates and
inspires creativity, innovation,
excellence, and achievement?
------------------------------------------------------------------------
Mission and Vision
------------------------------------------------------------------------
Program leaders frame a vision Is there a shared sense of
and mission. vision and mission?
Is it expressed in written
form?
Are staff aware of it?
Program leaders model a high What mechanisms does the
level of energy, commitment program's leadership use to measure
and integrity in carrying out program effectiveness and adherence to
the program's mission. the mission and vision?
In what ways does the program's
stated mission and vision guide the
program's planning and decision-making?
------------------------------------------------------------------------
Diversity
------------------------------------------------------------------------
Starting with the executive In what ways does the program
director or chief executive and its leadership demonstrate
officer, the program values inclusion and an appreciation for
and embraces diversity and diversity?
provides opportunities for Is the program's leadership and
the development of a diverse management diverse, and, is there
group of leaders. evidence that diversity and inclusion
are valued by the program?
------------------------------------------------------------------------
[[Page 14052]]
Succession Plan
------------------------------------------------------------------------
The program has a leadership Does the program have a clear
succession plan that and reasonable succession plan?
addresses preserving Is it written?
institutional knowledge and
strong leadership across all
levels of program management.
------------------------------------------------------------------------
Criterion 3. Technology infrastructure and administration. The
program provides a stable and secure technology infrastructure
sufficient for staff to work efficiently and effectively in the
delivery of legal services and to support the operations of the
organization. It devotes appropriate resources to provide the
capacities outlined in LSC's ``Technologies That Should Be in Place in
a Legal Aid Office Today.''
------------------------------------------------------------------------
Indicators Areas of inquiry
------------------------------------------------------------------------
Technology planning is ongoing Who is involved in technology
and integrated into the planning?
overall strategic plan of the Does the program get input from
program, includes staff staff on technology needs?
input, and is reviewed and Has the program ever had an
updated at least annually. outside technology audit?
How often is the technology
plan reviewed and updated?
Does the plan include deadlines
for implementation?
The program has competent IT What type of network does the
staff and/or consultants with program have?
appropriate training and Are there appropriate
certifications to properly firewalls?
maintain and support its Are servers hosted on-site, off-
technology systems. site, cloud-based?
If on-site, where are they and
how are they secured (locked office,
server room, appropriate A/C)?
What is the program's IT
security program, its policies, user
security training and are the servers,
computers and devices patched and kept
up to on a regular schedule? Is the
network scanned for IT vulnerabilities
regularly?
The grantee informs employees Does the grantee have a warning
of their rights when using banner that appears while employees are
grantee-owned computers. logging on and notifies employees of
their rights when using their grantee-
owned computer?
The program devotes What is the internet bandwidth
appropriate resources to in each office (any redundant
establish and maintain its connection available)?
technological infrastructure, Do offices have Wi-Fi available
including planning and (is it password protected)?
budgeting appropriately for
ongoing replacement/upgrades
of its technology systems.
The program has a proper Is server equipment kept in a
written IT security program secure environment with appropriate
to include robust IT security ventilation and cooling? Are IT systems
policies and procedures currently patched and updated?
regarding protecting client Is there a disaster recovery
and case data, ensuring the plan (that includes periodic testing)
security and integrity of for mission critical technology
passwords, use of the systems?
Internet and social media, Are there security policies and
policies for the use of procedures for protecting client and
mobile devices, and if staff case data, sensitive personal and
can bring their own devices personnel data, and all communications
(BYOD) to access work from loss or unauthorized intrusion?
documents. Staff are familiar Are there security policies and
with and follow such policies procedures for use of the Internet and
and procedures. social media, content security on all
devices, and integrity of passwords,
retention and deletion of data?
Are employees given notice
concerning prohibited uses of their
computer equipment including a warning
banner that notifies employees of their
rights (including no expectation of
privacy) when using their grantee-owned
computer?
Is there routine IT security
training for staff?
Is the user's system access
granted based on roles and
responsibilities?
The program has sufficient What are the backup procedures?
procedures to back up its Are test restores done
data and has testing periodically from the backups?
protocols to demonstrate that
data recovery/protection
policies work in practice.
The program stays informed of What is the replacement cycle
new technology developments for technology equipment (desktops/
and how it can make better laptops, servers, printers, scanners,
use of technology to meet its copiers, telephones, etc.)?
mission. What type of phone system does
the program use?
How old is it?
When was the last upgrade?
What reports can it provide?
Who maintains it?
------------------------------------------------------------------------
Extent to Which Technology Enhances Program Operations and Service
Delivery
------------------------------------------------------------------------
Maximum use of technology is Does the program use technology
made to facilitate and effectively to enhance the efficiency
enhance internal of program operations and service
communication. delivery?
How does the program use
technology to facilitate and enhance
communication?
Does the program's website
effectively follow the Ernst and Young
Best Practices (https://webassessment.lsc.gov/report/)?
------------------------------------------------------------------------
[[Page 14053]]
Staff Training
------------------------------------------------------------------------
Program staff are provided Does the program have a policy
with appropriate training on for the secure use of its technology,
the use of technology. including protecting data (including
Personally Identifiable Information),
use of the Internet and social media,
password policies and if/when staff can
bring their own devices?
Do staff understand and follow
the policy?
What software does the program
use, including case management system
manufacturer and version?
Are staff provided with ongoing
training in its use?
------------------------------------------------------------------------
Criterion 4. Financial administration. The program has and follows
financial policies, procedures, and practices that comport with
Generally Accepted Accounting Principles (GAAP), requirements of the
program's funding sources, and comply with federal, state and local
government regulations. The program has established sound internal
controls and conducts effective budget planning and oversight.
------------------------------------------------------------------------
Indicators Areas of inquiry
------------------------------------------------------------------------
Fiscal Policies and Staff
------------------------------------------------------------------------
The program has detailed Is the program's accounting
written policies and manual current and updated as
procedures describing its appropriate?
financial operations which
comply with all applicable
requirements. The program
follows such policies and
procedures.
The program has sufficient, How many financial staff does
capable, trained and the program have?
effective staff dedicated to Does the program have competent
financial administration. financial personnel?
What is the training and
background of the financial staff?
The job descriptions of
personnel are clear and lay out the
roles and responsibilities of each
position.
Is periodic training given to
program staff, management, and the
governing body regarding LSC
regulations and accounting guide, as
applicable?
Top management and the Is the budget consistent with
governing body are actively the program's mission, goals, and
involved in the budgeting objectives?
process. The budget is Does the program effectively
updated periodically and adhere to its budget?
changes/variances are Is the budget updated monthly
reviewed. The program engages (or at least quarterly), based on
in financial planning beyond changes in revenues or expenditures?
the current year. Does the program engage in
financial planning beyond the current
year?
The program maintains LSC Does the recipient adhere to
funds held for immediate LSC Investment Guidelines?
operating expenses in
federally-insured bank
accounts.
------------------------------------------------------------------------
Board of Directors
------------------------------------------------------------------------
The recipient's governing body Has the board established a
has fulfilled its fiduciary financial oversight committee or
responsibility to the program committees that perform the roles of a
through the establishment of finance committee and an audit
a financial oversight committee?
committee or committees. The Does the financial oversight
financial oversight committee collectively possess the
committee(s) has at least one knowledge to set the strategic,
member who is a financial financial course for the recipient and
expert or the board has oversee management in execution of the
access to a financial expert. strategy?
Does the financial oversight
committee have the leadership of
individual well-versed in non-profit
GAAP, COSO Internal Control Framework,
and other relevant standards and
guidelines?
Does the financial oversight
committee meet on a regular basis?
Does the committee have a
charter or governing document and
fulfill the responsibilities outlined
therein?
Does the financial oversight
committee set the strategic direction
of the recipient for financial and
audit related matters?
The governing body regularly Does a governing body set and
determines the compensation review the compensation of the
of the program's Executive Executive Director using an independent
Director. compensation consultant, comparable pay
studies from other nonprofit
organizations, and/or a compensation
survey?
The Executive Director's Are there procedures in place
expenses are approved by a that require approval of the Executive
member of the board. Director's expenses by a member of the
governing body?
------------------------------------------------------------------------
Audited Financial Statements
------------------------------------------------------------------------
The program issues accurate Are the audited financial
financial statements on a statements submitted to LSC in
timely basis. accordance with the LSC Audit Guide for
Recipients and Auditors?
Has the program submitted their
audited financial statements in a
timely manner over the last 3 years?
Executed one-time grants, such Are executed one-time grants,
as TIG and PBIF awards, are such as TIG and PBIF awards, reported
reported separately in the either as a supplemental schedule of
program's audited financial related revenue and expense or a
statements in accordance with separate column within the financial
45 CFR 1628.3(e). statement?
[[Page 14054]]
Annual program audits do not Do past audits or outside
reveal any significant reports and evaluations reflect
problems or issues; where problems?
such items have been Have any such problems been
identified, the program addressed?
addresses them effectively Is there any evidence of
and promptly. failure to comply with applicable
funder or governmental requirements?
What type of auditor's report
did the IPA issue regarding the
financial statements? Unmodified or
modified? If modified, why?
What type of auditor's report
did the IPA issue regarding Federal
Awards? Unqualified or Qualified? If
qualified, why?
Did the IPA issue findings in
the audited financial statements? What
were the findings? Have they been
addressed?
Did the IPA issue a management
letter? What did it contain? Has the
recipient addressed the issues?
Are audit findings repeated
from one fiscal year end to the next in
the audited financial statements?
Does the recipient adequately
address audit findings by performing
the corrective actions outlined in the
audited financial statements?
------------------------------------------------------------------------
Internal Controls
------------------------------------------------------------------------
The recipient has established There is sufficient segregation
and maintains adequate of duties.
accounting records and Do the accounting policies and
internal control procedures. procedures require an appropriate level
which is designed to provide of supervisory review and adequate
reasonable assurance of checks and balances to ensure the
achieving the following accuracy, completeness and timeliness
objectives: (1) Safeguarding of transaction processing?
of assets against The recipient has established
unauthorized use or and adheres to an adequate system of
disposition; (2) reliability internal control following the
of financial information and principles of the COSO Integrated
reporting; and (3) compliance Internal Control Framework.
with regulations and laws
that have a direct and
material effect on the
program.
------------------------------------------------------------------------
Contracting
------------------------------------------------------------------------
The program has a contracting Does the program have a
policy to prevent abuse, contracting policy?
limit waste of scarce funds, Does the policy identify the
and prevent possible contracting procedures for the various
questioned cost proceeding. types of contracts, dollar thresholds,
and competition requirements?
Is the process used for each
contract action fully documented and is
the documentation maintained in a
central file?
Is the required approval level
(including items that need to be
approved by LSC) established for each
contract type and dollar threshold,
including when the board of directors
should be notified and/or give
approval?
Do policies include procedures
for documenting and deviating from the
approved contracting process, such as
when sole-source contracts are
executed?
Is each contract or agreement
executed with a price, time-period, and
services to be performed?
------------------------------------------------------------------------
Fraud Prevention
------------------------------------------------------------------------
The program has robust Assess the organization's
policies and safeguards in segregation of duties.
place to prevent fraud. Who has access to the program's
bank accounts?
How are permissions and
authorizations assigned?
Does the program have
Whistleblower and Conflict of Interest
Policies?
Is the program's IT
infrastructure adequately secure?
Is the physical and logical
access to the program's computer
network adequately secure?
Does the program's governance
and management of IT resources promote
effective operations and provide a
robust system of internal control?
Do the program's computer
applications incorporate and facilitate
a robust system of internal control?
Have thorough and well
documented hiring practices and
procedures?
Are staff periodically trained
or reminded of the Whistleblower and
Conflict of Interest Policies?
Does the program employ
computer banners on all servers,
computers and devices to inform
employees of prohibited use activities
and no right to privacy of grantee
equipment?
------------------------------------------------------------------------
Cash Disbursements
------------------------------------------------------------------------
The program's disbursements Are procedures adequate to
are approved in writing by an provide that salary and wage rates are
authorized individual. approved by an authorized individual
and employees are paid in accordance
with approved wage and salary plans?
Were invoices properly
approved, with dates, before
disbursement checks were processed?
Do policies and procedures for
disbursements address unallowable
expenses, purchase approvals, securing
and approving new vendors, segregation
of purchasing duties, and duplicate
payment controls?
[[Page 14055]]
The program's criteria and Is there a procedure for proper
procedures for purchases are payment and approval of expenditures at
documented. an appropriate level of management?
------------------------------------------------------------------------
Cash Receipts
------------------------------------------------------------------------
The program has established Is initial accountability for
internal control procedures cash established as soon as a cash item
related to cash receipts. is received?
Do the accounting records
adequately identify all cash receipts
as to source and purpose?
Is an effective chain of
custody in place for cash receipts?
The program maintains a client Has the program established a
trust fund and accounting method to determine the balance for
system to account for funds each client trust account?
held on the client's behalf. Does the program have a process
to ensure that dormant funds are
escheated to the state in compliance
with state requirements?
------------------------------------------------------------------------
Asset and Property Records
------------------------------------------------------------------------
A physical inventory of Is a physical inventory
property purchased with LSC conducted at least once every two (2)
funds is conducted at least years?
once every two (2) years and Are any differences between the
the results are reconciled physical inventory and the accounting
with property records. records reconciled?
The program has established Is there a surprise count of
adequate internal controls to petty cash conducted periodically?
safeguard its petty cash Are the petty cash and client
funds. trust funds secured in locked location?
Are all petty cash
disbursements supported by an original
receipt or appropriate supporting
documentation?
------------------------------------------------------------------------
Subgrants
------------------------------------------------------------------------
The program has established Does the subgrant agreement or
adequate procedures related contract with the sub recipient specify
to the subgranting of LSC financial reporting responsibility?
funds to ensure compliance Where a relationship with a sub
and proper fiscal oversight. recipient exists, do the notes to the
financial statements of the recipient
